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East Africa

Prices of coarse grains generally declined in February but still relatively high

11/03/2020

In most countries of the subregion, prices of coarse grains declined seasonally in February as the recently completed second season harvests increased market supplies. Prices remained, however, well above those a year earlier across the subregion due to reduced first/main season harvests and to the difficult macro-economic situation in the Sudan and South Sudan. In addition, heavy rains in late 2019, which disrupted agricultural and marketing activities, contributed to sustain the high level of prices in several countries. In Uganda, prices of maize declined seasonally for the second consecutive month in February as newly harvested second season crops increased market availabilities. However, prices remained above their year-earlier levels, mainly due to a reduced first season harvest and strong exports to Kenya and South Sudan. Similarly, in Rwanda and Burundi, prices of maize declined further in February, and at a steep rate, as “2020A” season crops continued to boost market supplies. Prices remained higher than a year earlier, supported in Rwanda by the impact of the closure of border custom posts with Uganda. In Kenya, prices of maize declined in February in Mombasa market, located on the coast, where the secondary season “short-rains” crops were recently harvested, while they remained virtually unchanged or weakened elsewhere. Prices in February were significantly higher than a year earlier, mainly due to substantial shortfalls in production from the main “long-rains” harvest, concluded in late 2019. In South Sudan, prices of maize weakened for the second consecutive month in February as the second season harvest, recently completed in southern bi-modal rainfall areas, increased market availabilities, while prices of sorghum remained stable. Overall, prices of coarse grains in February lingered at exceptionally high levels, mainly due to a difficult macro-economic situation and the lingering impact of the prolonged conflict. In Somalia, prices of sorghum continued to decline in January with the secondary “Deyr” harvest, recently completed and estimated at an above-average level. By contrast, prices of maize increased in the main producing area of the Lower Shabelle Region, where floods resulted in substantial production shortfalls. Overall, prices of sorghum and maize were higher than in the same month last year due to a tight supply situation following a poor 2019 main “Gu” harvest. In the United Republic of Tanzania, prices of maize declined in February with the secondary “Vuli” harvest but remained well above their year-earlier values, mainly due to strong export demand. In Ethiopia, prices of maize declined in December and in January as the recently completed “Meher” harvest increased market supplies. Despite the recent declines, however, prices were still higher, on a yearly basis, mainly due to the depreciation of the country’s currency, which resulted in increased transport and production costs. The notable exception to the general decline in cereal prices is the Sudan, where values of sorghum and millet surged in February, in spite of the recently concluded 2019 harvest, and were at exceptionally high levels, due to a poor output and a weak currency, coupled with fuel shortages and high prices of agricultural inputs inflating production and transportation costs.