Tag: Malawi

  • Malawi looks to cannabis

    Malawi looks to cannabis

    Malawi’s legislators will consider in March a bill to legalize medical cannabis and hemp, as the country looks to reduce its reliance on tobacco, according to a VOA News story relayed by the TMA.

    Tobacco was said to account for 13 percent of the country’s gross domestic product and 60 percent of its foreign exchange earnings.

    Lesotho, South Africa, and Zimbabwe have already adopted similar measures.

    Boniface Kadzamira, a member of Malawi’s parliament who has long pushed for the legalization of cannabis said, “we were the first in this part of Africa to start discussing this thing”. “Those countries that came after us have gone ahead of us and have already started issuing licenses,” he added.

    According to the VOA story, anti-drug campaigners worry legalizing medical marijuana will encourage more recreational use but they’re facing an uphill battle against those who argue to regulate the trade and help Malawi’s economy grow.

  • Inhumane estates in Malawi

    Inhumane estates in Malawi

    A minister in Malawi’s government has issued a stinging attack on the living conditions of tobacco-farm workers.

    The Minister of Labor, Youth, Sports and Manpower Development Grace Chiumia said that tobacco tenants were living in appalling conditions in which a family of seven could be sharing a small shack made of grass and covered with mud, according to a Malawi News Agency story.

    Chiumia was speaking during a visit to Kasungu on Wednesday to inspect tobacco estates and farms, and to check on child labor.

    The minister said the way the estate owners kept tenants was not humane. They were rather kept like non-human animals.

    “Look at a house a tenant is being kept in, very small and without any ventilation, and you find a family of seven staying in this house,” she said. “You will find the father, mother and the children and sometimes … chickens in the same room. The same room is also used as a kitchen.

    “This is bad; how do you think the health of people will be? The estate owners come here and go to sleep in their good houses; how do they feel?”

    The minister warned that such behavior should stop immediately. She said if estate owners wanted to grow tobacco and keep people as tenants, they had to provide standard houses.

    The minister noted that most of the tenants’ children did not attend school. Some helped their parents while others stayed home.

    According to the story, estate manager Yusuf Bonongwe said managers tried their best to keep the tenants ‘safe’ but sometimes the tobacco market was not good, which forced them ‘not to give the tenants the necessary requirements’.

    “We cannot do all but we try our best,” he said. “Most of the tenants stay in good shelter that are just good enough to dwell in despite being shacks.”

    Bonongwe said that his estate was free of child labor and encouraged workers to send their children to school.

    Kasungu has more than 22,000 tobacco farms, according to the district’s labor office.

  • Growers "ripped off"

    Growers "ripped off"

    The Malawi Parliament on Monday passed the Tobacco Industry Bill, which, among other things, bans buyers from growing tobacco or engaging in the transport and grading of tobacco, according to a story at Malawi24.com.
    The law is aimed also at strengthening tobacco associations by increasing membership from 3,000 to 5,000.
    Speaking after the bill was passed, the Minister of Agriculture Joseph Mwanamvekha said the new law meant farmers would no longer be ripped off by buyers. It would introduce sanity to the tobacco industry.
    “In the past, the farmer was ripped off,” he said. “The farmer signed the contract without knowing the prices he would be offered.”
    The minister claimed also that the law would help reduce poverty because farmers would earn more.
    However, last week, the Member of Parliament for Karonga North, Frank Mwenefumbo, opposed the bill saying it would benefit only companies.
    Mwenefumbo, who is a member of the Alliance for Democracy (AFORD) party, said people in his constituency were against the bill because farmers were aware that it would favor the tobacco companies rather than the farmers.
    “Let us put our farmers first and the rest should come second; farmers are the ones who put much effort and money in tobacco business but what do they gain at the end of the day: peanuts, which is not fair to our farmers,” he said.
    “These companies are making a lot of profits from our farmers’ sweat; farmers should therefore have all the powers and the companies should surrender their licenses to our farmers; otherwise, this bill is no of use.”

