THE ECONOMICS OF MAIZE PRODUCTION
By Alexander Nkosi
The economics surrounding maize production is interesting. Our farmers are hooked to maize production, it is more of a cultural thing. The challenge is that it being a staple crop, they do not only produce it for consumption but also for sale. Government is already subsidising production through FISP, if FRA sets the floor price at K250 per 50kg bag, most farmers will turn to FRA and not private buyers, this will push prices up and the high prices will be passed on to consumers. Government will also have to source funds to buy at high prices. The quantity that can be exported is also limited and usually Government to Government deals tend to be cheaper.
With the high cost of inputs, the expectation is that the price of maize should be high for farmers to make profit and expand production, but the challenge is that this then means prices of products like maize meal and animal feed will also go up. High prices animal of feed translate into high prices of poultry, diary and livestock products. These being key components of the diet of an average Zambia, means that the cost of living also goes up. So then how do we please both farmers and consumers? The secret lies in significantly lowering the cost of production and investing in improving productivity.
It is also high time we stepped up promoting cash crops like tea and tobacco. Malawi’s major exports are tea and tobacco. 1kg of tobacco is fetching USD2 (an equivalent of K34 in Zambia). I’m not sure how high the cost of production is but we really need to promote cash crops along with maize and other alternatives.
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