A record maize harvest in Malawi
08 May 2007
Malawi has a chronic hunger problem, with over one-fifth of the population
unable to meet their daily food needs. One cause of the food shortage has been
the poor crop harvests that the country has suffered for many years. However, in
2007 Malawi is on course for a bumper harvest, with the Ministry of Agriculture
predicting a surplus of 1 million tons of maize.
The harvest of 2006, too, produced a quantity of maize that exceeded the
country’s needs. Behind these record results is the Government of Malawi’s
fertilizer and seed subsidy programme, introduced in 2005 and co-funded by DFID.
This programme, which allows Malawians to buy fertilizer and maize seed at
better prices than in the past, has already benefited some of the country’s
poorest people, and, if its successes are built on, should help secure Malawi’s
food supplies into the future.
Better prices for Malawi’s farmers
Through
the programme, around 2 million households were able to buy fertilizer at the
subsidised price of $7 per 50 kg bag (less than a third of the retail price),
and make a saving of $2.80 on seed. For distribution, the Government used
private sector agricultural dealers as well as state-owned outlets, enabling
customers to choose, for the first time, where they bought from. This important
step forward was made possible by DFID funding.
In 2005, subsidised seed and fertilizer were available only through state
outlets, with only one type of each on offer. This was bad for business for
dealers in the private sector and limiting for farmers. But in 2006, when over
$25 million of subsidised sales were accessed through the private sector,
farmers finally had a choice of type, brand and pack size of seed.
The seed companies welcomed this new approach and placed a wide range of stock
in both kinds of outlet. Around three-quarters of customers used their subsidy
to purchase hybrid seed, even though it was twice the cost of the improved
open-pollinated varieties that were available. This showed that the smallholder
farmers had good product knowledge, and was the main reason why, in the 2006/07
planting season, the total size of land planted with improved maize seed was
130,000 hectares greater than in the previous year.
Bigger harvests help Malawi’s poor
This
increase in the use of improved seed contributed an additional 200,000 tonnes of
maize to the harvest, the benefits of which will be felt at several levels in
Malawi. With a lot more maize now available, the very poor in rural areas have
better access to food, and the lower food prices mean higher real incomes for
households, especially the poorest.
Although it is difficult to show the impact of individual factors on maize
production, results from an independent evaluation suggest that the subsidy led
to an additional 300-400,000 tonnes of maize being produced in 2006 and
600-700,000 tonnes in 2007. These figures remove the impact that better than
average rainfall may have had on the maize yield. The value of this extra
production has, in 2007, been between $100 million and $160 million, which far
exceeds the $70 million cost of the seed and fertilizer subsidy.
Securing food supplies into the future
The challenge for Malawi now is to build on the successes of the past two years.
The programme has enjoyed wide popular support, and although there is still
disagreement on implementation, all parties represented in Parliament are in
favour of it, which is unusual in a politically divided country. Importantly,
the Government is committed to keeping a subsidy programme at the heart of its
food security strategy for more years to come.
DFID is developing a four-year programme to support continued food
security in Malawi. Malawi would greatly benefit from solid private sector
markets for agricultural "input" products like seed and fertilizer, and a key focus of DFID’s support will be to stimulate such markets. Support will also be given to
dealing with the impact that these input products have on output, and on offering more
choice to Malawi’s farmers.
The fertilizer and seed subsidy programme has, so far, yielded some impressive
results. But it is crucial that the gains that have been made are not lost, and
that the right kind of work is done to go on fighting Malawi’s hunger problem.
In the words of Patrick Kabambe, Secretary for Agriculture: ‘We have made a good
start in terms of tackling food security issues in the country. The achievements
we have made in the past two years need to be sustained. Fertiliser alone will
not do the magic.’
Key Facts
- DFID provided over $8 million of the total direct donor funding of over $10 million for the agricultural inputs subsidy programme. This went towards logistics support and the provision of subsidised seed. An estimated $4 million was provided as indirect funding through budget support.
- The inputs programme cost $50 million in 2005/06 and $70 million in 2006/07. Approximately 140,000 tonnes of fertiliser and 6,000 tonnes of seed were sold at subsidised prices in 2005/06 and 175,000 tonnes of fertiliser and 5,000 tonnes of maize seed in 2006/07.
- The independent evaluation team that investigated the impact of the subsidy on the harvest comprised experts from Imperial College London, Michigan State University and Malawi.
- The four-year continuation of support to the inputs subsidy programme will begin in 2007, and will bring DFID's total spend on support to over £20 million.
- Africa's leaders have committed themselves to making progress on agriculture to enable growth and reduce hunger and poverty. The African Union's
New Partnership for African Development (NEPAD) has developed a
Links
- Eliminating World Poverty - DFID's White Paper
- Growth and poverty reduction: the role of agriculture