  • Protecting growers

    Protecting growers

    Debate on a report on Malawi’s Tobacco Industry Bill by a joint parliamentary committee has been deferred by the leader of the House, Kondwani Nankhumwa, according to a story in The Maravi Post.
    The bill, which was tabled in June this year before being referred to the joint committee, seeks to consolidate the Tobacco Act and the Control of Tobacco Auction Floors Act into one law.
    It also seeks to introduce regulations specifically designed to cover contract farming, whereas previously only the auction system was recognized in law.
    Presenting the report to the House, committee chairperson Joseph Chidanti Malunga said the bill would regulate contract farming and fill the gap in the legislation.
    He said the committee had taken into consideration the fact that contract farming would drive auction marketing to extinction.
    “The joint committee was of the view that the bill should not provide for any quota,” he said. “The markets should be left open and the market dynamics should prevail and determine volumes of tobacco to be produced and sold under either system.”
    The Post report said that, under the contract farming system, growers suffered a lot of deductions, many of which they become aware of only ‘when the tobacco was being sold by the buyer’.
    The committee was said to have received submissions that contract farming should be eliminated because it had proved to be less profitable for growers than the auction system, even though contract tobacco was sold for a higher price than was auction tobacco.
    “The committee considered the submission and formed the view that the funded contract system should be retained because not all farmers can afford to produce tobacco with their own resources,” said Malunga. “If it is abolished, growers will be forced to get loans from commercial banks who charge exorbitant interest rates.”
    However, the committee has recommended additional provisions aimed at protecting growers operating under contract farming from deductions not properly spelt out and other financial burdens.

  • Malawi prices plummet

    Malawi prices plummet

    The [average] price paid to tobacco growers in Malawi this year fell by 16.5 percent from that of last year, according to a Reuters story relayed by the TMA.
    The average prices for 2017 and 2018 were not given but last year the country’s Tobacco Control Commission (TCC) reported that, on average, tobacco had fetched US$2.00 per kg in 2017 against the previous year’s US$1.50 per kg.
    On this basis, this year’s average price would have been about US$1.67 per kg.
    However, there was a question mark over the 2017 and 2016 prices given last year. The story in which the TCC was quoted as saying the 2017 price was US$2.00 per kg, seemed to give the grower revenue for 2017 as US$212 million earned from the sale of 124 million kg, which would suggest an average price of US$1.71 per kg. And the 2016 revenue on the sale of 194 million kg was given as US$275 million, which suggested an average price of US$1.42 per kg. (The average price of US$2.00 per kg cannot be explained as being the average price for one of the tobacco types because the story gave the various averages as: US$1.36 for dark fired tobacco, US$1.80 for Burley, and US$2.92 for flue-cured.)
    On this basis, this year’s average price would have been about US1.43 per kg.
    The prices certainly seem to have been poor. Even at US$2.00 per kg, the average price was down on that of 2013, for instance, when it stood at US$2.11 per kg.
    Auction Holdings Limited and the TCC were reported by Reuters to have issued a joint release that said revenues for 2018 had reached US$337.5 million, up from US$212.4 million in 2017. The reason why revenues rose by about 60 percent while prices fell by 16.5 percent was put down to a 90 percent increase in volume.
    Even this year’s revenue looks miserly. Figures from the TCC show that tobacco revenue in 2010 stood at $410 million.

  • Malawi growers underpaid

    Malawi growers underpaid

    Malawi’s Burley growers are underpaid, according to a new report cited in a Maravi Post story relayed by the TMA.
    The report, entitled The Burley Tobacco Value Chain Analysis, was released by the Center For Social Concern (CFSC).
    It called for crop diversification for Burley tobacco growers and the creation of a structured market for them, because currently they were not ‘adequately compensated for their contribution in the value chain’.
    The report found very low levels of crop or enterprise diversification within the tobacco sector.
    It said that farmers understood the need to diversify their range of crops and that most of them already grew other crops, with the most popular being maize (for food), groundnuts, soybean, and beans.
    However, the consensus of the farmers was that as a cash crop, there was currently no viable alternatives to tobacco.
    “There are so many factors suggesting the leaf processing companies enjoy wider profit margins which can be passed on to other players through higher prices on the auction floors,” said CFSC programs officer Lucky Mfungwe. The Malawi Government needs to be more resolute in enforcing minimum prices to make this happen.”
    Mfungwe said that since the domestic tobacco sector was consolidated “there needs to be continuous efforts to bring in more buyers at the auction floors to help build up competition for the tobacco grown by independent farmers”.
    He called also for a “review of the contract farming mechanism to ensure that it remains beneficial to the industry in the long term”.

