Cotton Ginners Africa Limited (Cgal) has set minimum price of cotton at K375 ($0.61) per kilogramme (kg), a rise from the current price of K250 ($0.41) per kg.
The new price is good news to cotton growers in the country and will raise hopes that next year the farmer will realise better returns.
Cgal managing director Spencer Zinyemba, briefing the press in Blantyre on Wednesday, said the cotton ginners want to restore the image of the cotton sector in a bid to turn the crop into a main forex earner
He said ginners are also committed to helping cotton farmers in the country to realise reasonable proceeds from their crop.
“Cotton is the reason why we are here and we would not make any mistake [to offer poor farmers low prices]. Farmers are producers and we have to look after them. Their outcry has been poor prices. They ought to know the value of the crop before they start preparing for the season,” Zinyemba said.
He said Cgal will provide seed to the contracted farmers on credit at K1 200 ($1.97) per kg, but also provide extension services to ensure that cotton produced next year is of high quality.
Cotton, which is the country’s fourth largest cash crop after tobacco, sugar and tea, generates an estimated K5 billion annually.
Experts in the sector have argued that the crop has huge economic potential and could rake in substantial amount of foreign exchange, in excess of $500 million (about K306 billion) each year.
However, production of the crop has over the years declined due to among others, poor prices on the market and lack of farm inputs.
On his part, Cotton Farmers Association of Malawi (Cofam) president George Nnesa commended Cgal for the initiative saying it will help farmers who most times face hurdles to access basic inputs for production.
He said farmers have also over the years suffered losses from their production due to poor prices that characterise the sector.
“Farmers are left deprived every growing season as they fail to realise gains from their hard work on account of poor prices and lack of inputs.
“This gesture by Cgal is, therefore, commendable for it will help turn around things in our sector,” he said.
The crop—which is largely grown by smallholder farmers in Balaka, Chikwawa, Nsanje and some lakeshore districts such as Salimaa and Mangochi—is estimated to be grown on 80 000 hactares in Malawi and accounts for seven percent of farming families, according to government statistics. n