Background

Sugarcane Growers Association of Malawi (SUGAM) is an apex body of the small scale sugarcane growers in Malawi who grow sugarcane for industrial purposes. The association was established in 2014 as part of the outputs of the Capacity Building for Sugar Outgrowers project which was implemented by United Purpose (Formerly Concern Universal) from 2010 – 2017 with funding from European Union (EU) through National Authorizing Office (NAO) of the Government of Malawi and Solidaridad Network Southern Africa Trust. SUGAM is also registered with the government of Malawi under the Trustees Incorporation Act. The head office is currently in Dwangwa and is headed by The Executive Secretary. The organization has a board of trustees comprising 14 members which includes 10 growers and 4 affiliates.

Smallholder sugarcane production is Malawi is done using both irrigation and rain fed. The majority of the smallholder farmers who have irrigated fields received their support through irrigation development projects under Dwangwa Cane Growers Trust, Shire Valley Cane Growers Trust and Phata Sugarcane Outgrowers Cooperative. All smallholder farmers in Nchalo practice irrigation farming. In most of irrigation schemes, the farmers play a very small part in the management of the schemes. Most of the tasks is done by the management company who are paid a management fee for their services.

The other smallholder farmers produce their cane under rain fed conditions. These farmers farm in their customary land and the farmers are involved in decision making at all the stages of production with support from the associations where they are members. Rain fed sugarcane production is mainly done in Dwangwa area in Nkhotakota.

Sugarcane production in Malawi dates back to the 1960s when the Lonrho-owned Sugar Corporation of Malawi (SUCOMA) began operations in the Shire Valley at Nchalo in Chikwawa. In 1978, a second estate, Dwangwa Sugar Corporation (DWASCO) was established with a majority government shareholding in Nkhotakota District. In the same year, an additional 698 ha at DWASCO was allocated to about 200 smallholder farmers under the Smallholder Sugar Authority (SSA), then a Government parastatal. The SSA provided the smallholder farmers with a variety of services which included loans for seed cane, fertilizer, cane cutting and haulage and training in sugarcane agronomy which assisted them in cultivating their plots. The sugarcane produced was collectively marketed through the SSA who deducted the loan given to the farmers. The combined area of both estates (SUCOMA and DWASCO) was gradually increased and in 1998/99, it stood at 16,800 ha with a combined annual cane production of 1.68 million metric tons.

Sugarcane has generally been considered by the Government of Malawi as a special crop because its cultivation requires special skills. With its acquired experience in sugarcane agronomy since 1978, government regarded the Small-holder Sugar Authority (SSA) as the appropriate agency to carry out development of sugarcane production, including provision of extension services and input loans to farmers, by optimally utilizing scarce resources for increased production and productivity of sugarcane by smallholder (including women) farmers. Furthermore, SSA acquired specialized skills in group dynamics and organization, small-holder loan administration, irrigation engineering, and equipment (farm machinery, transportation equipment) management.

In its drive to foster broad based economic development and private sector involvement in the sector, the Government Malawi privatized the SSA. In a farmer/staff/management buy-out, the farmers, staff and management of the former SSA acquired the technical arm of the SSA which became the Dwangwa Cane Growers Limited (DCGL). With its experience in the sugarcane production industry, DCGL continues to provide advisory, management and marketing services to both the old and new sugarcane farmers. In order to consolidate the gains of the former SSA, the Government created the Dwangwa Cane Growers Trust and gave it the mandate for providing subsector policies on sugarcane production and promoting the expansion of smallholder sugarcane production around Dwangwa. A similar Trust for the 1,544-ha Kasinthula Outgrower Scheme under Shire Valley Cane Growers Trust (SVCGT) that feeds the Nchalo Sugar Factory has been operational since 1997.

The smallholder farmers that were attached to DWASCO and SUCOMA were both using irrigated sugarcane production. The fields were specifically designed as estates.

Following the liberalization of the market, the privation of the SSA and the huge demand for cane to be crushed at Dwangwa and Nchalo mills for Illovo, and having experienced the economic benefits of smallholder sugarcane production, the in growers started to expand their fields to other privately owned customary land. Other farmers who did not have land in the estates also started growing their own cane with technical support from DCGL.