  • Growers left in limbo

    Growers left in limbo

    The tobacco market in Lilongwe, Malawi, was suspended yesterday after hundreds of tobacco farmers protested against a decision by JTI Leaf Malawi to stop buying tobacco from farmers the company had contracted, according to a story in The Nyasa Times.
    JTI officials reportedly had not been to the market since Monday and the Times said that no JTI representatives were on hand to confirm or deny a suggestion by one unnamed source that the company had accused the farmers of over-production.
    However, the head of communications at Auction Holdings Limited (AHL) confirmed that there had been a stand-off between the company and the tobacco farmers.
    He said there were nearly 300 tobacco bales at the Lilongwe sales floors that had been delivered by tobacco farmers contracted by JTI, but that the company was refusing to buy the leaf.
    Some people at the auction said JTI had asked AHL and the Tobacco Control Commission to sell the leaf to other buyers, but that they, too, were refusing to buy it.
    Meanwhile, the Times’ source reportedly said that the same type of stand-off was occurring at the Limbe sales floors, but that JTI was still buying tobacco from the Mzuzu and Chinkhoma floors.
    ‘The bitter tobacco farmers were meeting late afternoon on Thursday to chart the way forward following the decision by JTI to abandon them after the company had signed a mutual agreement to let the farmers grow the tobacco for the JTI,’ the Times report concluded.

  • Grading system questioned

    Grading system questioned

    Malawi’s leaf-tobacco grading system should be improved to favor growers, according to a story in the Nyasa Times quoting the chair of the Parliament’s Agricultural Committee, Chidanti Malunga.
    The committee has asked the Tobacco Control Commission (TCC) to change its tobacco classification system because, in its view, the current system does not favor tobacco growers.
    During a committee visit to the Kanengo Auction Floors on the weekend, Malunga said better prices depended on improving the tobacco classification system, which currently left a lot to be desired.
    The Kanengo floors have been hit by low tobacco prices since President Peter Mutharika opened them last week. This is despite estimated production being well below perceived demand.
    The story quoted the CEO of the Tobacco Association of Malawi, Mathews Zulu, as saying that low production did not ensure good prices.
    Zulu said good prices depended on the production of ‘better leaf’ and improvements in grading.

  • Prices dip to US$0.80 per kg

    Prices dip to US$0.80 per kg

    Malawi’s tobacco growers will be hoping that the first day of this year’s sales is not a pointer to the rest of the selling season.
    According to a story in The Maravi Post, day one was marred by poor prices that came in as low as US$0.80 per kg.
    Growers were said to have been angry at the prices buyers were offering.
    They compared these prices with the work that went into producing the tobacco and found them wanting.
    This year’s selling season was opened on Monday at the Lilongwe Auction Floors by President Peter Mutharika, who urged buyers to pay good prices. But, in the past, even the urgings and threats of presidents have fallen on deaf ears.
    The poor start to the season occurred even though Malawi’s all-types crop is thought to be almost 14 percent below demand, due in part to unhelpful weather in some parts of the country. Tobacco production is estimated at 147.80 million kg against a demand of about 171.00 million kg.
    Inkonsi Mbwerwa, the board chair of the Tobacco Control Commission, was said to have ‘downplayed’ the low-price concerns, arguing that quality ‘contributes to its prices’.
    But, at the same time, the commission was said to be optimistic that Malawi’s tobacco might fetch high prices this year because demand was above the level of supply.
    Tobacco marketing is due to start on April 11 at Chinkhoma; on April 16 at Limbe; and on April 23 at Mzuzu.

  • Hoping for better prices

    Hoping for better prices

    Malawi’s all-types tobacco production is estimated to have dropped by 12 percent this season, according to a story on Journalducameroun.com.
    The country is thought to have produced 149 million kg during the 2017/18 production season, down from 171 million kg during the 2016/17 season.
    The Tobacco Control Commission’s CEO, Kayisi Sadala, said on Wednesday that growers had not produced enough tobacco this season to meet buyers’ demand.
    He attributed the production decline to natural causes. “The country faced natural disasters like prolonged dry spells in the southern part and erratic rains in the central region where tobacco is largely produced, hence the output drop,” Sadala was quoted as saying.
    The upside of this is that the Commission is optimistic that the forces of demand and supply will lead to a smooth marketing season.
    There was hope that this year’s leaf would attract better prices than those of previous seasons, when supply was high and demand was low, Sadala said.
    The 2017/18 tobacco marketing season is expected to open on April 11, with farmers due to deliver their crops to the Kanengo and Lilongwe auction floors.