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February 09, 2012

Not all sector players happy as Malawi, fearing shortages, bans maize exports

Malawi has banned the export of maize and maize-based products until further notice. The December 28 2011 ban has been spurred by fears of a shortage of the country’s staple crop over fears of a much reduced harvest in the current crop season, because of late and erratic rains.

A maize shortage would be a dramatic change from the last several years of an annual maize surplus, based on the combination of good rain and an agricultural inputs subsidy programme for the country’s farmers.

A maize shortage would have the political fall out of people asking why more attempts were not made to build up a maize reserve in the years of bumper harvests. Neighboring Zambia, also enjoying recent good maize harvests and also fearing shortages this year because of poor rain, has justified the levels of its exports partly on the basis of limited storage facilities.

In the event of a shortage of the region’s main staple food, no one is likely to listen sympathetically to such excuse after several good harvests. Ordinary people may not care much about how much surplus maize is exported, with many even seeing that as a country proudly serving a regional ‘breadbasket’ function. All this will be forgotten in the recriminations that would accompany shortages, high prices and imports of maize.

Malawi president President Bingu wa Mutharika, the architect of the subsidy programme and also occupying the agriculture portfolio, has warned against the ‘careless’ selling of maize, urging farmers to hold on to their stocks until the current season’s prospects become clear.

Maize in Malawi is typically planted in October/November with the onset of the rains, with harvest in April/May. Many farmers who planted on the early rains had to replant in December/January when their maize plants died. Delayed planting will inevitably reduce yields.

Maize prices have already begun to shoot up in Malawi in anticipation of shortages, reportedly by up to 50% in some cases. Farmers who happily sold their maize during good harvests are now finding that they have to pay two or three times as much, with the next harvest still two months away and expected to be poor.

Not all sector players are in favor of the ban. Intra-regional maize growing inequalities mean that there is always a sure market for this key staple. Farmers and traders who target the lucrative regional market are, unsurprisingly, not happy about the export ban. Traders could take advantage of the low maize purchase prices when there is a glut, and make a good profit from exporting at much higher prices to countries experiencing maize shortage.

While the government must necessarily prioritize maize food security, Farmers Union of Malawi President Felix Jumbe argued against the ban on the grounds of lost foreign currency earnings for the country. The government, also wanting foreign currency proceeds at a time of generally poor economic performance compounded by the withdrawal of the support of some international donors, has been anxious to assure traders that the ban is temporary pending clear results on the size of this year’s maize harvest.

African Agriculture

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