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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.

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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.



© 2016 Charlie Maere and Dennis Lupenga Designs


African Institute of Corporate Citizenship,
Area 47/5/394
Off Bwanje Road,
Private Bag 382,
Lilongwe 3,

Phone: +265 310 001 396 (Administration)

+265 310 001 394/395 (Technical Staff)



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