Malawi News

Maize deficit fuels price rise

Maize deficit fuels price rise

Malawi is experiencing a negative balance in maize supplies, with overall production 28 percent lower than the five-year average.

Informal imports have proven insufficient to offset this deficit, according to an analysis by the Famine Early Warning Systems Network (Fewsnet).

Despite an increase in informal maize imports, which totalled approximately 99,043 metric tonnes (MT) from April to August 2024—compared to just 13,560MT during the same period last year, representing a 630 percent increase—the imbalance persists.

The analysis indicates that the Agricultural Development and Marketing Corporation (Admarc) and the National Food Reserve Agency (NFRA) have only managed to purchase less than 70,000MT, far below the 261,000MT required to meet the country’s growing needs, including humanitarian assistance and subsidised commercial sales.

However, the stock may be even lower, the report says.

Recently, NFRA said that the agency has slightly over 60,000MT of maize in stock, which represents a 50 percent shortfall from the 120,000MT required for the strategic grain reserve.

In an interview Tuesday, Admarc spokesperson Theresa Chapulapula confirmed that the State grain trader has procured 32,000MT of maize.

The Fewsnet analysis further notes that the below-average maize supplies are driving food prices up, prompting Admarc to raise its maize prices in September from K600 to K790 per kilogramme—almost equal to or exceeding the prices set by private traders.

Economist Samuel Longwe said maize deficits could significantly impact inflation, as maize is a major component of the food basket.

“Maize carries considerable weight in inflation calculations. The immediate solution would be to import more so that people have better access domestically. In the long term, we need to increase production,” he said.

On March 23, 2024, President Lazarus Chakwera declared a state of disaster in 23 of Malawi’s 28 districts in anticipation of a poor harvest due to the El Niño climatic event, which left over two million people in need of food assistance.

Chakwera estimated that close to 600,000MT of maize, valued at K357.6 billion, would be required for the humanitarian response.

Meanwhile, the government has launched the 2024-25 lean season response programme, aimed at providing humanitarian food assistance to 5.7 million people identified as food insecure.