8 February 2017

Malawi: Farmers' Pride in Oil Processing Centre

Phalombe — It is a simple structure and its appearance is somehow deceiving. It looks like any other ordinary building. But it is not. This is a structure that is worth more than its modest appearance in terms of value.

And soon it will be transforming lives of many smallholder farmers and the general population in Phalombe and beyond.

Lying along the Jali-Phalombe Road, a few kilometres from Phalombe Boma, this building is home to the newly established Phalombe Sunflower Processing Centre. It houses an extraction machine that will be crushing tonnes and tonnes of sunflower into cooking oil.

It is not long ago that this building was inactive because of a general lack of funds to see it fully completed for agribusiness activities.

Constructed under the farm income diversification programme (FIDP) with funding from the European Union, the structure never realised its potential because FIDP phased out before its completion.

This resulted in eight years of dormancy until early last year when the National Smallholder Farmers' Association of Malawi (NASFAM) dangled a brilliant idea of resuscitating the building for income generating activities (IGAs).

"NASFAM head office informed us about a project called Malawi Enterprise Productivity Enhancement (MEPE) which aims at promoting products for small and medium enterprise (SMEs) or cooperatives," says Benson Kuziona, Innovation Productivity Centre (IPC) Manager responsible for Phalombe Sunflower Oil Processing.

He adds that NASFAM provided a loan of K6 million to buy sunflower in readiness for cooking oil production.

It is through MEPE, a project run by the Ministry of Industry, Trade and Tourism with support from European Union (EU) and the Common Market for Eastern and Southern Africa (COMESA), that the structure has been given a new lease of life and is now ready to become a vibrant factory.

With technical support and resources from MEPE, the processing centre will be equipped with oil extraction and refinery machines, a standby power generator, electricity connection and the extension of the building to include facilities like toilets and laboratory rooms.

Other spaces include a storage facility which is currently keeping 27 tonnes of raw sunflower as the initial bulk for oil extraction. There are also two rooms reserved for capacity building activities like trainings for farmers.

"MEPE has earmarked this facility as a centre of excellence where farmers from different districts can come and acquire knowledge and skills in agribusiness," says Kuziona.

The centre has been constructed to meet all the specifications required by the Malawi Bureau of Standards (MBS). In simple terms, it is a complete factory ready to shape the terrain of the oilseed processing industry in Malawi.

In terms of production capacity, Kuziona says the factory will require at least 600 tonnes of sunflower for processing per annum with a minimum of 2 tonnes crushed per day.

It is expected that members in the three farmers' associations of Phalombe, Mulanje and Thyolo will be at the forefront in producing enough sunflower to meet the demand and keep the factory running throughout. The associations have a combined membership of about 6000 smallholder farmers growing various crops.

Some of the farmers are already excited with the prospective benefits the factory will offer them. Many see it as a readily available and convenient market for their sunflower crop and they expect better prices.

"It is near us, we will bypass middle buyers and sell directly to the factory," says55-year-old Fredrick Phauphau from Muthumbwa Village in Traditional Authority (T/A) Mkhumba in Phalombe.

Phauphau, who is also vice chairperson for Phalombe Association, adds that carrying sunflower to far-away markets like Blantyre will be a thing of the past.

"Long distances are costly as they absorb between K10 and K15 as transportation cost per kilogram of the produce. This money will now go to the farmer," he says.

Apart from monetary benefits through good prices, the factory will also help in improving people's health in the district as they will be buying and consuming refined oil processed within their vicinity, according to another farmer Mary Popholo from Mankhanamba Village in T/A Kaduya in the same district.

"Most people here use cooking oil from Mozambique which has high levels of solidified fats. This is not good for our health.

"Sunflower oil is ideal because it has low levels of fats and we expect to get better oil from the factory," says Popholo, who is also vice secretary for Phalombe association.

The farmers also see the coming in of the factory as window for employment opportunities to some capable locals within the district.

But the prospect of a convenient market offering good prices is apparently the dominant expectation among farmers here.

While this could be the case, MEPE's project officer Nelson Nsiku believes that focusing on just selling sunflower crop and oil is not enough in making this agribusiness venture sustainable. He offers three insights.

Firstly, is that farmers should look beyond the selling of their crop to the factory at a higher price and consider value addition as a sustainable way of creating wealth throughout the year. Value created through processing can come back to their pockets through higher profits later in the year.

"Farmers need to know that there is no guarantee that the factory will always offer high prices because we have a liberalised market that determine prices for itself.

Free advice from Nsiku is that the processing centre should also consider making further investments in other processes like the selling of seed cake, which he says has a high return in the value addition chain of sunflower.

"Seed cake constitutes nearly 75 percent of the output when sunflower seed is crushed. There is high demand of cake from institutions and individuals engaged in livestock and poultry farming because it is the best feed for cattle, pigs and fish," Nsiku says.

Secondly, farmers need to make maximum use of NASFAM business model where a minimum number of employees are engaged to process while the association may consider graduating into a cooperative to enhance ownership.

Lastly, farmers should embrace the spirit of identifying themselves with their products in line with the Buy Malawi Strategy.

The strategy can best be translated into action through products that give their local communities some pride. As a nation, Malawi prides itself in Kilombero rice, Chambo fish and Mulanje cedar among others.

"The farmers should identify themselves with this sunflower oil. Whenever they go to other places and see their oil in various selling places, they should be proud to say 'this is a product from our village, district or association'. This pride is a great source of drive for sustainable production," says Nsiku.

The farmers are already proud of this oil processing centre and for this pride to live long, surely taking and making good use of the advice from the MEPE expert is the best way to go.

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