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Farmers’ associations: unleashing innovation and an entrepreneurial spirit

©IFAD/Marco Salustro

Mafupa village_ Tiesenao group members receive chickens from SAAP project.

In the Lilongwe district of Malawi, a farmers’ association has made a significant difference in the lives of the local community by providing training and enabling its members to negotiate higher prices for their crops. With his extra income, one smallholder farmer has improved his family’s situation by investing in solar power as a creative way to generate even more additional revenue.

Laying the groundwork for increasing incomes

The Tithandizawe Smallholder Farmers’ Association (TSFA) was formed in 2008 in Chakhunta village in the Lilongwe district, following the implementation of the Irrigation, Rural Livelihood and Agricultural Development Programme (IRLADP), a US$52 million programme co-financed by IFAD and the World Bank. TSFA was established with the aim of providing food security and received MK 2 million (US$13,245) for training and support in group management, farming, marketing and business.

TSFA used some of the funds to build a warehouse, a shop to sell agricultural inputs and a small office equipped with a computer. A farmers’ business school also was established to train farmers to calculate and analyse business margins, keep records of crops and prices for each season and set profitable prices. The farmers were also taught improved farming methods such as how to use better seeds and fertilizers at the right time.

The farmers in the association were able to negotiate higher prices for selling their crops as a group. While they initially received fertilizer as start-up support to help them improve crop production, this year Jeckitala Pitala, a smallholder farmer, was able to buy the bags of fertilizer for the next season with his own income. “I store them in my house, because I’m worried they might get stolen,” he explained. For this reason, he also stores his tobacco crop inside.

Investing in solar power

Jeckitala, a 49-year-old father of five, grows maize, tobacco, groundnut, soya and vegetables for his own consumption and for sale. He was struggling to produce enough food to feed his family until he joined TSFA. With the extra income he was able to earn from his crops after joining the association, Jeckitala invested in a solar panel and a cell phone charger. His idea wasn’t to power his own house, at least not immediately, but to use his solar panel to re-charge other villagers’ phones for a fee. He doesn’t even own a cell phone himself; his charger is only for business.

“I bought the solar panel for MK 15,000 [US$99]. I make MK 500 [US$3.3] per day with it, and so far I’m getting business every day, except when it’s not sunny,” he said. Jeckitala has owned his solar panel for less than a year, and he believes that he’ll be able to use it in his region for about nine out of twelve months, generating extra revenue of up to MK 135,000 (US$894) and increasing his total income by 50 per cent. Last year, his farming activities earned him MK 250,000 (US$ 1,655). His total income from farming and selling power is about US$7 per day.

Even before investing in solar power, Jeckitala had been able to build a new brick house with a corrugated iron roof, a sign of improved living conditions in rural Malawi. He also now owns an oxcart for transport, which he occasionally rents out, and has livestock. “I have 15 pigs, 3 donkeys, 15 chickens, 20 guinea pigs and 10 goats,” he said. “Before the association, I was very poor.” He also has his own bank account at a local bank that is 6 kilometres from his village. His immediate ambition is to be able to open a bank account for each of his children. “If I can’t, I’ll open one account for the girls and one for the boys so they have a bit of money aside,” he said.

Improving lives with an eye toward the future

By the end of 2009, TSFA counted 262 members, including 173 men and 89 women. During the 2008/09 season, the members of the association sold 19 tons of soya beans for MK 85/kg (US$0.56) By the end of 2010, they had produced 17 tons, and the prices were much lower at MK 50/kg, because of the bad weather. They also produced 27 tons of unshelled groundnuts during the 2007/08 season, and 50 tons for the 2008/09 season. The members retain the maize they produce for their own consumption.

Half of the TSFA members have been able to build a corrugated-iron roof and brick house, and most of them have bought a bicycle, the favoured mode of transport in the area. Some of them have bought cell phones and radios, and more are able to send their children to primary school. Jeckitala, who went to school until he was about 8 years old, sends his four younger children to school, while his older son, who is also a farmer and already a father himself, lives in Jeckitala’s old house next door. “We have no food shortages, we have bicycles and we are well-dressed, so our situation is definitely improving,” said the TSFA members.

To prevent future food shortages, the association started a village food bank to provide food until the next harvesting season. Before that, the village had recurrent food shortages from January to April. Farmers are able to borrow bags of maize from the food bank and repay the loans with 10 per cent more maize during the following season, enabling the food bank to grow.

In the near future, the association hopes to invest in an oil press to process soya and groundnut into oil, allowing its members to sell their commodities at a higher price by adding value to them. The other priority for the group is to start an adult literacy programme.