COMMODITIES: Reduced Mozambique Grain Supply Lowers Cross-border Trade

Maize

Maputo, Mozambique, November 8, 2019//-Trade between Mozambique and some of its neighbouring countries in the Southern African Development Community (SADC) region is lower as a result of reduced outputs in the staple maize in the nation.

According to the Food and Agricultural Organisation (FAO), World Food Programme (WFP) Crop and Food Security Assessment Mission (CFSAM) special report to Mozambique, the estimated 2019 cereal production is around 2.8 million metric tonnes, which is about 16 percent lower than last year.

However, this is above the five-year average.

The decline in production is mostly from a sharp decrease in maize production.

The production of the staple grain is estimated at 2,1 million tonnes, and an estimated 233 000 tonnes decrease in rice production, due to the Cyclone Idai and Kenneth-induced crop losses.

The Famine Early Warning Systems Network (FEWS NET), stated that in particular, the supplies from the southern and central regions were below average resulting in atypically high price increases.

“Cross border trade with Zimbabwe is typically low, although during economic crisis trade typically increases,” FEWS NET stated.

However, the agency noted that this year, as a result of the current macroeconomic situation in Zimbabwe, an increasing number of middle and better-off households are crossing the border into Mozambique to purchase food such as cooking oil, sugar, flour and bread.

“On the other hand, the typically significant trade with Malawi, particularly for maize grain, is currently below average due to below-average crop production in the central region,” FEWS NET stated.

Regarding domestic trade, major trade flows are occurring as typical throughout the country, but with below-average traded volumes of food commodities in some routes due to the reduced crop production.

Maputo markets and other major southern markets are largely being supplied by maize grain originating from the central region, except for a few markets in Inhambane Province, which are locally supplied.

As typical, the central and northern regions’ markets are largely supplied by maize grain from local or nearby districts within the respective regions.

FEWS NET noted some flows from the north to central regions, the maize grain flows from north to south were relatively small due to higher transaction costs, except for food commodities with higher profit margin such as beans and groundnuts.

In Beira, Maputo, Gorongosa, Mocuba, and Pemba markets, maize grain prices increased 35 percent on average from August to September.

In Gorongosa, the national reference market, maize grain prices increased 51 percent from August to September.

On average, current prices are 45 percent above the 5-year average and 65 percent above prices at the same period of last year.

Both maize meal and rice prices, substitutes for maize grain and mostly imported, are relatively stable; however, 15 percent above the five-year average for rice and 8 percent for maize meal.

The average maize price across local markets is 25 Metical (R7 or US$0,40).

The 2019/20 agriculture season started with land preparation and planting in parts of Maputo and coastal areas of Gaza and Inhambane where rainfall started mid-October.

Mozambique is still reeling from the effects of the Cyclones Idai and Kenneth.

According to the CFSAM report, the central provinces, which are the main cereal-producing areas, were the worst affected by the cyclones. A smaller area of crops was also lost in the southern provinces of Gaza and Maputo, due to poor rainfall.

The CFSAM report estimates nearly 19 000 cattle, small ruminants and pigs were lost due to atypical dryness and tropical cyclones, with most animal deaths occurring in Sofala.

Additionally, about 22 000 chickens were lost mostly due to flooding.

Cyclones Idai also pounded Malawi and Zimbabwe. More than 1 300 people were killed overall. Damage was estimated at over $2 billion.

https://www.africanpress.co.za/commodities-reduced-mozambique-grain-supply-lowers-cross-border-trade/

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