Beating the odds through tobacco contract farming

Due to economic challenges, Thomas Matanda Shawa, could not continue with his formal education. He eventually dropped out of school in Standard Seven, but had one weapon to use to fight his way up to success—farming.

“My parents were very particular in training their children to do farm work and I am thankful to them for that,” explains Shawa, now an established tobacco grower, who comes from Kazengera Village, Traditional Authority (T/A) Nkukula in Dowa.

He went into serious tobacco growing at the age of 21 and struggled for four years with little success.

It was not until 2011/2012 farming season that Shawa hit the jackpot. This was after he had joined contract farming otherwise known as Integrated Production System (IPS) with JTI Leaf Malawi Limited, and for the first time, he raked home a fortune at the end of the season.

IPS is an arrangement that government duly approved in 2012 to allow tobacco growers and buyers to go into an agreement.

Under the arrangement, the expectations of the grower and the buyer are made clear and the partnership ensures best yield from the land and a higher quality crop for sustainable returns every year.

For five years now, 31-year-old Shawa is a farmer under IPS and in partnership with JTI. He is also chairperson for Mchenga Tobacco Farmers Club in the area.

Unlike before, he now has a lot to show for the five years he has been growing tobacco in partnership with JTI.

“Contract farming helps growers produce quality leaf desired by the buyer and this in turn fetches good returns for the farmer,” explains Shawa. “This arrangement has really transformed my living standards. I have managed to build a modern house and buy a brand-new one-tonne pickup to ease transportation of my tobacco to the market.”

Shawa has also managed to buy cattle and a piece of land along the Lumbadzi-Dowa Road, besides having enough food in reserve for his family and the people he employs to handle his tobacco.

A tour to Shawa’s one-and-a-half hectare of hybrid tobacco and to his house clearly reveals why he is a happy farmer.

At the field, one is met with a beautiful green stretch of tobacco with stems tall and heavily laden with quality leaf. At the back of his house, there are barns full of cured leaf.

In contrast, tobacco farmers just next to Shawa’s field have harvested little yield this year because of the rainfall pattern that has not been favourable.

He explains: “That is where a contract farmer differs from a farmer who is not under contract. For first four years since I have been growing tobacco, what you are seeing in these tobacco fields nearby was exactly what I used to experience until I went into partnership with JTI.

“The main advantage with contract farming is that there is always high level of interaction between the grower and the buyer and the leaf is monitored right from the nursery to the final product.”

Shawa says JTI’s leaf technicians have always worked closely with tobacco growers and following their advice and extension services, the growers have built box ridges to trap water within the ridges as one way of beating the dry spell.

JTI also provided the farmers with the right seed, fertilisers and all the required materials for the production of the desired quality of tobacco.

The tobacco firm also provided their contract farmers with fertiliser and maize seed for them to grow and have enough staple food to allow them work in their tobacco fields uninterrupted.

“Our contract buyer knows that when the farmer has no enough food, he would either be tempted to sell his tobacco to vendors or he will spend time looking for food. So, JTI provides us with everything so that we spend all the time in the field,” explains Shawa.

Five years in partnership with JTI, the enterprising farmer is not without followers. Luka Aaron is among the farmers who have not just admired Shawa’s success, but joined the buyer-grower partnership too.

Aaron admits that he was a tomato farmer, but could not help it after seeing the success Shawa has registered through his partnership with JTI.

This 2015/2016 growing season, Aaron, a member of Shawa’s Mchenga Club, has grown hybrid tobacco on 2.5 hectares in partnership with JTI.

He summarises the benefits of IPS as follows: “We get continuous monitoring at every stage of production, so, in the end we are rest assured that we have produced the desired quality,” explains Aaron, adding: “Besides, this process minimises reoffers at the market.”

The growers further agree that working close with a buyer also checks the issue of child labour, which is another serious challenge affecting the tobacco industry in Malawi.

IPS is currently being run as a government approved policy regulated by the Tobacco (Integrated Production System) Regulations of 2014 (IPS Regulations) in parallel with auction system.

The current split between the two systems is 80 percent in favour of IPS and remaining the traditional auction system.

The IPS Regulations and policy guidelines are yet to be enacted into the long-awaited Tobacco Act to ensure that the interests of both the grower and the buyer are adequately provided for and protected by the law.

However, when all is said and done, perhaps the merits of IPS may best be measured not only by what one farmer, Shawa, in Dowa has achieved in five years.

The merits may also be measured best by the quality of the leaf Shawa, Aaron and other farmers under the system have managed to achieve even in the wake of the 2015/2016 adverse rainfall pattern.

Tobacco still remains Malawi’s main cash crop, bringing in 60 percent of the country’s foreign exchange and contributing 13 percent to gross domestic product (GDP).

However, there are growing concerns from anti-tobacco lobbyists such as World Health Organisation (WHO) for countries to stop growing tobacco due to its negative health effects. n