By The Forum

The Mega Farms input subsidy program benefited 952 farmers during the 2024/2025 growing season, Minister of Agriculture, Irrigation and Water Development Rosa Mbilizi told Parliament on Wednesday.

This marks a sharp increase from the 2023/2024 season, which had only 239 beneficiaries. During that period, farm inputs — including fertilizer, seed, and chemicals — were valued at MWK6.04 billion. In addition, four projects accessed medium-term capital equipment loans worth MWK3.18 billion for pottery, aquaculture, and irrigation.

Mbilizi said the total loan portfolio for 2023/2024, including interest, stood at MWK10.79 billion, of which MWK3.48 billion has been repaid.

“The outstanding balance of MWK7.27 billion highlights significant arrears within the program. The loans were due by December 31, 2024, with ADMARC and NFRA designated as off-takers of the produce,” she said.

For the 2024/2025 season, the 952 farmers accessed inputs worth MWK48.9 billion, despite the program having only MWK14.8 billion available.

The minister highlighted stark regional disparities among beneficiaries: 78% were from the central region, 16% from the north, and just 6% from the south.

Loan recovery remains a major concern. Only 11% of beneficiaries fully repaid their loans, while 16% made partial payments totaling MWK3.9 billion.

“The majority — 688 farmers, representing 72% — have not made any repayment at all,” Mbilizi said. “For the 2025 season, maize sales have generated MWK10.5 billion in repayments, translating to an overall collection rate of just 19%.”

Out of an expected 88,000 metric tonnes of maize for the 2024/2025 season, only 8,318 metric tonnes were delivered to ADMARC, NFRA, and the Agricultural Commodity Exchange (ACE).

According to the minister, much of the maize was sold to vendors or withheld by farmers anticipating higher prices during the lean season. She added that some beneficiaries, particularly vendors, diverted subsidized fertilizer for resale on the open market.

Total expenditure for the two growing seasons has reached MWK55.5 billion, excluding accrued interest.

Mbilizi attributed the poor loan recovery to several factors, including underfunding of ADMARC and NFRA, politicized issuance of redemption certificates, weak loan vetting processes, lack of collateral, and the inclusion of vendors who abused the system.

To address the situation, the ministry is working with the Malawi Agricultural and Industrial Investment Corporation (MAIC) to strengthen recovery efforts. Measures include issuing 14-day demand notices (effective January 29, 2026), engaging debt collectors, reporting defaulters to the Credit Reference Bureau, and pursuing legal action through the Attorney General.

A forensic audit has also been initiated to uncover fraud and embezzlement, with files on defaulters already submitted for legal action.

Meanwhile, the government has suspended support to mega farms for the 2025/2026 season pending the audit and program review.

The ministry is collaborating with institutions such as Salima Sugar Company, Greenbelt Authority, Lilongwe University of Agriculture and Natural Resources, the Malawi Defence Force, Malawi Prison Service, and Illovo Sugar Company to boost production. Together, they have cultivated 2,216 hectares, with an expected yield of 8,864 metric tonnes of maize.

Looking ahead, Mbilizi said reforms will focus on improving productivity and commercialization, including reducing seed costs through local production.

The government also plans to establish two model industrial farms spanning a combined 25,000 hectares: 16,000 hectares for food crops and 9,000 hectares for high-value plantation crops.

“Government remains committed to reforming the Mega Farms program to ensure it delivers the intended results,” she said.

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