The $1 million (K360 million) cotton seed investment project by Quton may be thrown in jeopardy following farmers’ decision to sell their cotton to other companies other than the one designated to buy the cotton for seed.
Quton is a company headquartered in Zimbabwe with a subsidiary in the country which produces cotton seed.
It has embarked on the project of multiplying seed this year to help end the problem of importing cotton seed which the country had been facing the past ten years.
The company set up a K360 million seed multiplication project involving farmers to grow cotton for seed to be sold to Great Lakes Company who have been given the mandate by Quton to buy all the cotton meant for seed.
However, over ten cotton buying companies who have already set up centres in all cotton growing districts of Balaka, Nsanje, Chikhwawa, Salima and Karonga are offering higher prices since the kwacha appreciated a week ago. The move may compel the farmers not to sell all the cotton meant for seed to Great Lakes Company.
Quton general manager John Lungu confirmed in an interview in Salima during a field day on Friday organised by he Cotton Development Trust, Makoka Research and Quton that the farmers might be forced to sell their cotton meant for seed to the ginners who are offering higher prices.
Some of the ginners in Salima are buying a kg at K210 (about 5 cents) others at K220 (about 6 cents) while Great Lakes is buying at K180 (about 4 cents).
Siad Lungu,”This is a big challenge. If the ginners and the farmers are not patriotic then market forces will indeed take charge and those offering higher prices might buy all the cotton including the ones meant for seed. If that will be the case then Malawi will lose out. As Quton we have set up a huge seed factory which I am afraid will be turned into a white elephant if the farmers sell all the cotton to companies other than Great Lakes,” said Lungu.
He said he will take up the issue with relevant authorities to make sure that cotton meant for seed is protected and the country save forex.
Cotton Development Trust chairman Patrick Khembo concurred with Lungu that the Quton project of multiplying seed is beneficial to the country because forex will be saved once the country starts producing own cotton seed.
“My plea to the farmers is that they should not sell cotton meant for seed to other buyers and middlemen but to Great Lakes Company. All the farmers who grow the cotton meant for seed must respect their contract because they will benefit more since they will get a premium of 20% of the set price on any kilo sold after they have sold all the cotton,” said Khembo.
However, farmers interviewed during the function were adamant saying that they will be forced to sell the cotton meant for seed to those offering higher prices.
“We have a lot of needs that require money so if the authorities buying cotton meant for seed do not increase the prices now we will be forced to sell to those giving us better prices,” said Phillimon Zakeyu.
Malawi requires about 3000 tonnes of seed every growing season and once this project fails Zimbabwe and Zambia stand to benefit more.