Maize traders say lifting maize export ban now that farm-gate price of K180 per kilogramme (kg) has been released would be counterproductive.
The views by Grain Traders and Processors Association follow sentiments by Minister of Agriculture, Irrigation and Water Development Joseph Mwanamvekha on Saturday that lifting maize export ban, imposed two years ago, is an option government is looking at in the wake of a projected 355 000 metric tonnes (MT) maize surplus this year.
But in an interview yesterday, the association’s president Grace Mhango said maize prices in potential export markets are cheaper compared to the local market.
She said the grain in Rwanda, Kenya and Mozambique, is selling at $288 (about K211 000), $308 (about K226 000) and $290 (about K213 000) per tonne, respectively.
Said Mhango: “If indeed there is a genuine surplus then the
export ban is not necessary.
But removing the export ban when they have put another spanner on maize which is the high farm-gate prices still does not help with free movement of maize.”
For instance, she said to export maize to Kenya and Rwanda, they could spend between $150 (about K11 000) to $200 (about K148 000) per tonne whereas exporting to Mozambique, would attract transport costs of between $70 (about K51 800) and $200 (about K148 000) per tonne.
Mhango said besides that, there are certification agents cost, clearing charges and bank facility charges on both the buyer and the seller.
On her part, National Smallholder Farmers Association of Malawi (Nasfam) chief executive officer Bettie Chinyamunyamu said yesterday that while it is good for government to give clear intentions on policy direction for planning purposes, enforcement of minimum prices could ensure that farmers get value for money whether the ban is lifted or not.
She said government’s failure last season to enforce farm-gate prices led to smallholder farmers losing out.
Mwanamvekha said there is need to ensure security of maize supply before opening up the market.
The maize export ban, according to the Ministry of Agriculture, Irrigation and Water Development, was imposed to ensure that the country stocks adequate supplies for the strategic grain reserves.
International Food Policy Research Institute (Ifpri) in an earlier study said the maize export ban imposed after the 2016/17 harvesting period cost Malawi K69 billion in potential export revenue.
Within the ban period, wholesale maize prices in the country were said to be between 45 to 70 percent lower than in Kenya, Rwanda and Tanzania, according to Ifpri.
Export restrictions on staple foods or cash crops are frequently imposed in developing countries to promote food security or industrial development goals.