ICRISAT Archival Report 2006 - The seedlings of success in the ...

Objectives: Identify production and marketing constraints of groundnut farmers along the lakeshore of Malawi
Explore options for linking groundnut farmers to product markets for more sustained adoption and improved
incomes.
Methodology: Ninety smallholder groundnut farmers were interviewed along the lakeshore in Malawi with a
view to understand the production constraints and how these are linked to marketing. Marketing challenges
facing groundnut farmers were also investigated. This was followed immediately with a traders’ survey. About
30 traders of different commodities were tracked for about one month in the peak of groundnut marketing
season. It was necessary to deal with traders of all types of commodities –and not only for groundnuts because
the latter hardly exist. The interest was to assess the different marketing functions from the farm gate to the
trader to the processor or exporter and evaluate the pricing and quality control dynamics including price
determination at different levels. An investigation of the policies, rules and regulations affecting the groundnut
trade was also carried out to determine the extent to which they are facilitating or constraining the viability of
the groundnut sub-sector.
The role of the private sector—wholesale buyers, processors and exporters was also investigated by visiting and
discussing with prominent firms in Lilongwe to establish their role in the marketing chains and to determine
areas and ways in which the two could be more amicably linked.
Preliminary Findings: Most of farmers maintained less than one hectare of groundnuts raised from improved
seed provided by ICRISAT. Yields are low averaging about 400kg of shelled groundnuts. There are generally
very poor marketing arrangements. Contract farming is unheard of in groundnuts although cotton contract
farmers can be found in the same groundnut growing communities. In fact if contracting for groundnuts is to be
initiated, there are lessons to obtain from cotton. Price formation is poor and farmers seem to be facing a big
price risk at marketing time. In the first place, a significant amount of groundnuts is sold on the farm before
harvest, mainly because of hunger. Farmers need money to buy food and other essential commodities before the
groundnuts mature. Obviously, given the circumstances, they would be willing to go for any price the buyer
declares because they are desperate at that time.
At normal harvesting time, farmers are invaded with a swarm of “buyers” or practically assemblers who have
been sent with cash from big traders and transporters or processors from the cities of Lilongwe and Blantyre as
well as from the border posts. Price negotiation is through the head men but the ceiling is already set by the
traders. It is envisaged that these prices are normally lower than what they could be under normal competitive
conditions. As a result the margins are likely to be quite big between farm gate and export prices even after
taking into account transport and transportation costs.
In effect, there is a wide gap between actual and potential conditions in the marketing conditions of groundnuts
and especially in price formation. The first steps are to facilitate, train and empower farmer groups at the village
level to enable them, in the first place to have the basis to negotiate for better prices as well as training them to
recognize that better quality groundnuts can also have a premium price from the processors.
A great potential exists to improve farmers’ incomes and food security from groundnuts in Malawi and there is
need to continue with this work in the future.
1C.7. Value chain analysis completed for pigeonpea and chickpea in Kenya and Tanzania
Pigeonpea sub-sector study in Kenya
This study was summarized and synthesizes several fragmented studies on pigeonpea in Kenya. It targeted to
identified the constraints that limit full exploitation of the potential of pigeon peas for dryland agriculture. The
methodology adopted was that of a sub-sector approach to examine several actors from the pre-production to the
marketing and utilization chain. The result is expected to be the source book for the pigeon pea sub-sector in
Kenya and facilitate similar synthesis of the legumes sub-sectors at the regional level. Development partners
like TechnoServe and Catholic Relief Services have already started using these findings for as part of their
ongoing efforts for improving legume productivity and market access in semi-arid regions.
This study has informed policy decisions on strategies for enhancing competitiveness of pigeon pea production
in East Africa in general and in Kenya in particular. It has identified strategies, constraints and opportunities for
for promoting high value pigeonpea varieties in Kenya and in the region. The findings of this study have
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