By Bester Kayaye
Minister of Agriculture Lobin Lowe says he is impressed with how the multimillion dollar Agricultural Commercialization Project (AGCOM) is fairing in commercializing local daily farming in the country.
The Minister made the remarks on Wednesday when he toured Thyolo district to appreciate dairy farming activities being carried out by Mangunda Milk Bulking Group.
Lowe expressed excitement at the knowledge and skills the famers had on how to sustainably run daily farming.
“Am really impressed with how the project is fairing in terms of the economic empowerment of farmers, especially women,” he said noting that the design of the program was to attain production sustainability through animal cross breeding and the provision access to markets through the producer and off-taker arrangement.”
But the minister admitted that the existing 3% withholding tax and pricing constraints suffocate farmer’s business growth. He then promised that his ministry will consult widely to address the two issues.
On the withholding tax, he indicated the need to revise the 3% tax deduction arrangement since government expanded the tax band of withholding tax to be subjected to income of over K100-thousand.
According to a snap survey conducted around local retail outlets by the Milk Bulking group, milk farmers yield less when compared to the profits made by an off-taker. It was revealed that an off-taker sells a litre at K1,200 yet he purchases the same milk at Mk210 per litre.
Lowe asked the group to put its house in order as it looks in the possibility of facilitating the acquisition of milk processing unit so that the farmers can reap meaningful returns from their labour.
He added that ministry, through the department of Animal Health and Livestock Development, is currently in the process of analyzing a piece of legislation that will facilitate establishment of a Milk and Milk-Product Board, which will, among others, negotiate prices on behalf of the local farmers.
In his remarks, AGCOM National Coordinator Dr. Teddie Nakhumwa said the project’s development objective is to increase commercialization and competitiveness of agricultural value chain products in crops, livestock and fisheries.
He said it intends to rectify fiscal constraints encountered by small and medium scale farmers such as poor access to organized markets, poorly organized farmers and farmer groups, poor access to competitively priced finance and poor market infrastructure.
“The project provides 70% matching grants for the purchase of capital equipment and also insures that farmers lend from commercial banks to finance operations by guaranteeing 70% of their loans,” he said adding that the project also provides public infrastructure through connecting producer organisations to power, irrigation and road infrastructure—in what is known as Last Mile Infrastructure.
The project only supports producer groups that have formal arrangements with off-takers to promote a business culture among small and medium scale milk farmers.
And one of the project beneficiaries Elizabeth Mwalama, a 51 years old widow based in Chimwanga village T/A Naseta in Thyolo district hailed the project for helping in transforming people’s economic statuses.
“My life has been transformed through this project. Initially, I had no capacity to support my five children, but with the daily farming that was introduced to us through our milk bulking group, I can now afford a smile knowing my financial struggles are over” said Mwalama.
AGCOM has so far approved 45 PAs, out of which, 25 have already paid the required 30 percent contribution and are already accessing funds from AGCOM for implementation of the sub-projects. Over 400 hectares of land for local and foreign investments have been identified to secure an enabling business environment for PAs.