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Admarc posts K14 billion loss

Agricultural Development and Marketing Corporation (Admarc) general manager Rhino Chiphiko has revealed that the company has recorded a K14 billion loss in the past financial year, instead of the projected K3 billion profit.

He said this yesterday when Admarc officials appeared before the Budget Cluster Committee of Parliament on Agriculture and Food Security and the Committee on Natural Resources and Climate Change in Lilongwe to brief them on the status of the company.

He said lack of funding to buy more crops affected the company and it has found itself in a deeper problem.

Chiphiko: Lack of funds affected us

Chiphiko said: “We wanted the money so that we could buy more cash crops, but the money that we had mostly covered maize. Maize is not something you would expect to make profits from.”

The firm had planned to source K95 billion to buy 410 000 metric tonnes (MT) of maize and cash crops, but it only secured K25 billion and bought 133 000MT of maize and other crops.

Delays in accessing funding also affected Admarc operations as it went on the market late when most of the farm produce had already been bought.

Chiphiko also lamented government’s farm gate prices, saying they are sometimes too high to make business sense.

“For Admarc to properly function, there is need for early financing so that it can buy crops on time. The funds should also be adequate,” he said.

This year, the State-run grain trader needs K48 billion to buy maize and commercial crops.

Chiphiko said Admarc also needs mobile grain drying equipment to enable it to buy maize early and stock it at optimal moisture levels. 

“The equipment will help reduce moisture content in the grains so we will be able to buy early and dry the crops, but also stock them. The equipment is needed in all 15 Admarc districts,” he said.

Admarc had further asked government to start providing the company with letters of credit to buy fertiliser from manufacturers.

He wondered why it is easy for government to issue letters of credit to private traders and fail to do the same for Admarc.

He said Admarc can properly handle the fertiliser business if government supports it and that will also end cartels in the fertiliser industry.

On his part, co-chair of the cluster Sameer Suleman sympathised with Admarc for failing to access funding to meet its operations. 

He said the cluster will push for more financing in this year’s budget. He stressed that Admarc has to be allocated not less than K50 billion. 

“We will block the Agriculture Vote if Admarc does not get the money. If the worse comes to the worst, we will reject the budget. 

“We need to do the right thing. Admarc has capacity to perform, but people are benefiting from the current status of Admarc. When Admarc finds a buyer for crops and asks for an export certificate, it is not given the certificate, instead the certificates first go to Indians so that they make business. We are killing Admarc,” lamented Suleman.

Currently, Admarc is haunted by debts and the institution owes banks in excess of K64 billion.

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