Traders ‘shun’ maize export
Malawi will only export 58,000 metric tonnes (mt) of maize—the country’s staple commodity—from the previous season, against the intended 500, 000mt.
This comes as only six companies have been given licences for maize export since the window was opened on December 1 2021. The window was closed on February 28 2022.
Ministry of Trade and Industry Public Relations Officer Mayeso Msokera confirmed on Monday that only few companies applied for licences.
Msokera added that most are intending to export to neighbouring countries of Mozambique and Tanzania, while a few target markets in Kenya and Zimbabwe.
He said findings of the ministry’s study suggest that supply of the commodity remains elevated in most of the targeted markets, a thing affecting prices.
“Most markets where we mostly export the produce to have enough maize in stock; therefore, the prices being offered are lower than those given during the previous season. Most exporters have resorted to selling the maize domestically, instead,” Msokera said.
However, Grain Traders and Processors Association—an umbrella body for private sector traders—said there is no enough stock of maize in the country, hence, most traders resorted to sell the commodity on the domestic market.
Grain Traders and Processors Association
Chairperson Grace Mijiga-Mhango said although demand has subdued this year, the government was cautious in issuing the licences amid speculation of looming hunger.
“Government was not sincere because when they opened the window, there was some doubt. They indicated that the process may smoothen after the first round crop estimate.
“But according to estimates, it seems the output will drop but there is no need to fear because they gave us 500,000mt and we have not even exported 20,000mt of that,” she said.
State-run grain trader, the Agricultural Development and Marketing Corporation (Admarc), has about 220mt of the commodity in stock according to its spokesperson Agness Chikoko-Ndovi.
In an interview Tuesday, Chikoko- Ndovi said Admarc was already granted a licence to export 40, 000mt of the staple grain to Kenya.
“We already have an export licence but it does not mean that, immediately, you start dispatching maize because there are procedures to exports commodities but, if we find another market, we might consider but now we are focusing on this one,” she said.
National Food Reserve Agency Board Chairperson Dennis Kalekeni on the other side said the reserve agency was sitting on a stock of 25,000mt of the commodity.
Maize price movement and availability have a bearing on the economy as they drive inflation given that it is weighed at 45.1 percent in the Consumer Price Index, a basket of computing inflation.
A situation report by Famine Early Warning Systems Network (Fewsnet) indicates that the upcoming harvest is expected to be 35 percent below average in the Southern Region.
This is an additional 10 percent lower than the initial estimation from the February Food Security Outlook.
According to the report, released on April 1 2022, this is due to the effects of tropical storms Ana and Gombe on top of underlying vulnerabilities and poor 2021 harvest in the region.
Earlier this year, a Malawi Vulnerability Assessment Committee (MVAC) report showed that more than one million Malawians will be food insecure.
Meanwhile this year, government expects maize output to drop by 14 percent to 3.9 million metric tons from last season’s 4.4 mt but President Lazarus Chakwera emphasised last week that this does not mean the country will be food insecure.
Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.
He is however flexible as he also writes about current affairs and national issues.