AIP redemption Averages 18.5%

The impact of logistical hitches that have characterised this year’s Affordable Inputs Programme (AIP) have come to the fore as an average 18.5 percent of beneficiaries have so far redeemed their inputs.

Farmers Union of Malawi (FUM) has described the situation as worrying, especially considering that some farmers in the Southern Region have planted with the rains that have fallen so far. 

But Ministry of Agriculture has since attributed the low redemption rate to procurement processes the contracted private suppliers are currently undertaking to procure fertilisers and deliver to allocated areas.

In an interview yesterday, Ministry of Agriculture spokesperson Gracian Lungu said they are monitoring the private suppliers since their contracts stipulate a specific timeframe.

He said: “As a ministry we are very much aware that some private suppliers are still not on the ground to complement efforts by State enterprises such as Admarc [Agricultural Marketing and Development Corporation] and SFFRFM [Smallholder Farmers Fertiliser Revolving Fund of Malawi].

“But since contracts the private suppliers signed have a specific period for them to deliver, we are still monitoring them.”

Despite the situation, Lungu said the ministry’s sales monitor shows that in every two days, new suppliers are selling the inputs and further expressed optimism that more private suppliers will open selling points “soon”.

He also said the SFFRFM will soon start mobile vending, targeting areas where farmers are yet to start redeeming the inputs.

Lungu said that as of yesterday, the cumulative redemption rate was 18.4 percent with Chikwawa District having the highest rate at 52.2 percent and Nkhata Bay District the lowest at 5.7 percent.

But he could not provide statistics for the same period last year, saying he needed more time to check.

Ministry of Agriculture contracted 164 suppliers to take part in the retail, warehousing and distribution of the fertiliser.

But The Nation reported on November 18 2021 that 13 firms, including major agro-dealerships, have pulled out from the exercise despite being issued contracts.

The firms were Chipiku, Rab Processors, Kulima Gold, ETG, GYP Imports and Exports, Kelvam Enterprise, Tiwale Investments, Bakwena Investments, Milazi Holdings, Worldwide Wholesalers, Midima Holdings, Elite Engineering Supplies Limited and Nellie Investment.

But on November 19 2021, Minister of Agriculture Lobin Lowe told Parliament that government will not bow down to pressure from the suppliers and agro-dealers pushing for a raise in the price of the subsidised fertiliser to K35 000 per bag.

Currently, there are 380 Admarc markets and 162 SFFRFM markets.

In an interview yesterday, FUM president Frighton Njolomole said the delays by suppliers will lead to farmers planting late and will likely affect output.

“These challenges could have been prevented and it is sad that government cannot come in quickly to resolve these issues. Rains have started in many parts of the country, especially in the Southern Region and the earlier these issues are addressed the better,” he said.

Njolomole said with continuous rains, some areas may become impassable which will lead to farmers losing out. He said it is important for the Ministry of Agriculture to push the suppliers.

The challenges also come a month after small and medium enterprises (SMEs) were having challenges in getting contracts to use as collateral to get loans from commercial banks to buy AIP materials.

Our sister newspaper Weekend Nation reported on October 30 2021 that government issued most contracts to the SMEs who have had challenges to get loans from commercial banks without solid proof.

In an interview yesterday, Parliamentary Committee on Agriculture and Food Security chairperson Sameer Suleman said they will summon the Ministry of Agriculture to explain the numerous irregularities.

He said: “Things on the ground are not looking good. The programme is not going as expected. Actually, looking at the seeds, only 10 percent is being sold.

“So, the fear is that farmers will start using local maize which will likely affect the output because the seed may not be conversant with the fertilisers.”

Suleman further said Malawians were made to believe that the number of AIP beneficiaries was not reduced when in fact it was reduced from the initial 3.7 million to about 2.7 million.

But during the official launch of the programme, President Lazarus Chakwera directed that the number of beneficiaries should remain 3.7 million as planned.

In a separate interview, agriculture policy expert Tamani Nkhono Mvula said the developments surrounding this year’s AIP point to minimal success of the programme.

“Looking at the 18.4 percent population of those who have accessed the inputs, it is on a lower side. On the overall, we will not get to good percentages to certify that the programme has been a success,” he said.

Nkhono Mvula said with the rains expected to continue and suppliers not selling the inputs, it will result in beneficiaries going to distant places to redeem inputs resulting in an increase in costs.

On November 3 2021, The Nation reported that the Ministry of Agriculture proposed that members of Parliament (MPs) should transport the farm inputs, a move experts said would compromise their oversight role.

Rolled out in the 2020 agriculture season, AIP, just like its predecessor Farm Inputs Subsidy Programme implemented under the Democratic Progressive Party, has been beset by problems mainly bordering on logistics.

President Lazarus Chakwera launched the programme on October 16 2021 at St Theresa in Chiradzulu. The programme is expected to benefit 3.7 million smallholder farming households with an allocation of K140.2 billion.