Trying to make food cheaper

The price of maize, sorghum, wheat and other staple grains is likely to climb again in many food-importing east African countries, agricultural economists warn.

In the third of a four-part series on food security - "Are we heading for another crisis?" - IRIN looks at a region where 20 million people are in need of food aid, and what could be done to avoid another food-price crisis.

Globally, the price of most staples like maize and wheat have been falling, but people in east Africa are still paying up to double the 2007 price, said the new food security update by the UN Food and Agriculture Organization (FAO).

A complexity of factors influences food prices in most of the region's countries: inadequate rainfall and poor harvests, dysfunctional markets, civil conflicts, poor infrastructure and high transport costs. In some instances a combination of all these factors, as in Somalia, could see prices shoot up again, the FAO update said.

Analysts offer a range of viewpoints on why food continues to be expensive, but everyone concurs that the long-term solution of investing in agricultural infrastructure and improving crop yields is eastern Africa's only way out of expensive food.

Agricultural productivity research won't bring prices down immediately, but it's the only way to keep prices down for an extended period

Bottlenecks

Christopher Barrett, a leading food aid expert who teaches development economics at Cornell University, in the US, pointed out that "[Lack of] supporting infrastructure [such as roads and water supply for irrigation] and institutions (such as contract enforcement, seasonal credit availability) drive up costs enormously in more remote areas where the poorest and hungriest continue to live."

Abdolreza Abbassian, an economist at FAO, said "transport bottlenecks and poor infrastructure" often made imported products cheaper than locally produced food. People living in a food deficit area near the border of their country often found it cheaper to buy food from a neighbouring country.

Thom Jayne, who teaches agricultural economics at the US-based Michigan State University (MSU), noted in a new study he co-authored that food prices in many countries in eastern and southern Africa "routinely soar above import parity", meaning that local food cost more than the "price in world markets, plus the cost of importing it to the domestic market".

The MSU study, led by Jayne and David Tschirley, who is also an agricultural economist, found that ad hoc policy decisions meant to stabilize prices instead created uncertainty and put stress on often weak agricultural infrastructure, all of which contributed to pushing up the price tag on cereals above global prices.

Kenya was a good example. The government imposed a 50 percent import tariff to help a small number of farmers who had surplus maize to sell, but hurt the vast majority of the population who bought maize from the market, Jayne told IRIN. In the 2007/08 food price crisis the price of maize in Kenya was the highest in the region.

The government removed the tariff in 2009, but the poor road network from the Indian Ocean port of Mombasa limited food supplies to upland markets, and for a long time local grain prices stayed higher than world prices.

Jayne warned that Kenya could see a repeat of the 2008/09 crisis in 2010 because the country does not have enough food to carry it to the next harvest, and the government has re-imposed the 50 percent tariff on imported maize.

Bringing costs down

Jayne and Tschirley urged greater cooperation and exchange of information between the public and private sectors on food security related issues, such as production estimates and pricing policy, to ensure that people have access to a sustainable supply of affordable food.

Barrett suggested that bringing down the cost of getting produce to markets through better infrastructure was "a real food security strategy", and noted that "We continue to feel the effects of decades of insufficient investment by governments and donors in agricultural research capacity (scientists and laboratories) for development and adaptation of seed varieties, and small-scale field equipment appropriate to local agro-ecologies."

He favoured change that brought lasting benefits. "Unfortunately, there continues to be an obsession with finding quick fixes rather than buckling down and making substantial commitments to the difficult, slow but absolutely essential task of keeping one step ahead of ever-evolving pests, diseases and ... [other] pressures that hurt yields," he commented.

"Agricultural productivity research won't bring prices down immediately, but it's the only way to keep prices down for an extended period - by ensuring supply growth at least keeps pace with demand expansion."

Conflicts

FAO economists Luca Alinovi, Günter Hemrich and Luca Russo suggested in their new book, Beyond Relief: Food Security in Protracted Crisis, that countries in a state of protracted crisis brought on by conflict - such as Somalia, Sudan and the Democratic Republic of Congo - should strengthen their infrastructure and institutions, particularly at local council level, with the help of the humanitarian system.

The authors noted that in some countries suffering a conflict situation or recovering from one, "the humanitarian response framework continues to be virtually the only intervention mechanism, which often undermines those initiatives that require longer-term perspectives."

In case studies in the three countries, the economists found that interventions worked when they took policy and institutional issues into account, and attention for the most part was focused on the local and decentralized level.

"In 2006, 25 of the 39 serious food emergencies [worldwide] were due to conflict and its aftermath, or a combination of conflict and natural hazards," they said.

Here is a snapshot of food insecurity in 10 east African countries in need of food assistance.

Kenya
Type of food insecurity	Exceptional shortfall in food production.
Reason	Adverse weather and lingering effects of civil strife; about 3.8 million people, mainly in pastoral and marginal agricultural areas, are very food insecure; conflicts over grazing resources have also escalated.
Change since Nov 2009	Improving - prospects for second-season crops look good; recent rains have also helped some pastures recover.
Nutritional status	Kenya Integrated Household Budget Survey, conducted between 2005 and 2006, showed that 15 percent of children older than six months and up to five years of age were severely stunted, an indicator of chronic malnutrition.
Consolidated Appeal Process (CAP) funding	More than US$512 million requested, of which 17 percent has been covered.

