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Farmers under SALFP Program Smile amidst Market Failure

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Some farmers from Mwamulo Famers Club, one of the many clubs that AICC has mobilized in Kanjiwa EPA, Ntchisi District
Some farmers from Mwamulo Farmers' Club, one of the many clubs that AICC has mobilized in Kanjiwa EPA, Ntchisi District

In this 2016/2017 season, farmers have faced a number of challenges in respect to fluctuation of their prices. Attracted by better prices which they received the previous year, farmers dedicated themselves this year which has generally turned to be one of the best years with above normal rainfall. However the challenge has been prices which on average, turned out to be half of what farmers sold their produce last year. Buyers that entered into contract farming followed market prices as stipulated in their contracts. Some buyers came out of the signed contracts because they were not binding. Some high value markets resorted to using small traders to aggregate commodities at the same low market prices just to take advantage of farmers. This meant huge losses for farmers and a great reduction on their disposable incomes and inability to provide for their families.

Amidst this market failure, some farmers under the Sustainable Agriculture Lead Farmer (SALFP) Program which is being implemented by, the African Institute of Corporate Citizenship (AICC) with support from the Development Fund of Norway have a different story to tell. Under the project, AICC mobilizes farmers to be in groups where they aggregate commodities for them to sell collectively.

These farmers were able to aggregate their commodities, store it and wait for prices to pick up. While most farmers sold their Soya Beans at average prices of MK100 per Kg, now these farmers are selling at average prices of MK200 per Kg. Such clubs include Mwamulo Farmers Club in Ntchisi District, three Cooperatives in Mzimba and One Cooperative in Lilongwe rural district whose stories appear below.

Mwamulo Famers Club is one of the many clubs that AICC has mobilized in Kanjiwa EPA, Ntchisi District. The club is found in Mwamulo Village in Binu Section. Currently they have aggregated maize amounting to 7.5tonnes which is ready for sell. According to the members of the club, the selling is not going as planned as they did not imagine that by this time they could still be keeping the grain. This has been the case as they are still to find a buyer with a good price for the commodity.

This situation has brought along a couple of challenges to the members of the club individually as well as collectively. To begin with, since the club comprises of smallholder farmers, the club does not have the capacity to own a warehouse hence they are using the house of a treasure to the club to keep the commodity. This has affected the owner of the house as the space for her house has been reduced to some extent as the commodity has occupied some space. There is also a fear of thieves from the members of the club and the treasure to the club. This is to say, some members of the community are aware of the aggregated maize which can lead to thieves breaking into her house.

Some of bags of aggregated maize by Mwamulo Farmers’ Club
Some of bags of aggregated maize by Mwamulo Farmers’ Club

In addition, the maize that has been aggregated is for business purpose and the delay in selling has affected the clubs business plans. They had set plans from the proceeds and since they are to get a buyer for the commodity, the plans are on a stand still.

The club is not losing hope as they are optimistic about promising prices. They say what has happened with the Soya Bean is giving them confidence that it will be the same with maize. Currently there is a sharp increase in the prices for Soya Bean. The National Food Reserve Agency (NFRA) is also yet to buy the maize grain, this is according to one of the members to the club who said he is always following the issue on radio. He is confident that when this government agency start buying the grain, there will be an increase in the price of the commodity.

Three cooperatives from Hora EPA namely: Chiyanjano, Katambala and Maumba cooperatives managed to aggregate more than 45 tons of soya in their local warehouse while looking for buyers and it took two months without any possible deal to sell their commodity and farmers started losing hope since vendors were buying at a very low price as low as MK110 per kg with an unauthorized scale. In the month of July 2017, AICC managed to link these cooperatives to ACE at MK180 per kg.

Three cooperatives from Hora EPA namely: Chiyanjano, Katambala and Maumba cooperatives loading maize into ACE truck after the sell
Three cooperatives from Hora EPA namely: Chiyanjano, Katambala and Maumba cooperatives loading maize into ACE truck after the sell

Currently about 25 tons of maize is in their local warehouses looking for better market and farmers are optimistic that with the coming in of NFRA through Government, farmers will be able to sell their commodities at a better price.

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African Institute of Corporate Citizenship,
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Lilongwe 3,
Malawi

Phone: +265 1 775 787

Email: aicc@aiccafrica.org

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