A crowd sourcing exercise conducted by the Institute for Food Policy and Research International (Ifpri) indicates that farmers continue to get low prices on maize crop with some selling the commodity at K142 per kilogramme (kg) against the government set gate price of K200.
According to Ifpri’s July Monthy Maize Market Report, about 93 percent of the farmers who reported having sold maize in July, sold at prices lower than the minimum farmgate price of K 200 per kg set by the Ministry of Agriculture and Food Security in April.
Maize is an important crop in the country and, as part of the food component, it impacts the economy as it constitutes 45.2 percent of the Consumer Price Index (CPI), which is an aggregate basket of goods and services for computing inflation.
This means that any movement in the price of maize either way has a direct bearing on inflation.
So far, average maize prices have fallen by 18.1 percent as compared to the same period last year.
Reads the market report in part: “Average prices fell by 2.3 percent during the second and third week of July but returned to K175 per kg in the fourth week.
Currently, Malawi’s year-on-year headline inflation rate for June 2020 declined by 0.2 percentage points to 8.5 percent due to the softening of food prices, according to published figures from National Statistical Office (NSO).
Meanwhile, the country’s maize output is projected to increase by 8.8 percent from 3 391 924 metric tonnes (MT) in 2018/19 season to 3 691 866 MT in the 2019/20 season due to favourable weather conditions and an increased uptake of inputs by farmers.
The Ministry of Agriculture and Food Security put the annual national maize requirement at three million MT.
Agricutural analyst Tamani Nkhono-Mvula believes that unless government enforces minimum prices and farmers get organised, the farmgate prices that the government releases every year won’t be of any benefit to the farmer.