Somalia
Type of food insecurity	Widespread lack of access to food.
Reason	Conflict, economic crisis, adverse weather in food-producing parts of the country; 3.2 million people, nearly 50 percent of the population, are food insecure.
Change since Nov 2009	No change - cereal production has improved but conflict still affects food security.
Nutritional status	The Humanitarian Action Report (HAR) 2010 by the UN Children's Fund (UNICEF) noted that by August 2009 19 percent of children younger than five were acutely malnourished, with acute malnutrition rates in some areas reaching 27 percent.
CAP funding	US$689 million requested, of which 12 percent has been covered.

Ethiopia
Type of food insecurity	Severe localized food insecurity
Reason	Adverse weather and insecurity in some parts. Some improvement, with the number of people in need of food aid reported in January 2010 at 5.2 million, down from 6.2 million in 2009.
Change since Nov 2009	Deteriorating overall - late and below-average rains in the last meher (second crop) season, from June to October, have affected the 2009 long-cycle crops, like sorghum, and pastures in many parts of the country.
Nutritional status	The 2005 Demographic and Health Survey, the most recent data, showed that according to World Health Organization standards, 24 percent of children aged under five were severely stunted. UNICEF's 2010 HAR said 270,000 children aged under five would require treatment for severe acute malnutrition caused by environmental shocks and conflict.
CAP funding	Ethiopia does not have a CAP. The government's Humanitarian Requirements Document said the country would need $286.4 million for food aid from January to December 2010, and non-food aid for the first six months of 2010.

Sudan
Type of food insecurity	Severe localized food insecurity
Reason	Civil strife in Darfur, insecurity in southern Sudan and adverse weather have worsened the already dire food situation; about 5.9 million people need food aid.
Change since Nov 2009	Unchanged - the situation remains the same as last year, with poor rainfall, conflict and economic constraints persisting. The prices of maize and sorghum, the staple foods, are at their highest levels.
Nutritional status	A Household Health Survey conducted in 2006 found 15 percent of children aged below five severely stunted.
CAP funding	Twenty-three percent of the $1.9 billion requested has been covered. It is one of the top five recipients of aid so far this year.

Eritrea
Type of food insecurity	Lack of access - food is often unavailable, and unaffordable when it is.
Reason	Poor rainfall, economic constraints, and several thousand people displaced by war. About 1.7 million people have been food insecure in the last decade.
Change since Nov 2009	Unchanged - economic and social conditions in the country are the same as last year.
Nutritional status	Lack of access to food has pushed up the incidence of malnutrition, according to UNICEF. Admissions to therapeutic feeding centres were six times higher in 2009 than in 2008.
CAP funding	There is no CAP for Eritrea. So far in 2010 the UN has made $3 million available, and the United Kingdom has given $290,429.

Burundi
Type of food insecurity	Severe localized food insecurity
Reason	More than 90 percent of Burundians depend on agriculture and many were displaced by a civil war that lasted more than 10 years. People continue to return home, where land is scarce and often hit by natural disasters.
Change since Nov 2009	Unchanged - the food situation is the same as last year. Good yields in 2008 caused prices to fall in early 2009, but poor rains followed by floods have affected crops planted in November 2009.
Nutritional status	A nutrition survey conducted in 2005 found 26 percent of children aged below five to be severely stunted.
CAP funding	There is no CAP for Burundi. Efforts to respond to the humanitarian needs have received $405,146 from the European Commission Humanitarian Aid Office and Sweden.

Central African Republic
Type of food insecurity	Severe localized food insecurity
Reason	Refugees and food insecurity in parts. Persistent conflict in the north, with farmers having limited access to land and inputs has affected production.
Change since last year	Deteriorating - insufficient rainfall in the northern regions. The country's mining sector in the southwest has been hit by recession, leading to lay-offs and affecting ability to buy food.
Nutritional status	A UNICEF-supported survey in 2006 found 19 percent of children under five to be severely stunted.
CAP funding	More than $113 million requested.

Republic of Congo
Kind of food insecurity	Severe localized food insecurity
Reason	Internally displaced persons (IDPs), refugees
Change since Nov 2009	Deteriorating - insecurity in neighbouring Democratic Republic of Congo led to more than 100,000 people entering the country at the end of 2009, putting a strain on limited food supplies. Food prices have been rising since the end of 2009.
Nutritional status	A Demographic and Health survey in 2005 found 11 percent of children aged under five to be severely stunted.
CAP funding	Twenty-four percent of the more than $58 million requested has been covered

Democratic Republic of Congo
Kind of food insecurity	Severe localized food insecurity
Reason	Civil strife, returnees. Renewed conflict in 2008 intensified the humanitarian crisis caused by more than 10 years of civil unrest and armed conflict, mainly in the southern and eastern parts of the country.
Change since last year	Deteriorating - Renewed clashes in western DRC, limited access to agricultural inputs, loss of assets in a country that is predominantly agriculture-based. Crop yields were up in 2009 and prices have begun to come down, but are still high as the national currency has depreciated.
Nutritional status	One in every two children across the country is chronically malnourished.
CAP funding	Only 3 percent of the $827 million requested has been covered.

Uganda
Type of food insecurity	Severe localized food insecurity
Reason	Adverse weather, persistent insecurity in some areas. Two decades of conflict displaced at least 1.8 million people. Access to land and markets still limited in some parts. Food prices are high in the chronically food-insecure northeastern Karamoja region.
Change since Nov 2009	Improving - good rains over most of the food-producing areas. According to the Famine Early Warning Systems Network (FEWS-NET), the government has launched a five-year Karamoja Action Plan for Food Security.
Nutritional status	A household survey in 2006 found that 12 percent of children aged younger than five were severely stunted.
CAP funding	The humanitarian community has asked for $197 million.

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