The Civil Society Agriculture Network (Cisanet) says dairy farmers in the country continue to face challenges in accessing markets as well as covering costs related to the production of milk.
The sentiments follow a report from study findings which CISANET commissioned on milk pricing. The study, among other things, sought to provide policy recommendations to improve competitiveness in the dairy sector.
Cisanet national director Pamela Kuwali said recently that their discussion with stakeholders shows the need for more studies on issues that affect the dairy industry.
“There is a general perception by milk producers in Malawi that suggests they get low farm gate prices for their raw milk. As a result, the farmers are of the view that they realise low returns from their dairy enterprises,” she said.
Kuwali said because of other challenges, raw milk pricing remains a thorny issue and a tug of war in the dairy value chain in Malawi as processors claim to be paying decent prices for the raw milk while producers, on the other hand, claim to be getting a raw deal.
“It is our belief that this study provides us with the necessary basis for initiating a healthy dialogue among all players in the value chain to ensure a more fair distribution of risks and benefits between milk producers and processors,” she said.
Lilongwe Dairy managing director Edwin Chilundo said there is need to clearly understand the pricing mechanism as the price of milk is relative and dependent on the quality of the milk itself.
“Sometimes we have problems with the adulteration of milk and productivity. When we compare with the region in terms of the quality of milk, the chemical balance in the milk shows that our price is very competitive.
“When we look at the region, we are the only ones with a significant disadvantage because we are charging a tariff that is less than what the rest of our contemporary countries like Zambia and Zimbabwe are charging,” said Chilundo whose company is one of the leading milk processors in the country.
Ministry of Agriculture, Irrigation and Water Development deputy director of animal health and livestock development Patricia Mayuni advised rural farmers to be conducting gross-margin analysis and use the details to negotiate with the processors by showing them what it takes for a farmer to produce milk. n