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AVOID PRICE SPECULATION; AICC ADVISE STAKEHOLDERS

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The marketing season for the 2016/2017 growing season is finally here. From all perspectives, things have already started to take shape on the market with various traders flocking to rural areas to buy various commodities from smallholder farmers. With levels of poverty so high among many smallholder farmers, coupled by high illiterate levels, most farmers have been tempted to sale their commodities when they have not fully dried up to the correct moisture. This is done perhaps with the hopes of making hay while the sun shine and possibly address some of the challenges they meet in their day to day life. However, when all is said and done, one thing that remains critical to almost all stakeholders especially farmers, is usually prices. While farmers are excited with the good produce they have realised due to the good rains experienced this growing season, a major concern of many farmers is on prices, as such seasons are usually characterized by low prices of commodities.


As one way of ensuring that fair trade prevails this season, the African Institute of Corporate Citizenship (AICC) through its Market Access Programme, has been organizing business to business meetings across the regions in Malawi with an aim of fostering partnerships and trust among all players in the agricultural value chain. The meeting in central region, that took place at cross roads hotel in Lilongwe, saw various players from both the private and public sector patronizing the event. 10 companies and 61 farmers from various associations and cooperatives in Lilongwe, Dowa and Ntchisi attended the event in Lilongwe.


Emily Buluzi is one of the farmers working with AICC under the SALF Programme since the programme started in 2013. After participating in the meeting and having had time to interact with buyers and companies at the conference, she said, her hopes of making a good fortune this marketing season have resurfaced as her interactions with the said buyers has made it possible for her associations to strike good deals with the companies.


‘It is true that we as farmers are very worried with prices this year. We have vendors in the village who often come when sometimes they know my child is sick and I need money urgently so I have no choice and cannot check if they are using the right scale. I just sell my commodities. However we hope the partnerships we are establishing from this business to business meetings like these, together with what we have learned about selling collectively and marketing our commodities, we will realize more than what we thought” lamented Buluzi.


On the sidelines of the conference, AICC SALFP’ programme manager, Mcloud Kayira, advised stakeholders to avoid speculating low prices for farmers’ produce just to justify low offers but rather work to stimulate local demand by opening up to the international demand. He said in doing this provision of market information will be key and platforms where farmers engage buyers are very important.


‘We have had a seemingly good season this year with high production in most fields. However, there are fears among many smallholder farmers that prices will go down. I want to ask fellow stakeholders in the industry to avoid speculating low prices which would only justify low offers by traders allowing them to take advantage of farmers but rather work to stimulate the local demand,’ said Kayira. He added that seemingly high national production does not imply low prices. ‘Price is a factor of demand and supply and apparently the local and international demand for our legumes and other crops other than tobacco is higher in countries where they did not have sufficient rains like Zimbabwe, Kenya just to mention a few,’ he added.


Kayira indicated that in Malawi market information is a huge challenge and a majority of unscrupulous buyers take advantage of this to make more money over farmers. He therefore advised stakeholders to help in organizing farmers and ensuring that they are informed when making deals with buyers.


When asked to explain how international demand can translate into local demand to benefit farmers, he said, ‘for organized farmers, they can directly export following all the necessary requirements. There are institutions like AHCX and MITC that help.’ However he noted that there are few organized farmers so the best option is for government and its stakeholders to open up to international demand and allow farmers and traders that can to buy and export. When traders see the export demand, farm gate prices will go up in anticipation of better prices on the export market. So going forward government has to be clear on export bans and other trade regulations as soon as possible while stakeholders help pass the necessary market information and organize farmers.

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African Institute of Corporate Citizenship,
Taurus House
Off Convention Drive,
Private Bag 382,
Lilongwe 3,
Malawi

Phone: +265 1 775 787

Email: aicc@aiccafrica.org

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