Illegal maize exports up 76% amid export ban
Illegal maize exports to Tanzania and Kenya have increased by 76 percent, which is above a five-year average due to increasing demand for grain in the East African region.
This development comes on the backdrop of a maize export ban issued by the Ministry of Industry, Trade and Tourism at a time the country has produced a surplus of more than 30 percent surplus in the staple grain.
The maize export ban has irked stakeholders, including the Malawi Confederation of Chambers of Commerce and Industry (MCCCI), which argues that government is missing an opportunity to bring in foreign exchange to help prop up the economy.
Information sourced from the United States Agency for International Development (USaid) hosted website Famine Early Warning Signs (FewsNet) shows that while informal maize imports reduced significantly following the moderate production in 2017, informal cross- border exports to Tanzania and Mozambique through central and southern Malawi districts were recorded at 1 769 tonnes in June before slightly dropping to 1 750 tonnes in July.
Maize prices have crushed on the local market, selling at around K50 per kilogramme (kg) translating to K2 500 for a 50 kg bag.
Recently, State produce trader Agricultural Development and Marketing Corporation (Admarc) has been buying maize from farmers at K170 per kg, but our source said in Tanzania, maize is being bought at 620 shillings, an equivalent of K206 per kg.
In an interview, MCCCI chief executive officer Chancellor Kaferapanjira said they have been advising government to give Admarc and National Food Reserve Agency (NFRA) money to buy enough maize for storage and that the rest of the grain be exported.
When asked on the informal maize exports amid a ban, Ministry of Industry, Trade and Tourism spokesperson Wiskes Nkombezi said ministry officials are not present at borders and they leave everything in the hands of law enforcement agencies to do the job.
The ministry argues that the ban on maize exports is in line with the Control of Goods Act, which designate maize as a strategic commodity.
Farmers Union of Malawi (FUM) president Alfred Kapichira-Banda faulted Admarc for its late intervention on the market and piecemeal purchase of maize which has given the opportunity to intermediate buyers to take advantage of the maize prices.
Farmers are earning less than normal by selling their cash and food crops at below-average prices. In some cases, farmers are selling maize for as low as K50 per kg and soya beans for less than half the prices in the previous marketing season.
FewsNet report shows that in Salima average prices for June dropped by 19 percent since April and the price in June is nearly 50 percent below prices in June 2016 and eight percent below the five-year average.
In Karonga, average maize grain prices dropped to levels that are 39 percent below the five-year average and 27 percent below average prices in June 2016, according to the report.
Since Admarc started buying maize from farmers, agriculture stakeholders argue that their intervention is not helping. n
