Despite Malawi Government only allocating 20 percent of tobacco to be sold through the auction system, some farmers in Lilongwe say the system is better than contract farming.
They argued there is competition in the auction system than in the IP system.
“One of the things I have observed at auction, farmers have an option not to sale their tobacco when prices are low, a thing which does not happen in contract farming,” said Stenani Kwenda, who has been growing tobacco for over 10 years.
Other farmers, Heston Maseko and Lamissoni Million said they once grew tobacco on contract, but the bales were critically looked at and any single mistake found meant that they could be rejected.
Million, on his part said, he finds the IP system more secretive because in the contracts the farmers signed with the buyers, there are no prices mentioned.
“The contracts we sign with buyers do not indicate prices for different grades of tobacco, a thing which put me off and this year I will sell my crop at the auction floors,” he said.
But the Tobacco Control Commission (TCC) chief executive officer Dr Bruce Munthali has argued that contract farming helps farmers produce quality leaf and earn more money.
“Contract farming is advantageous because the quality is always good and farmers stand a better chance of getting good prices,” said Munthali.
Tobacco is the number one foreign exchange earner contributing over 60 percent to the forex buffer, 13 percent to the national economy and supports millions of Malawians directly and indirectly.