longitudinal impact assessment study of sugar producers in malawi

8. Impact areas
8.1 Changes in social structure
There has been a radical change in social structure due to the change of Kasinthula
farmers from mainly rainfed subsistence farming with some cotton to an irrigated
cash crop (initially rice). This change occurred when the rice scheme was started
and was not attributable to Fairtrade. This change led to some families being
allocated land 6 in the scheme and others not (some farmers were suspicious of the
scheme and decided not to be part of it). This difference has been exacerbated with
the change to sugar, and the economic benefits that sugar has brought to KCGL
members. Since 2004, with Fairtrade certification, the 40% of Fairtrade Premium that
is allocated (in kind) to KCGL members has further accentuated the differences
between those in the company and those who are still subsistence farmers.
The Fairtrade Premium goes some way to redressing the balance between members
and non-members through the community development initiatives, such as water,
health and environmental projects. The Case Studies of households that are in KCGL
and those that are not members of the company demonstrate these differences (see
Section 8.3).
8.2 Changes in the socio-economic situation of participating producers and
their households including their income, working conditions, living conditions
and access to basic services
The income of participating producer households is a comparatively good one,
especially for those families in good health who can cope with the majority of the
labour requirements (see Case Studies in Section 8.3). The table below shows the
monthly income from Illovo. This is the gross advance from which deductions can be
made for labour, inputs etc.
Table 8.1 Monthly advances to KCGL producers
Year Monthly advance from Illovo
1998 MK800 ($5.7)
1999 MK1000 ($7.1)
2000 MK3000 ($21.4)
2001 MK3000 ($21.4)
2002 MK5000 ($35.7)
2003 MK6000 ($42.9)
2004 MK7000 ($50)
2005 MK8000 ($57.1)
2006 MK9000 ($64.2)
2007 MK10,000 ($71.4)
2008 MK11,000 ($78.6)
2009 MK12,000 ($85.7)
The income (technically an advance) is stable over the year and reliable. Income has
risen in most years due to farmers complaints that they need more to live on. This
increase in advances has meant that the KCGL overdraft continues to rise. There is a
25 year contract between Kasinthula and Illovo providing the stability that is
necessary for sugar cane, which is a long-term crop.
6 Ownership of the land remains with the Chiefs. Members may not sell the land, but can pass
it on to the next generation of their family
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