Cotton price jumps 195% above minimum
Cotton farmers continue to smile all the way to the bank as the buying price for the commodity in all the markets except Karonga, has jumped more than 195 percent above the government set minimum price.
Government through the Ministry of Agriculture and Food Security set the minimum farm-gate price for cotton, one of the country’s strategic crops, at K78 per kilogramme (kg) for grade A, K3 up from last year, while grade B was put at K63 per kg, which is K7 lower than last year’s K70 per kg.
Ctton Farmers Association of Malawi (Cofam) president George Nnensa told Business News on Wednesday that prices are ranging at between K200 and K250 per kg.
“The prices are good and farmers are not complaining. Competition among the buyers has contributed to good prices,” he said.
But Nnensa is worried with the K150 per kg buyers are offering in Karonga, attributing it to a lack of competition because there are only two buyers, Nadhi and Agriculture Development and Marketing Corporation (Admarc).
He hoped the price would pick-up to the satisfaction of the farmers.
Earlier, Cofam called for the review of the minimum buying price of seed cotton, arguing that the devaluation of the kwacha that recently hit the economy affected the prices of inputs such as pesticides which went up.
At the opening of the cotton markets this year, buyers were offering K90 per kg before the prices went up to above K150 per kg.
Cotton Development Trust (CDT), a public private partnership institution in the cotton sector, anticipated cotton output would have doubled in the 2012/13 season from last year’s 110 000 metric tonnes to about 200 000 metric tonnes.
But Cofam could not give the figures, saying they would have to wait for the selling season to end.
Production in last season went up to an estimated 110 000 metric tonnes from 52 456 metric tonnes the year before, according to figures from the purchases made by cotton ginners in Malawi.
The rise can be attributed to the response on the prices on the 2011
marketing season when seed cotton prices went up to a record K200 per kg which stimulated farmers to grow a larger crop with expectation that the price would be maintained.
Cotton is grown by more than 200 000 farming families in the cotton growing areas of Shire Valley, Balaka, Machinga, Phalombe, Blantyre, Mwanza, Neno and Karonga.
Currently, Malawi exports 95 percent of the cotton while the remaining five percent is processed locally.
