London and Blantyre - A record global grain harvest has done nothing to help Jailos Kamuloni feed his family in Malawi, where costs have sky-rocketed for the maize flour used to make the thick nsima porridge that people eat at almost every meal.
In parts of southern Africa, drought has damaged crops and cut food supplies for countries lacking the resources to import cheaper grain from overseas. While maize futures in Chicago have plummeted to three-year lows, the price in Malawi has jumped 20 percent in the past month.
It would cost Kamuloni 60 percent of his 15 000 kwacha (R359) monthly salary as a security guard to buy a 50kg bag of maize flour, enough to feed his family for a month. They could no longer afford to eat three meals a day, the 40-year-old father of four said.
Dry weather and rising demand are worsening shortages in parts of sub-Saharan Africa, home to a quarter of the world’s undernourished people. Five of the world’s six biggest maize-consuming countries per capita are in southern Africa, and higher costs have a disproportionate effect on poor nations including Malawi, where people spend about half their wages on food, according to the UN.
World food prices tracked by the UN have fallen 14 percent since reaching a record in February 2011 and are lower than a previous high in 2008, when a food crisis sparked more than 60 riots globally over a three-year period, according to the US State Department. The drop reflects record crops from the US to Ukraine that sent costs down 23 percent last year.
Sub-Saharan African countries have missed out because they rely on local supply, including from South Africa, the continent’s top exporter. Maize costs in Zambia rose 35 percent last year and 38 percent in Zimbabwe through to November, UN data show. In Lilongwe, Malawi’s capital, the price jumped 70 percent to 139.90 kwacha a kilogram. That is almost double the price that Chicago Board of Trade maize futures closed at on Friday.
“Prices generally are much higher in Africa than the rest of the world because of booming demand,” said Edward George, the head of soft commodities research at Ecobank, which operates in 34 African countries. “It’s grown in most countries, but what they grow is still not enough.”
In Zimbabwe, the biggest maize importer in sub-Saharan Africa, output declined 17 percent last year from a year earlier because of dry weather, boosting its total grain import requirement to 765 000 tons, 23 percent more than the prior season, the UN said. The country faced an “exceptional shortfall” in aggregate food supplies, with 2.2 million people expected to experience food insecurity through March, according to the UN.
Lack of rain has raised concern for next season’s crop in South Africa. In Zambia, poor rain and late deliveries of fertilisers meant output “could nose dive to record low levels”, the National Farmers Union said earlier this month, without giving a crop forecast.
The price of white maize, used for food, surged as much as 27 percent since the end of October last year to a record R3 039 a ton on Monday on the SA Futures Exchange.
At the end of November, South African stocks of all varieties of maize were 20 percent smaller than a year earlier, the most recent data from the SA Grain Information Service showed. Its exports since the start of May last year are up 49 percent year on year, spurred by rising food demand in Zimbabwe and for yellow maize used for livestock feed in Japan, Taiwan and South Korea, according to the service.
“The recent price increases have mainly been influenced by internal supply and demand factors,” said Jonathan Pound, an economist at the UN Food & Agriculture Organisation (FAO) in Rome who monitors grain supplies in southern Africa. “If prices persist at this level in South Africa, it could have an impact on domestic prices for some importing countries and a negative impact on consumers.”
Of the 842 million people who were undernourished from 2011 to last year, more than 222 million were in sub-Saharan Africa, the FAO estimates. While US shoppers spend about 6.6 percent of their income on food, the lowest of any country, according to the US Department of Agriculture, the UN estimates Malawians spend about 54 percent of their wages to eat.
At a political rally on January 10, President Joyce Banda, who seeks re-election in May, acknowledged that hunger in Malawi had hit a critical point and that her government would ensure local supplies were available.
About 1.86 million people would need food assistance before the harvest started in March, the Malawi Vulnerability Assessment Committee said. Even though the country will produce about the same as last year, drought has sparked localised shortages, and high fuel costs mean it is expensive to transport grain from regions of surplus to those in deficit, according to the UN. – Bloomberg