How Traceability is Restructuring Malawi's Tobacco Industry

Moyer-Lee, Jason; Prowse, Martin

doi:10.1111/dpr.12096

Cited by 20 publications

(11 citation statements)

References 17 publications

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“…In addition, the leaf-buying firms provide contract farmers with extension services that require a stricter schedule to tend to the nursery as well as the process of harvesting, which according to focus group participants may result in less labour costs for nursery tasks. This finding supports one of the rationale supporting the implementation of IPS, namely to increase efficiency and compliance in tobacco production 20. The cost analysis contributes to the literature by disaggregating contract and independent farmers, as others have found that together smallholder farmers continue to face high production costs 32…”

Section: Discussionsupporting

confidence: 70%

“…Under significant pressure from leaf-buying firms and transnational tobacco corporations, the burley tobacco contract marketing was approved by the government and fully adopted in 2012 as the Integrated Production System (IPS). The majority of tobacco leaf produced in Malawi is now sold through contract farming 20. Many farmers have agreed to contractual arrangements because it is difficult to access other bank and government credit facilities 20.…”

Section: Introductionmentioning

confidence: 99%

“…The majority of tobacco leaf produced in Malawi is now sold through contract farming 20. Many farmers have agreed to contractual arrangements because it is difficult to access other bank and government credit facilities 20. Finally, tobacco farmers are assured a market (contracting leaf company) for their tobacco leaf at the end of the growing season, though the pricing is not specified in the contract.…”

Section: Introductionmentioning

confidence: 99%

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Costs, revenues and profits: an economic analysis of smallholder tobacco farmer livelihoods in Malawi

Makoka¹,

Drope

Appau

et al. 2016

Tob Control

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Background The preservation of the economic livelihood of tobacco farmers is a common argument used to oppose tobacco control measures. However, little empirical evidence exists about these livelihoods. We seek to evaluate the economic livelihoods of individual tobacco farmers in Malawi, including how much money they earn from selling tobacco, and the costs they incur to produce the crop, including labour inputs. We also evaluate farmers’ decisions to contract directly with firms that buy their crops. Methods We designed and implemented an economic survey of 685 tobacco farmers, including both independent and contract farmers, across the six main tobacco-growing districts. We augmented the survey with focus group discussions with sub-sets of respondents from each region to refine our inquiries. Results Contract farmers cultivating tobacco in Malawi as their main economic livelihoods are typically operating at margins that place their households well below national poverty thresholds, while independent farmers are typically operating at a loss. Even when labour is excluded from the calculation of income less costs, farmers’ gross margins place most households in the bottom income decile of the overall population. Tobacco farmers appear to contract principally as a means to obtain credit, which is consistently reported to be difficult to obtain. Conclusions The tobacco industry narrative that tobacco farming is a lucrative economic endeavour for smallholder farmers is demonstrably inaccurate in the context of Malawi. From the perspective of these farmers, tobacco farming is an economically challenging livelihood for most.

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Section: Discussionsupporting

confidence: 70%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Costs, revenues and profits: an economic analysis of smallholder tobacco farmer livelihoods in Malawi

Makoka¹,

Drope

Appau

et al. 2016

Tob Control

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“…Ponte and Ewert (2009) suggest a more detailed understanding of upgrading possibilities in agro-food GVCs, including processes usually considered to be downgrading in the GVC literature, e.g., selling lower value products on a larger scale [20].) Several agri-food GVC studies discuss how lead firms facilitate or restrict the prospects for upgrading farms and companies in the Global South (e.g., [9,[21][22][23][24]). Upgrading potential and limitations for smallholders and agri-food processors as a result of more demanding food safety and quality standards imposed by northern retailers have been studied extensively in Kenya (see amongst others [9,[25][26][27]).…”

Section: Conceptualising Upgrading In Global Agricultural Value Chainsmentioning

confidence: 99%

Sustaining Upgrading in Agricultural Value Chains? State-Led Value Chain Interventions and Emerging Bifurcation of the South Indian Smallholder Tea Sector

Larsen

2016

Sustainability

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Abstract:The Global Value Chain (GVC) approach has emerged as a novel methodological device for analysing economic globalization and international trade. The suitability of the chain metaphor and strategies for moving up the ladder of GVCs ("upgrade") is widely echoed in international development agencies and public agencies in the Global South. Most of the existing GVC studies focus on new forms of firm-to-firm relationships and the role of lead firms and chain governance in defining upgrading opportunities. This paper examines the role of the state and local institutional initiatives in promoting upgrading in agricultural GVCs originating in rural areas of the Global South. The paper draws on research conducted in the South Indian smallholder tea sector. The paper argues that successful forms of state-led chain interventions not only contribute to upgrading of the smallholder-brought leaf factory strand of the GVC originating in the South Indian tea sector, but might also result in increasing bifurcation of smallholders integrated into high-margin markets through prominent bought leaf factories and a mass of "others" outside this tightly coordinated strand of the tea value chain.

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“…In Malawi, leaf merchants wish to aggressively expand contract farming due to pressure from cigarette manufacturers for full traceability, but as of July 2012 this has been resisted by government (for a full discussion, see Moyer‐Lee and Prowse ). At the national level, a complete shift to contract farming has repercussions for ancillary industries: fertilizer suppliers, transporters and commercial graders.…”

Section: The Burley Tobacco Segment In 2009/10mentioning

confidence: 99%

A Comparative Value Chain Analysis of Smallholder Burley Tobacco Production in Malawi – 2003/4 and 2009/10

Prowse

Moyer-Lee

2013

Journal of Agrarian Change

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Smallholders grow the majority of Malawi's main export crop – burley tobacco. We analyse this value chain segment for the 2003/4 and 2009/10 seasons. The comparison shows smallholder profits in 2003/4 were limited by two main factors: a cartel of leaf merchants at auction and inefficient marketing arrangements. In 2009/10, there was greater competition at auction, improvements in marketing, tighter state regulation (including minimum prices) and much more contract farming. The paper concludes by reflecting on aspects of the political economy of the tobacco industry at national and global levels.

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How Traceability is Restructuring Malawi's Tobacco Industry

Abstract: 5ACknowledgements 5

Cited by 20 publications

References 17 publications

Costs, revenues and profits: an economic analysis of smallholder tobacco farmer livelihoods in Malawi

Costs, revenues and profits: an economic analysis of smallholder tobacco farmer livelihoods in Malawi

Sustaining Upgrading in Agricultural Value Chains? State-Led Value Chain Interventions and Emerging Bifurcation of the South Indian Smallholder Tea Sector

A Comparative Value Chain Analysis of Smallholder Burley Tobacco Production in Malawi – 2003/4 and 2009/10

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