Local fertiliser firms outline AIP challenges

Fertiliser Association of Malawi says the current design of the Affordable Inputs Programme (AIP) is marred with inefficient targeting, mono-cropping and uncontrollable costs.

In its assessment of the subsidy programme, the Tonse Alliance introduced in 2020 to replace the Farm Input Subsidy Programme, the association’s executive administrator Mbawaka Phiri said the programme targets all smallholder farming households that have their identity data captured in the national database, thus making it a universal programme.

She said with mono-cropping, as AIP offers maize seed and maize suitable fertiliser, farmers are discouraged from adapting to many other cash crops that would add to a variety of agriculture produce that Malawi can export.

Said Phiri: “Due to the fact that Malawi imports all its fertiliser, up to 80 percent of retail cost of fertiliser in Malawi is largely determined by global  market forces, therefore, Malawi is a price taker that cannot mitigate against the global price increases.”

She said there is need to redefine who qualifies as a beneficiary under the programme as well as consider offering subsidy on key legume crops that are exportable, assisting in the recent push to find cash crop substitute for tobacco farmers.

According to the association, cash crops that can be added to the subsidy programme include soya, groundnuts, beans, sweat potato, cassava and pigeon peas.

To justify this, the association argues that based on the 2022 government minimum farm-gate prices and at current yields, maize, the main off-taker in the subsidy programme, was sold at $202 per metric tonne (MT) while soya was sold at $342 per MT while in terms of earnings, maize generated $921 000, far below soya’s $219 000, an indication that if it received a boost, the earning could have been far above those generated from maize.

In the 2022/23 National Budget, AIP has claimed K109.5 billion, representing 85 percent of the agriculture sector budget.

However, the allocation was not enough to cater for the earmarked farmers and it took some donors to support the country with 92 000MT of fertiliser.

The allocation is a K33 billion decline from the previous year’s K142 billion allocation.

The number of AIP beneficiaries was reduced to 2.5 million from 3.7 million the previous season.

Minister of Agriculture Sam Kawale said only 66 percent of AIP beneficiaries had redeemed all their inputs as of end January.

The figure means about 825 000 of the 2.5 million beneficiaries were yet to access the fertiliser as at January 31.

Kawale said redemption will only be concluded when all beneficiaries have accessed the inputs.

However, at this stage of the agriculture season, maize crop is almost halfway to maturity in most parts of the Southern Region.

A study on Malawi conducted by London-based think-tank Legatum Institute titled ‘Pathways to prosperity’ challenged government to enhance agricultural productivity through mindset change by moving away from fixed subsidies to increased private sector participation, among others.

President Lazarus Chakwera is on record as having said one of the exit strategies for the AIP is ensuring that farmers’ incomes increase.