By Kingsley Jassi:
The Ministry of Industry and Trade has ordered 11 companies to halt recent price increases for fertiliser and animal feed, citing unfair trading practices amid growing concerns over market instability.
Minister of Trade Sosten Gwengwe and Agriculture Minister Sam Kawale, accompanied by Competition and Fair Trading Commission (CFTC) officials, visited Export Trading Group (ETG) and CP Feeds on Tuesday to enforce cease and desist orders.
Nine fertiliser companies and two feed manufacturers were served with interim orders under Section 23 of the Competition and Fair Trading Act.
CFTC indicates that the farm input companies that have been issued with interim orders include Export Trading Group (ETG), Farmers World, Malawi Fertiliser Company, Dalitso General Supplies, Paramount Holdings Limited, Optichem 2000 Limited, Rabs Processors Limited, Brussels Fertilizers Limited and Agora Limited.
The poultry feed companies that have been issued with interim orders include CP Feeds and Proto Feeds.
At ETG, Gwengwe questioned the company’s decision to raise fertiliser prices based on current market conditions when their last imports were made in December last year under different circumstances.
The minister also warned against hoarding products, saying it would lead to prosecution.
ETG Marketing Manager Felix Kazambala said the company would comply with the orders while preparing a detailed response to the concerns raised.
During a visit to CP Feeds, Gwengwe expressed concern over the company’s recent price adjustments, noting they had implemented three increases within a short time.
“CP Feeds is a dominant player in the poultry industry and we don’t want them to abuse their dominance. Their price increases have been driving up costs of chickens and eggs,” Gwengwe said.
CP Feeds Head of Sales and Marketing Chimwemwe Mganga cited challenging operating conditions but indicated that the company would provide a formal response to the concerns.
The ministerial intervention follows public outcry over announced fertiliser price increases from K105,000 to K138,000 for basel type.
This adjustment came shortly after prices had already risen from K75,000 at the start of the growing season.
Both companies attributed the price hikes to deteriorating trading conditions, with investigations revealing some firms were basing their pricing on black market exchange rates despite stability in official rates.
In a WhatsApp response, Fertiliser Association of Malawi Executive Administration Officer Hannah Mankhambera said the development was strange.
“We cannot comment now as fertiliser importation and Trading was liberalised long time ago as early as 1995, where every trader sets his own prices. Previously, government was setting maximum retail prices (MRP) but this stopped when liberalisation of fertiliser importation and trading was effected by the government. We believe that CFTC are in a better position to explain about this,” Mankhambera said.
