Malawi spells out IPS challenges

Malawi Government has said despite the Integrated Production System (IPS) of selling tobacco bearing fruits, it has its share of challenges that need to be resolved.
Minister of Agriculture, Irrigation and Water Development Allan Chiyembekeza has admitted that tobacco contract system the IPS has a number of challenges.

The minister made the admission in Parliament on Monday when he read out a ministerial statement on the national food situation outlook and some of the achievements that his ministry has made in the past months.
IPS generally provides for contract farming of tobacco and direct facilitation of growers by processors and buyers.
The system is running side by side with the traditional auction system of marketing tobacco, but since its approval by former president Joyce Banda in 2012, the system has been a subject of intense debate with other tobacco stakeholders blaming the system of fuelling poverty, especially on auction system farmers.
And Chiyembekeza said despite the system having several advantages, cited duplication of contracted growers among tobacco buying companies, systems slowness, weak enforcement of regulations as some key challenges gripping the system.
Other challenges that Chiyembekeza singled out include low bargaining power among smallholder farmers for good prices due to high illiteracy levels as well as limited advocacy levels.
“All these challenges justify the renewed effort on the part of government to ensure that neither the farmer nor the buyer gets a raw deal in the production and marketing of the crop,” said Chiyembekeza.
The minister said in order to deal with the challenges, his ministry has facilitated the review of the tobacco growers registrations so that starting in the 2015/16 growing season, registration will be done using a new biometric registration system which he said is robust.
Chiyembekeza also touted the new system of registering growers as more efficient and farmer-friendly since farmers will be allowed to register closer to their homes.
“More importantly, Mr. Speaker, Sir, my ministry is fanalising the review of the Tobacco Act and development of the Contract Framing Policy and Regulatory Framework to support implementation of IPS,” he said.
Commenting on the success stories of IPS, Chiyembekeza said ever since the implementation of the system started, total burley tobacco sold through the system has been on the increase.
For instance, Chiyembekeza reported that IPS constituted 45 percent which is about 29.1 million kilogrammes, 69 percent which translates into 100.3 million kg and 76 percent which is about 121.9 million kg of the total burley tobacco sold in 2012, 2013 and 2014, respectively.
He also said the system has increased buyer and merchant confidence, and increased investments that tobacco merchants make inform of loans to farmers and extension services.
Beginning this year’s marketing season, government has changed the initial allocation of the tobacco volume to 70 percent contract and 30 percent auction from the earlier 80 percent contract and 20 percent auction.
The two systems are also running daily side by side unlike previously when contract sales were allocated three days while auction sales were done for two days per week only.