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Collective storage and Marketing of Rice: A case of Domasi Rice Association, Machinga

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Paddy ready to be processed at Domasi Association Super Rice Mill

The case of Domasi Irrigation Rice Association has in-depth intensification of imperativeness of collective marketing. At first, rice farmers used to sell rice individually which led to minimization of returns as there was no bargaining and negotiation skills. In 2016/2017 growing season, the Rice Platform under AICC, strengthened the association with marketing skills which were biased towards selling collectively. The collective marketing concept was embedded in the constitution so that all members comply accordingly. The marketing committee and the whole association were trained in producer groups and other actors in value-chain and business development practices, group dynamics, financial management, conflict management and approaches in group marketing.

To its credit, Domasi Rice Association has 155 tons of rice stored in the warehouse ready for potential markets and milling plant for processing paddy. About 24 metric tons has been polished and sold collectively to potential buyers at K400 per Kg. The association made about K22 million from the sell. This has been shared amongst the members for various households needs and buying of shares in the Village Savings and Loans groups which also introduced by AICC  as one innovation within the Malawi Agriculture Partnership-Phase 2 program.

At first, fellow farmers didn’t see the goodness of collective marketing with a business eye. They thought it was about wasting time, hence in some cases; buyers would come to buy from us some months after harvesting. Through negotiation meetings and transparency in bargaining for prices with buyers, members are able to sell at a good price and their life needs are being met,” said Anderson Chapita, Chairperson, Domasi Rice Association, Machinga.

Domasi Irrigation Rice Scheme lies along the Domasi River in Machinga. In total, there are 2057 farmers (957 females and 1100 males) and a total cultivated land of 462 Hectares. Apart from Kilombero and Supa Faya type of rice, Domasi also produce Kayanjamalo, TCG 10, Pusa and Mtupatupa.

Niche market opens for cotton industry

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Although cotton production has been declining over the years, there is potential for the country to tap the unexploited niche market for conventionally bred cotton whose demand has been increasing in the face of insufficient supply to meet demand.

Malawi and other countries in Africa grow cotton which has long fibres and is carefully picked by hand which makes it a high quality raw material for textile and fabrics.
According to an outlook of the cotton industry for the period January to March 2017 compiled by the African Institute of Corporate Citizenship (AICC), this market niche for conventionally bred cotton provides opportunities for Malawi to exploit.

The cotton industry is battling a plethora of immerging global issues in the industry such as synthetic fibre boom, resurgence of new pests and the dominance of transgenic technology

Recently, the industry has seen a shift in demand of textile from natural fibres to synthetic fibres on the back of a rise in industrialisation which is eating into the market for cotton.

But AICC says despite the shift, cotton remains a vital component in economies of many developing countries and the livelihoods of millions of small-scale farmers.
“At the rate at which synthetic fibres are being produced, cotton fibres continue to face a stiff competition on the world market with synthetic fibres which are cheaper to produce and exhibit a high level of design and freedom in research, making them attractive to makers of clothing,” AICC said.

Meanwhile, stakeholders in the cotton industry are lobbying government for an injection of $30 million as a short-term measure to boost cotton production.
The players are being led by AICC and include the Cotton Council of Malawi and Cotton Farmers Association of Malawi.

Although Malawi’s fourth major foreign exchange earner, cotton production has continued to decline over the years now averaging yields less than 600 kilogrammes per hectare.

Uncertainty of availability of inputs and reliable markets are among the factors that have led many cotton farmers to seek alternative high value crops.
Cotton production in the country has been declining over the years tumbling from 100,000 metric tonnes in 2011 to 15,000 metric tonnes now, risking the livelihoods of cotton farmers and the economy.

This is happening as demand for textile fibre has been growing globally since 1980s, only eight percent of textile was annually used on a per capita basis worldwide. By 2012, this had risen to 12.2 kilogrammes, a 53 percent increase in per capita use.

In 2015, a total of 85.8 million tonnes of textile fibres were produced worldwide depicting a tremendously increase in demand of the product.

Cotton had traditionally dominated the global fibre trade since 1960s but the emergence of other forms of fibre has seen cotton consumption dwindling after the 1960s.
Cotton consumption has been floating around 10 – 30 million tonnes against synthetic fibres which have exponentially risen from 15 million tonnes in 1960s to about 90 million tonnes in 2016.

“A problem shared is half-solved.”

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Just like many sectors, the agriculture sectors in multi-faced such that various challenges will continue to rock the sector. However, for sustainable solution as well as sector vibrancy there is a need for the public and private sector to work closely at all levels.

Felix Lombe, CEO of African Institute of Corporate Citizenship says that unlike other sectors, private sector engagement in the agriculture sector has been very minimal at all levels and this has equally affected the operations within the sector.

“In wake of this, we would like to urge all players in the sector including the private sector to work together in order to grow the sector in the direction that all players desire. Lasting solution to the challenges facing the sector can also be addressed only when all stakeholders take part in finding solution.”

African Institute of Corporate Citizenship (AICC) is a non-governmental organisation whose main mandate is to promote the role of business in development. AICC specialises in acting as a catalyst and facilitator of change; a broker and initiator of multi-sector partnerships and platforms; and a knowledge management hub for issues relating to the role of responsible business in African societies. AICC is committed to promoting responsible growth and competitiveness in Africa by changing the way companies do business in liaison with the public sector. This is done to benefit people and the economy while building sustainable communities.

AICC started in the 2001 with its first office in South Africa but later in 2005, the organisation expanded and opened a branch in Malawi. Since then, AICC has been involved in research; advocacy; training and capacity building; facilitation of multi-stakeholder process for policy change; social learning and collective action in various fields including agribusiness value chain and social development.

Lombe says AICC’s goal is to ensure that the public sector works closely with the private sector.

“Many developing nations in Africa continue to face various socio-economic challenges despite the ever increasing support and interventions being fostered by various players in the country. These dynamic challenges facing African countries today call for not only renewed and concerted efforts but also collaborative efforts by all relevant stakeholders. Major challenges experienced by the ever-growing population amidst ever decreasing resources require governments, private sector and civil society to act together to exercise shared responsibility to achieve collective prosperity that help build sustainable communities. Thus to say, the countries can only register high success in development if there is strong correlation between the public and private sectors.”

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