Cotton Council of Malawi says farmers are expected to sell 23 000 metric tonnes (MT) of the crop this year, almost the same quantity produced last year.
The council’s executive director Cosmas Luwanda said on Friday during the launch of the cotton marketing season that they expect a smooth marketing season this year because farmers signed contracts with ginners to provide ready markets and to adhere to government-set minimum price of K400 per kilogramme (kg).
He said: “Our expectation is that the market will run smoothly. Critical to this year’s market arrangement is that it is contract-based where farmers were contracted to a particular ginner to sell their cotton.
“We expect farmers to stick to the arrangement and behave so that we build confidence and support the industry. ”
He said out of the 23 000MT of cotton produced this year, 20 000MT will be exported as lint to earn the country foreign exchange.
Luwanda said lack of support for farmers to grow cotton is affecting output, adding that in the past farmers used to receive free seed but with the adoption of hybrid seed, farmers are failing to access it.
African Institute for Corporate Citizenship acting head of programmes Leonard Chimwaza said there are about 150 market points established and hoped that contracts between farmers and ginners will be respected.
“As AICC, we are going to support farmers by ensuring that market committees and inspectors are well trained,” he said.
Chimwaza said with low production, the ginners will be scrambling for the commodity, which is expected to create competition and push up prices.
He advised farmers to aggregate their cotton to bargain for better prices above government-set minimum prices.
Cotton Farmers Association of Malawi president Dickson Gundani confirmed that they signed contracts with ginners to ensure better prices and buy all volumes produced this year.
“The contracts are binding, therefore, we expect price adherence from all ginners,” he said.
Agriculture policy development analyst Tamani Nkhono Mvula earlier called for value addition before exporting the crop.
He said most of the cotton is produced for overseas markets such as China, but with Covid-19, Malawi should not only invest in production, but also processing.
This year, government has set the minimum price of the crop at K400 per kg, a jump from last year’s K320 per kg.
Cotton is the country’s fourth foreign exchange earner after tobacco, tea and sugar.
Malawi exports 100 percent lint and cotton seed to Asia and South Africa.