How Admarc runs dry of maize

By Cathy Maulidi:

On Thursday, Admarc markets opened for sales of maize to Malawians – to the disappointment of buyers as a considerable number of stations of those that opened in Blantyre and other parts of the region did not have the grain.

Friday, we accompanied the Parliamentary Committee on Agriculture on its visit to Chilambula and Malangalanga Admarc warehouses to assess the availability of the maize in those facilities.

Last year, they were fully stocked with maize. Today, they are empty, with not even a single bag.

The maize that Admarc has started selling is not coming from the parastatal’s warehouses because Admarc does not have any stocks of its own.

So what happens with Admarc maize?

Senior ranking officials at both Admarc and Capital Hill report of one of the schemes that has been bleeding the reserves of Admarc: the statutory institution processed a number of maize transportations and purchases last year and government only stepped in to stop the sales while it was already too late.

“Admarc sold the maize to traders and that left the depots completely empty. If you ask them now, they will tell you the maize was for business but that was a deliberate move as now government will go back to buy the same maize from traders it sold the grain to,” said one of the sources whose name we will withhold.

The scheme, according to our sources, is that some of the firms have connections with political bigwigs who want to make a killing when government purchases the maize to restock the shrinking or even empty reserves at the time of need like this one when 4.4 million Malawians are facing acute food shortage.

In one of the transactions some of whose documents we have seen, Admarc sold 1,000 metric tons to a firm [name withheld] in June last year from its Limbe and Luchenza depots.

The sole trading business paid a total of K205 million for the maize and it bought the maize at the price the buyer had already fixed.

It is understood that some traders purchased as much as 5,000 metric tones at the time.

On the face of it, this is a normal business transaction, but sources said it is not because that sale is the beginning of the pipeline through which Admarc maize is purposefully drained out to be resold to government at a huge profit.

Asked about these transactions, Minister of Agriculture Sam Kawale said: “I can’t comment because I don’t have the details of the transactions.

“But what I know is that admarc has maize and will continue to have maize to distribute across the country and most importantly, we have so much maize in the country that vendors and the private sector are keeping, enough to feed the whole nation, so I am not worried.”

Part of the maize with the said private traders is the same one drained out of Admarc to feed that scheme, sources said.

We asked Admarc General Manager, Dan Makata, to explain the deals on account of reports that it is a racket which politically-connected and profiteering enterprise use.

He said the maize was for commercial purpose and Admarc sold it as business.

But, in rather a thinly-veiled way, he did indicate there could be something shady in the transactions.

“The transactions took place before I joined Admarc. I wouldn’t know what really happened but I’m informed that those were normal transactions and the maize was fetching that price [of K205 per kilogramme] because it was cheaper that time,” Makata said.

Then he added: “We are looking at the issues to learn from the previous mistakes and to make sure that no further mistakes are made in future.”

On August 11 2023, Kawale told Parliament that government has started restocking Admarc depots to beat the vendors who are selling the grain at a higher price ranging between K40,000 to K50,000 per bag in some areas.

“Vendors are taking advantage of the situation but we want to stabilise the prices by making sure that our strategic grain reserves are restocked.

“The vendors think if the prices will still be up, then government would be forced to buy from them but government has got the liberty to buy maize either locally or internationally. Our goal is to make sure the consumer is protected,” he said.

Chairperson for Agriculture Committee of Parliament Sameer Suleman expressed disappointment that Malangalanga and Chilambula warehouses which were fully stocked last year are cleared out of the grain into markets other than Admarc’s.

“This [that there is no maize] raises more questions. We had a lot of maize here last year. Where has that maize gone? We want an explanation.

“Skeleton staff and no maize. I feel this is a deliberate move to make the country go dry. We had maize, they sold it,” Suleman said.

According to Makata, Admarc has only about 12,600 metric tons which it is drawing from the National Food Reserve Agency (NFRA).

That is the maize it is selling to Malawians currently.

“We do not have maize as Admarc because we were never given money to buy maize. The maize we are selling now is being drawn from NFRA.

“If you ask me about that tonnage being enough, I would say it is not enough to reach out to those in need of maize but the maize will be supplied in phases. There will be another phase,” Makata said.