Rice is considered one of the key strategic crops in the country with a massive potential to be promoted primarily as an import substitute, but also as an export crop.
As an export crop, rice has the potential to generate the much-needed revenue in the country.
If rice is to be exported, it is imperative that the marketing systems in the rice value chain be improved and strengthened to benefit all the value chain players from the smallholder farmer to exporters.
While the situation is like this, the processing and marketing of rice in the country continues to be hampered by a number of factors, chief of which is lack of a structured market system. As such, there are a number of impediments which the marketing of rice is facing.
Gerald Kawele of Nsenjere Rice Growers Association in Nkhotakota says the market trends that rice farmers are facing are discouraging and they feel they are being duped by intermediate buyers who buy their un-milled rice.
He says: “A majority of rice farmers do not have a ready market for their produce, therefore, we rely heavily on seasonal vendors and traders. This has limited us in terms of the price gains due to our inability to benefit from higher prices offered by the large-scale millers.”
Further compounding their problems is inadequate storage and milling facilities, which many times force them to sell their rice when it is un-milled, resulting in the failure to negotiate for better prices as their produce lacks any degree of value-addition.
In Malawi, 74 percent of rice farmers sell un-milled rice while in some other cases, farmers sell their produce to their associations or cooperatives which market the rice for them. This helps them attain better prices too.
Marriam Bwanali of Lifuwu Cooperative in Salima pleads with government and organisations to stamp their authority on the rice market to regulate minimum rice prices and set other controls, describing the market as full of exploitation by vendors.
“There is need for a stable price controlling mechanism to be put in place with good enforcing instruments attached to it so that everybody respects and adheres to it. At the moment it looks like it is a free-for-all affair and it is us, farmers, who are suffering in the end while the middlemen reap from our sweat.
“Every vendor is at liberty to come to us and set a buying price of his liking and we are left with no option as we are also dictated by the financial needs of our households in our daily lives such as sending our children to school and feeding them too,” she says.
Value chain programme manager for Icco, Dalisto Makoka, feels the challenges in the marketing and processing of rice goes beyond having a steady market. He cited low production and productivity to be among factors affecting rice farming.
“Contrary to popular views in rice value chain as well as the whole agriculture sector in Malawi that market failure is a major challenge, the main challenge is low production and productivity.
“Potential yield of some rice varieties is as high as seven metric tonnes [MT] per hectare, but farmers are getting about two MT per hectare.
“With low production, even if buyers are paying more, take home cash will still be low. So priority should be on increasing productivity,” he says.
Makoka says failure by farmers to make use of farmer cooperatives is affecting their operations to a great extent.
“Farmers are also poorly organised in irrigation schemes where there is power struggle between Water Users Association [WUA] and Farmer Cooperatives. WUAs are promoted by the Ministry of Agriculture, Irrigation and Water Development while cooperatives are promoted by the Department of Cooperatives in the Ministry of Industry, Trade and Tourism. Their working principles need to be harmonised so that the two structures work to build and strengthen each other.
“Cooperatives are expected to be the main market link between farmers and the buyers. But most cooperatives are poorly structured, lack capacity in areas of personnel, infrastructure and financial resources. Most farmers have not embraced the spirit of cooperatives,” he says.
Secretary for Agriculture, Irrigation and Water Development Erica Maganga said they encourage rice farmers to work as cooperatives so that they are not exploited on the market by intermediate buyers.
“We always advise these farmers not to be selling their rice on an individual level, they need to sell in bulk through their cooperatives so that they can increase their bargaining power and also to mill it to attain a degree of value addition to increase their take-home package at the end of the day,” she says.
Icco in 2015 worked with other stakeholders such as Civil Society Agriculture Network (CisaNet), Christian Aid and the Department of Cooperatives and has established a Rice Cooperative Union of Malawi.
The union processes and markets farmers’ rice. In this case, value addition can be sustainable as the country can export high quality processed rice.
This story was published by Nation Publications Limited (NPL): http://mwnation.com/lack-of-viable-markets-stifles-rice-production/