Report hails tobacco contract farmin
A study conducted by NKC Independent Economists has praised Malawi’s adoption of the Integrated Production System (IPS) approved by President Joyce Banda last year.
The report, titled ‘Understanding the integrated production system of Malawi’s tobacco industry,’ and commissioned by the International Tobacco Growers Association (ITGA), was launched on Tuesday in Lilongwe.
“Information from the major buyers indicated that IPS had translated into improved leaf quality, lower levels of non-tobacco related material [NTRM], higher yields, a decline in costs and more sustainable farming enterprises,” said Christie Viljoen, a lead economist in the research when presenting official findings to journalists.
IPS is a production agreement which sees the tobacco buyer directly involved in crop production and entails, among others, a signed contract between the farmer and buyer with the latter contributing varying inputs, financial support.
During the 2013 tobacco marketing season, it is estimated that approximately 69 percent of all tobacco sales in Malawi were transacted under some form of IPS.
According to Viljoen, during last marketing season, buyers identified improved flavour, colour, texture and throw quality as among many benefits of IPS.
“Other marked benefits identified by farmers such as having access to financial services was the fact that surplus income was generated and had been used to purchase transport equipment, build houses and finance educational needs,” he added.
He said in some instances, farmers on IPS were able to increase their good quality tobacco from less than 30 percent of the crop during the 2010-11 to more than 60 percent during the 2012-13 season.
Viljoen also said purchase statistics for 2013 underscored the fact that IPS prices were systematically higher compared to auction prices.
“The report found that the majority of stakeholders in Malawi are in favour of IPS and the Tobacco Control Commission’s goal is to promote it as the ultimate model of tobacco production for Malawi over the long term,” he added.
During the launch, ITGA president Francois Van der Merwe said IPS is not a new concept to Malawi and that TCC has actively been promoting its regulation and adoption since 2012.
