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The economic advantages of improved agro forestry fallow systems over traditional continuous cropping systems are important tools that can be used to influence the choice of land use options at household levels. In Kigezi highlands Uganda, the upper parts of farmers’ crop field terraces are degraded due to continuous cropping. Improved fallows are being promoted in order to increase soil productivity while increasing fuelwood production. Fallows also increase carbon storage in soil and woody biomass.A cost benefit analysis, done to establish the impact of a carbon market on fallow profitability showed that woody biomass carbon would increase farmers’ annual returns by 8, 13 and 26% for the Sesbania, Calliandra and Alnus systems respectively. Soil carbon would increase annual returns by 9, 18 and 40% for the Sesbania, Calliandra and Alnus systems respectively. Without carbon market, Sesbania is more profitable and sustainable; while with carbon markets, Alnus is more attractive. [author]
