Growers want Contract Farming Act
The Central Region Tobacco Growers (CRTGA) has asked Malawi government to regulate the newly-adopted Integrated Production System (IPS) by formulating the IPS Act.
The association’s plea is on the premise that IPS, commonly referred to as contracting farming, has proven to offer tobacco growers good prices; hence, the need to safeguard the improved prices by legalising the system.
“We are asking government to come up with an IPS Act just to ensure that what is happening under IPS policy is embedded in the country’s laws. We are convinced that the IPS is the way to go in terms of the future of the tobacco industry in Malawi,” said CRTGA president Ernest Chadzunda in an interview on Wednesday.
Chadzunda said contracting marketing at the country’s auction floors is not included in the country’s Tobacco Act, which guides operations in Malawi’s tobacco industry.
IPS, which President Joyce Banda approved earlier last year, is an initiative in which tobacco buyers combine farming and marketing strategies by dealing directly with farmers in producing the leaf.
The system has started being implemented from the 2012/13 tobacco growing season and allows the traditional auction floors only handling 20 percent of the total volume of tobacco produced, estimated at 156 million kilogrammes, according to the Tobacco Control Commission (TCC).
“We are holding fears that without the [IPS] Act, anyone would just wake up and discontinue this system, but with the Act in place, it would be difficult for the system to be stopped since it would be unlawful,” added Chadzunda.
He also said with IPS Act in place, growers would know the minimum prices of the leaf in advance which he said would be good for planning in the following farming season.
TCC chief executive officer Dr. Bruce Munthali was not available for comment as he was reportedly in a meeting.
But he told Business News in an interview in Lilongwe recently that the IPS will help propel the use and adoption of new tobacco technology among tobacco growers and help offer tobacco growers pre-determined prices.
“Our embracement of IPS has moved Malawi to a core market from an opportunity market. Our tobacco has both good nicotine and firing characteristics,” he said.
Minister of Agriculture and Food Security Peter Mwanza also said in Lilongwe during a Japan Tobacco International (JTI) filed day that the formal introduction of IPS will further consolidate its relationship with farmers and other tobacco stakeholders.
President Joyce Banda said when she opened the 24th annual congress by Tama a week ago that her administration has approved the new tobacco production system in order to fight against external shocks affecting tobacco industry.
But other tobacco stakeholders expressed discontent last year over the adoption of the new tobacco production system saying it is bound to render more growers destitute and economically stranded since a group of farmers left out of the arrangement could constitute well over 60 percent of all tobacco farmers.
