the two production estates at Nchalo and Dwangwa. This meant that Illovo practically accounted for all sugar milling and refining capacity in the country. Overall,
sugarcane output increased from about 170,000 tonnes in 1968, to over 2.9 million
tonnes in 2017 (FAOSTAT 2019). Even though the two large estates in Nchalo and
Dwangwa account for most sugarcane production, smallholder-based production has
been promoted in both areas through various policies and incentives put in place by
the national government (Chisinga et al. 2017). Furthermore, there has been continuous sugarcane ethanol production since the early 1980s, as a response to the energy
crises (Gasparatos et al. 2015) (Chap. 2 Vol. 1; Chap. 5 Vol. 2). Malawi has been
constantly blending high proportions of ethanol in gasoline, and is thus considered
one of the pioneer countries globally in the transition to alternative transport fuels
(Johnson and Silveira 2014).
Tobacco production seems to be overwhelmingly driven by national government
efforts to boost economic growth and rural development. As mentioned above,
tobacco is by far the main export in the country and is almost entirely produced
nowadays by smallholders. On the other hand, sugarcane production has been
mostly driven for economic growth. Even though Illovo undertakes most sugarcane
production, a relatively large number of irrigated and rain-fed smallholders have
been involved in the sector. Interestingly, despite sugarcane ethanol being blended in
high proportions with gasoline, energy security does not seem to have been a major
driver of sugarcane production. However, this might be gradually changing considering the current ongoing efforts to diversify ethanol feedstock production to boost
the national ethanol output.
Many national policies and initiatives have been put in place to assist industrial
crop production in Malawi. One of the first such regulations was the 1970 Tobacco
Act that regulated tobacco production (Wiggins et al. 2015). Since 1981 structural
adjustment programmes funded by the World Bank and the International Monetary
Fund (IMF) were implemented, precipitating many institutional and policy changes
in the agricultural sector in general, and food marketing in particular (Chilowa
and Chirwa 1997). The liberalization of marketing and production inputs was
implemented in 1990 under the Agriculture Sector Adjustment Credit initiative,
which allowed the entry of private traders (of varying sizes in terms of scale of
operations) in the marketing of farm inputs. Changes in the Special Crops Act of
1994 allowed for smallholder farmers participation in burley tobacco production,
which was formerly undertaken only by large-scale estates. The smallholder tobacco
sector benefited from the targeted Farm Input Subsidy Programme (FISP)
(2006–2010), which offered poor farmers access to seeds and fertilizers. Similarly,
the Malawi government has been supporting smallholder sugarcane growers with
loans and grants mainly through two outgrower management companies, namely the
Dwangwa Cane Growers Ltd. (DCGL) in Dwangwa and the Kasinthula Cane
Growers Ltd. in Nchalo (Chisanga and Zulu-Mbata 2017). The National Export
Strategy of 2012 was established to maintain the stable production of sugarcane for
sugar and ethanol production (Wiggins et al. 2015).
Apart from these policies there is a constellation of national policies and institutions that affect industrial crop production. Some of the most prominent include:
102
M. P. Jarzebski et al.
sugarcane output increased from about 170,000 tonnes in 1968, to over 2.9 million
tonnes in 2017 (FAOSTAT 2019). Even though the two large estates in Nchalo and
Dwangwa account for most sugarcane production, smallholder-based production has
been promoted in both areas through various policies and incentives put in place by
the national government (Chisinga et al. 2017). Furthermore, there has been continuous sugarcane ethanol production since the early 1980s, as a response to the energy
crises (Gasparatos et al. 2015) (Chap. 2 Vol. 1; Chap. 5 Vol. 2). Malawi has been
constantly blending high proportions of ethanol in gasoline, and is thus considered
one of the pioneer countries globally in the transition to alternative transport fuels
(Johnson and Silveira 2014).
Tobacco production seems to be overwhelmingly driven by national government
efforts to boost economic growth and rural development. As mentioned above,
tobacco is by far the main export in the country and is almost entirely produced
nowadays by smallholders. On the other hand, sugarcane production has been
mostly driven for economic growth. Even though Illovo undertakes most sugarcane
production, a relatively large number of irrigated and rain-fed smallholders have
been involved in the sector. Interestingly, despite sugarcane ethanol being blended in
high proportions with gasoline, energy security does not seem to have been a major
driver of sugarcane production. However, this might be gradually changing considering the current ongoing efforts to diversify ethanol feedstock production to boost
the national ethanol output.
Many national policies and initiatives have been put in place to assist industrial
crop production in Malawi. One of the first such regulations was the 1970 Tobacco
Act that regulated tobacco production (Wiggins et al. 2015). Since 1981 structural
adjustment programmes funded by the World Bank and the International Monetary
Fund (IMF) were implemented, precipitating many institutional and policy changes
in the agricultural sector in general, and food marketing in particular (Chilowa
and Chirwa 1997). The liberalization of marketing and production inputs was
implemented in 1990 under the Agriculture Sector Adjustment Credit initiative,
which allowed the entry of private traders (of varying sizes in terms of scale of
operations) in the marketing of farm inputs. Changes in the Special Crops Act of
1994 allowed for smallholder farmers participation in burley tobacco production,
which was formerly undertaken only by large-scale estates. The smallholder tobacco
sector benefited from the targeted Farm Input Subsidy Programme (FISP)
(2006–2010), which offered poor farmers access to seeds and fertilizers. Similarly,
the Malawi government has been supporting smallholder sugarcane growers with
loans and grants mainly through two outgrower management companies, namely the
Dwangwa Cane Growers Ltd. (DCGL) in Dwangwa and the Kasinthula Cane
Growers Ltd. in Nchalo (Chisanga and Zulu-Mbata 2017). The National Export
Strategy of 2012 was established to maintain the stable production of sugarcane for
sugar and ethanol production (Wiggins et al. 2015).
Apart from these policies there is a constellation of national policies and institutions that affect industrial crop production. Some of the most prominent include:
102
M. P. Jarzebski et al.