Research conducted by National Smallholder Farmers Association of Malawi (Nasfam) has found that farmers are not benefiting from the integrated production system (IPS) of selling tobacco—also called contract farming—because of numerous challenges.
Some of the challenges, according to the research findings, include lack of legally binding contracts between farmers and buyers and the secrecy in terms of prices at which buyers will have to pay for the leaf.
Reads part of the research: “On the growers’ perspective, there is little understanding of the loan, especially when it is in foreign currency. The farmers do not retain contract copy and merchants give quotas to farmers contrary to Tobacco Control Commission [TCC] licence.”
The research findings were released on Thursday in Lilongwe during a stakeholders meeting aimed at getting feedback to be incorporated into the final report.
Another bone of contention in IPS, according to the research, is that tobacco growers are forced to open multiple bank accounts and that new technologies are introduced at “awkward times” of the season.
Nasfam deputy chief executive officer Betty Chinyamunyamu, in an interview on the sidelines of the meeting, said the research was commissioned to bring to light some of the issues about IPS, which Nasfam thinks need to be rectified.
“As Nasfam, we believe that IPS is the way to go on tobacco production in the country. However, we also think that there are a number of issues that need to be addressed if the system is to start benefiting farmers.
“As such, we hope that relevant stakeholders will respond to recommendations to be made in this report,” she said.
Since its inception in 2012, IPS has attracted a lot of criticism from individual growers, growers’ associaitons and AHL Group, among others.
Alliance One Malawi, one of the tobacco buying companies which contracts growers, believes that there are some issues that need to be addressed in IPS.
The company’s leaf production manager, Ron Ngwira, in an interview said certain issues cannot be dealt with uniformly by the buyers such as harmonisation of extension services when new technologies are introduced.
“It is not easy to say that buyers must harmonise their extension services because they are looking for different products from the growers with each one of them giving extension services that will bring out the tobacco they are looking for,” he said.
But deputy chief executive officer of Tobacco Control Commission (TCC), David Luka, said growers are criticising IPS because of lack of knowledge. n