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close this book Application of biomass-energy technologies
close this folder II. Improved charcoal production
View the document A. Introduction
View the document B. The Malawi Charcoal Project
View the document C. Charcoal markets
View the document D. Constraints
View the document E. Policy environment and role of the Government
View the document F. Role of entrepreneurs and informal-sector artisans
View the document G. Local research initiatives and indigenous technical skills
View the document H. Role of non-governmental organizations
View the document I. Role of end-users
View the document J. External financial support and local credit and banking institutions

C. Charcoal markets

The project initially targeted potential industrial markets because a review of existing industrial fuel consumption had shown a substantial use of coal and diesel oil: 25 large-scale users of fuel consuming 39,900 tons of coal and 473 tons of diesel oil per year (IPC, 1988). Coal could be substituted by charcoal and combustion trials were undertaken at Portland Cement Limited, the country's sole manufacturer of cement. Findings of the tests indicated that a blend of 83 per cent coal and 17 per cent charcoal could be realized without incurring any significant operational problems. With the planned expansion of the cement factory, use of charcoal was expected to reach 10,000 tons per year but, to date, the expansion of the factory has not taken place.

Other industries that used coal were interested in converting their boilers to charcoal and steam boilers alone could use about 13,000 tons of charcoal per year. This potentially large market did not materialize as quickly as expected because of the necessity of costly modifications to existing installations required for optimum use of charcoal. The estimated cost of modifications ranged from $US3000 to $5000 and many of the industrial consumers were not willing to incur the added cost.

The tobacco agricultural which, in 1986, accounted for over half of Malawi's export earnings, appeared to be an attractive marketing outlet for the Viphya charcoal. The total fuelwood consumption for curing of tobacco was estimated to be about 300,000 tons in 1986. About 40 per cent of the required fuelwood was derived from existing plantations, and the tobacco farming community was finding it increasingly difficult to procure the balance of its fuelwood requirements.

The project therefore, undertook several field tests to assess the suitability of softwood charcoal from the Viphya forest plantation. Field tests were undertaken in the 1988/89 curing season and involved the processing of 275 barn loads. The average specific fuel consumption was 2.91 kg of charcoal per kg of processed tobacco. The field tests also demonstrated that the implementation of several modifications and improvements could reduce specific fuel consumption by 60 per cent. Most of the improvements were aimed at ensuring more stable combustion conditions and more effective control of secondary air.

The field tests revealed several interesting findings. First, the introduction of a fan realized smaller savings than was originally expected. Secondly, the field test showed that the use of charcoal improved the quality of the final tobacco produced. This is largely due to the fact that control and monitoring of charcoal combustion is easier than controlling wood combustion which is a less homogeneous fuel. Poor control of wood fires leads to frequent temperatures fluctuations which adversely affects the quality of cured tobacco. The field tests showed that the use of charcoal could increase returns from the sale of cured tobacco by 20 per cent. The improvement in quality proved to be the most attractive characteristic of charcoal use for tobacco curing and concerned this agricultural subsector to be one of the most attractive market outlets for Viphya charcoal.

The other important market that was assessed by the Malawi Charcoal Project was the household sector. In the five major towns of Malawi, annual charcoal consumption was estimated to be 50,000 tons in 1989. Prices of hardwood charcoal had been rising partly as a result of increased population and the Forestry Department campaign to stop illegal charcoal production in 1987. As shown earlier, the average price of softwood charcoal from Viphya was competitive with that of traditional hardwood charcoal.

To reach the household market, the Project first eschewed the traditional charcoal marketing channels and established a new distribution channel. With the assistance of SEDOM, a local small enterprise development agency, the project selected 20 small-scale entrepreneurs for a trial marketing campaign. After a few months, this approach was found to be unsuccessful because the entrepreneurs charged high prices in attempt to realize very high profit margins.

Used to the generous subsidies from SEDOM, many of the selected business people not paying the project for the ordered supplies of charcoal although the credit period had been limited to 30 days.

The poor performance of the small-scale entrepreneurs was compounded by the scepticism of the public used to purchasing charcoal by volume. The lower bulk density of softwood charcoal led to complaints on the part of customers that more fuel was needed to cook. Complaints persisted even when project personnel stressed that the softwood charcoal was sold by weight rather than volume.

Nevertheless the Project was convinced that the market was there. The total potential market for softwood charcoal from industrial, tobacco farming and household sectors is shown in table 4.


Table 4. Potential markets for softwood charcoal (1990-1995) (tons per Year)

As a result of the lessons learned in the initial market test, the Project changed its marketing strategy and adopted a dual approach. The first was to target traditional charcoal distributors who would use the traditional marketing channels to distribute the softwood charcoal from Viphya so as to reach the low-income segment of the population. The second approach was to distribute charcoal in supermarkets and petrol stations in attractive packages aimed at reaching medium- and high-income groups. This strategy appeared to show more encouraging results.