Africa-Press – Malawi. Malawi’s tobacco industry reached a record-breaking milestone in 2024, generating over $545 million in export earnings—up from $389 million in 2023. Tobacco continues to dominate, contributing 57% of the country’s total export revenue. While this may appear promising on the surface, the country’s overreliance on the crop is unsustainable and risky.
Global trends show a shift away from traditional tobacco. Forecasts indicate that tobacco production will decline from 6.4 million metric tons in 2023 to 6.3 million by 2028. The industry is only maintaining marginal growth by pivoting to Reduced-Risk Products (RRPs) such as e-cigarettes and heated tobacco—sectors in which Malawi has no stake.
Furthermore, recent trade data shows volatility in Malawi’s tobacco exports. According to merchandise trade data from the Malawi National Statistical Office (NSO), in early 2025, exports dropped sharply from $45.2 million in January to $11.3 million in February, further highlighting the crop’s instability as a long-term forex earner.
Against this background, it is worth noting that the 2025 tobacco marketing season opened amid farmer protests over low prices, with offers ranging between $1.20 and $1.80 per kilogram, despite rising input costs. Some farmers expressed that the prices do not match with the increasing costs of inputs like fertilizer, which can cost up to K140,000 per 50-kilogram bag. These frustrations led to a temporary suspension of sales at the Kanengo auction floors.
Given these realities, there is an urgent need to review Malawi’s National Export Strategy II (NES: 2021 -2026). The strategy must move beyond tobacco and prioritise short-term value crops like soya and legumes, especially during winter cropping seasons. These crops are increasingly in demand both regionally and globally, and offer a more sustainable pathway for smallholder farmers.
The business community must lead this diversification effort by investing in these alternative crops, supporting outgrower schemes – also known as contract farming, and ensuring fair market access. Government and stakeholders should align export priorities with actual market potential—not legacy crops.
While Malawi is beginning to export high-value crops such as macadamia nuts, the economic benefits are not fully realised domestically. A significant proportion of producers are registered offshore, raising concerns about how much foreign exchange is actually retained in Malawi. There must be a concerted effort to empower indigenous producers and ensure greater local participation and ownership in the value chain.
To create jobs, Malawi must move from being an exporter of raw goods to a producer of value-added products. Manufacturing locally—whether in agro-processing, food packaging, or natural cosmetics—can significantly increase employment and forex retention.
The Buy Malawi Initiative needs stronger buy-in from the private sector. Supporting this campaign is not only patriotic—it’s economically strategic. Local production reduces import dependency, stimulates local enterprise, and reinforces consumer confidence in Malawian goods.
In conclusion, tobacco may have brought Malawi this far, but it will not take it further. The time to diversify is now. A renewed National Export Strategy, driven by local industry and focused on high-value, short-term, and quality crops, is critical for building a resilient and inclusive Malawian economy.
By: Hannington Gondwe, CEO, UK-Malawi Chamber of Commerce (UKMCC)
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