The coming of anti-smoking lobbies worldwide brought about uncertainties of tobacco marketing in Malawi. NASFAM members were not spared as such members were requested to diversify their crop production towards other cash crops. In principal as in tobacco where members sell their yields on the organized market (Auction Holdings) members were equally expected to consolidate their yields in anticipation for the market however the government policy and the marketing dynamics of crops other than tobacco in Malawi prompted NASFAM to allow Crop Marketing Unit to buy and sell members produce and where possible to value add. It is anticipated that the profit that would be realized from this activity will be injected into the NASFAM programs.
Todate the unit plays a big role in consolidating members produce, bulking and/or branding and distribution of the same to various markets.
1. Crop Procurement
NASFAM Commercial buys members produce through NASFAM Association Management Centers (AMCs). NASFAM Commercial together with the AMC Board of Directors and Management discuss the farm gate prices based on the members Cost of Production and ruling market prices.
Procurement of members produce is either conducted by Commercial Agents or Association own buying.
NASFAM Commercial borrows money from the banks to finance the program. Where Agent is used, NASFAM Commercial pays for the produce against delivery to the designated warehouse whilst for the Association own buying funds are advanced to the AMCs at no interest. As the procurement is an ongoing process, AMC is asked to reconcile the trance being used when at least 70% has been put to a proper use. The next trance is advanced to the AMC when NASFAM Commercial management is satisfied with the reconciliation for the previous trance.
It should be noted that if an Association is got its own capital, they can buy members produce in their area and sell the same to NASFAM Commercial at an agreed price depending on the prevailing prices.
2. Crop Marketing
NASFAM Commercial sells the members produce to various markets: domestic, regional and international.
On domestic market we offer bulk stocks and branded products: Bulk stocks are usually farmer stocks and are sold to processors. Branded products are those that have been value added from the members produce and are sold to various super markets through the use of NASFAM distribution van.
On regional markets we offer bulk stocks that have been graded through either the use of manual labor or machine sorting. These stocks are graded in order to match the various market specifications.
Same as on international markets we also offer bulk stocks that have been graded through either the use of manual labor or machine sorting. These stocks are also graded in order to match the various market specifications.
3. Value addition and products branding
NASFAM Commercial explores various value additions to the members produce in order to enter into the high value markets. The exploration of such value additions depends on various reasons ranging from the availability of sufficient raw materials, skilled personnel and capital for investment.
NASFAM branded products are sold through the super markets and NASFAM three shops in Blantyre, Lilongwe and Mzuzu. Current products are; NASFAM Kilombero Rice, NASFAM Kilombero Gold, Farma Nuts, NASFAM Roasted Nuts, NASFAM Nyama Soya, NASFAM Groundnuts Seed and NASFAM Beans.
Those AMCs that are running their shops profitably can as well buy and sell some of NASFAM branded products.
4. Bulk Selling
NASFAM Commercial time to time responds to tender invitations for the supply of various materials ranging from plant materials and food stuffs. Plant materials like cassava cuttings, Sweet potato vines and legume seeds have been supplied in the past to various development partners. On the other hand products like Maize flour, Maize and beans have been supplied to various relief organizations.
NASFAM Commercial sources fertilizer and supplies to various farmer associations and organizations through a tripartite arrangement with banks. Fertilizer is also sold to various groups through Employers Guaranteed Loan facilities.