Disappointed by low prices and finding no satisfying explanation for the situation, cotton farmers in Traditional Authority Mlumbe in Zomba suspect buying companies have colluded to offer low price for the crop this year.
The media visited the area on Wednesday and all the farmers spoken to told stories of how, after toiling in the field to grow the crop, the prices have remained “too low” for them to feel rewarded for their hard work and plan for the future.
The farmers suspected traders have conspired to buy the commodity at K90 per kilogramme which they said is low although it is actually higher than the K78 that government set as minimum price.
They said they expected the price to be not less than K180 per kilogramme, the rate at which they were selling the crop during the 2010/2011 season.
“We have no reason to explain this other than that the traders have colluded to give us this low price.
“What we know is that when there are several companies buying the commodity, there is competition which brings in different prices. That has not happened this year. All of them are giving the same price,” said one farmer, Allan Tchowa, of Kutchiri Village.
Government approved and registered 10 companies to buy the crop from farmers. The companies are Great Lakes Cotton Company, Malawi Cotton Company, Toleza Cotton Company, Iponga Cotton Company, Woget Cotton Company, Nadhi Cotton Company, Afrisian Cotton Company, Cotton Ginners Africa Limited, Admarc and Mapeto (DWSM) Limited.
Village Headman Mpalume, a cotton farmer himself told of his tale where he pulled money from his grocery shop into cotton farming hoping for the best.
“Despite government giving us some inputs like chemicals which were not enough anyway, we have struggled because this year we planted three times because of dry spells. I only got K123, 500 for my 13 bales. Last year, I could have got about K234, 000 for that amount of cot¬ton,” he said.
Gabriel Mchemo of Kutchiri Village, a cotton farmer for the past 17 years, said when they were planting the cotton, they were promised a price of not less than K200 a kilogramme.
“As a result a lot of people invested heavily in cotton farming in form of land, labour and chemicals, only to be greeted by prices lower than last year’s. We believe cotton buyers have colluded to rip us off,” he said.
The farmers also questioned why the prices of the crop have remained low even after devaluation of the kwacha by 49 percent.
“Our colleagues in the tobacco industry have had their fortunes improved after devaluation. Why are we being given these low prices?
“We are suffering twice in that the price is low and our earnings are eaten up by devaluation. This will kill cotton farming as we have no money to invest for next year after paying our bills,” said Tchowa.
The farmers said most of them had abandoned growing maize in the area in favour of the crop in the hope that they would get enough money to be able to buy food.
The area is known to be a rain shadow zone where maize production is often affected by unreliable rainfall patterns.
In response to the complaints, Ministry of Agriculture blamed international market forces for the low prices.
Principal Secretary in the ministry, Godfrey Luhanga, said the solution to the low prices is beyond the reach of the ministry.
“The big issue is that we export 95 percent of our cotton. As such prices are dictated by international market forces. Last year there was a high demand but now there is a slump, hence the effect on local prices.
“It is not a problem for Malawi alone. Farmers in Zambia are equally affected. As ministry we are not happy with the situation because we know farmers need money. But at the moment there is nothing we can do,” Luhanga said.
Asked why tobacco prices have appreciated with devaluation while cotton prices haven’t, Luhanga said “these things happen”.
“Last year tobacco prices were bad while cotton farmers were smiling. It is simply an issue of demand and supply.
“The only way out is for the country to improve on value addition so that we have many cotton ginners and oil pressers. Otherwise the country is exporting jobs,” Luhanga said.
In the 2011/12 national bud¬get, government allocated K1.6 billion in cotton development project as the country tries to invest in alternative forex earners beside tobacco whose fortunes have been declining in recent years.