World Food Program in Malawi is helping small farmers gain bargaining power in market
"WFP Malawi purchases almost 70 percent of its food locally. Since the inception of P4P (Purchase for Progress) in 2009, WFP has purchased almost 52,000 metric tons of commodities through ACE or directly from farmers' groups, putting an extra US$ 14 million directly into the pockets of the smallholder farmers and into the local economy. The food is used in WFP programmes in Malawi and neighbouring countries for activities such as school meals, food for assets, refugee rations and maternal child health programmes. Purchases from farmers' organizations continue to increase as more FOs meet WFP's quality standards, minimal contract sizes and strict delivery requirements.
Applying knowledge from P4P training to other markets During the visit, I met the members of Cheka FO in Ntchisi district. The FO had recently received a ‘Certificate of Graduation' as a result of their good performance in marketing to WFP and others. This means that they have graduated from a ‘direct purchase' modality (a negotiated contract), to a competitive procurement modality through the internet-based trading platform of ACE.
Matthews Kamphambe, the chairman of Cheka FO, told me that last year the FO sold maize to a large agro-dealer as well as to WFP.
"We got a good price, as we sold later in the season," he said.
He attributes this success to the training and experience he and his colleagues got over the past three years.
Cheka is now applying their improved knowledge of warehouse management and marketing to the other products that they aggregate.
"We offer our members the possibility of getting paid when they bring their commodities to the warehouse - or to wait to get paid a better price when we find a market," explained Matthews. Last season we didn't have any farmers asking for upfront payment because they now believe that it's better when we all sell together. And we always encourage our members to keep enough for their families before deciding to sell."
World Food Programme, "Progress With Smallholder Farmers Is Real But Challenges Remain In Malawi," Aug. 9, 2013. Accessed on April 15, 2014. http://www.trust.org/item/20130809120618-loxhz/?source=hppartner
[verified 4/15/14]