Today’s media coverage highlights two food chain disruptions occurred along different stages of the food supply chain: in Argentina, livestock, aquaculture and agriculture producers are currently struggling to maintain high production outputs due to the persistent drought and to the high temperatures in the country; in Pakistan, several wholesalers and traders in Punjab are contributing to fuel the sugar and wheat crisis that has been affecting the country for months, by hoarding essential food products, such as sugar, rice, wheat, flour and ghee. For this reason, they were punished with a cumulative fine of PKR 600,000 during a clampdown on hoarding and profiteering in five different cities of the province.
Selected daily news on food chain disruptions and countries responses to the COVID-19 impact on food chains.
FOOD CHAIN DISRUPTIONS
The high temperatures and the persistent drought (caused by the weather phenomenon known as La Niña) in Argentina are currently threatening agriculture, aquaculture and farming: for example, farmers estimate that if these unfavourable weather conditions remain unchanged, the production of yerba mate (which is used to produce mate, a traditional South American infused drink) will decrease by 30%, and the production of fruits, vegetables and fish will also be affected. Furthermore, the drought is causing a lack of pasture grass that will affect cattle breeding.
Around 50 wholesalers and 5 traders in several cities of Punjab, Pakistan, were punished with a cumulative fine of PKR 600,000 for being involved in the hoarding of essential food commodities, such as sugar, rice, wheat, flour and ghee. This comes after the country’s Prime Minister had issued directives to take stern action against the hoarding of essential food items to stop the inflationary trends (fuelled by an ongoing sugar and wheat crisis in Pakistan) that are currently weighing on the poor.
IMPACT ON COMMODITIES AND FOOD PRICES
According to the Rwanda Agriculture and Animal Resources Development Board, poachers in Lake Kigali are slowly reducing fish population in the lake by using mosquito nets and snares that capture both fish and eggs. This is already having effects on the prices of fish: according to fish dealers in Kigali, they used to purchase sardines that are commonly known as sambaza for RWF 2500 and sold them for RWF 3000 a kilogram, while now they buy it for RWF 3500 and sell it at RWF 4000. Meanwhile, the US Department of Agriculture has released its production and export forecasts for maize and soybean for the 2020/21 marketing year: according to the federal agency, yields will decrease for both crops, while exports will increase.
In Kigali’s food markets, fish dealers are currently selling their products for higher prices, due to a production drop in Lake Kivu, where fish producers normally breed sardine fish commonly known as sambaza. There are several factors underlying the decline in fish production in Lake Kivu, including poaching: fish mongers use mosquito nets and illicit snares that are harmful to fish reproduction, because they also capture fish eggs (a kilogramme of fish eggs can generate up to 10 tons of fish, once they develop).
The US Department of Agriculture has recently released its November World Agriculture Supply and Demand Estimates, which contain amended supply and demand expectations for the 2020/21 marketing year: maize and soybean supplies were lowered as expected yields were reduced for both crops, and due to the anticipated higher export levels (especially to China), price expectations also rose for the second month in a row. More in particular, the US maize export expectations grew by 325 million bushels, and if they are fulfilled, it would be the largest amount of maize the country has exported on record.
In Africa, Mauritania’s government has recently intervened to solve the transport issues caused by the separatists of the Polisario Front in Western Sahara (who prevented Moroccan fruits and vegetables exporters from reaching Mauritania and other West African states by land), by organizing maritime transport arrangements to and from Nouakchott’s port. In Ethiopia, on the other hand, the Lutheran World Federation and the European Union have joined efforts to provide farmers affected by the damages to crops caused by locust swarms with cash assistance and agricultural inputs. In the Philippines, on the other hand, a provincial government has inaugurated a drying machine that extends the shelf life of several food products without using chemicals, thus making them suitable for exports.
A roadblock in Guerguerat (established by Polisario Front’s separatists), a small village in Western Sahara that represents the only crossing point between Mauritania and Morocco on land, prevented fruits and vegetables exporters from Morocco to transport their products to Mauritania and other West African countries for three weeks. In order to stop the hike in food prices that was caused by these transport issues, Mauritania’s government has intervened by organizing shipping arrangements by sea.
The Lutheran World Federation (a global communion of Lutheran denominations that provides humanitarian assistance in developing countries) is currently supporting farmers in Ethiopia’s Oromia region, which was particularly affected by the swarms of desert locusts that ravaged crops this year. More in particular, the federation, with the support of the European Union, has set up an emergency response in order to provide 15,000 people with improved seeds, food for livestock and cash assistance.
The provincial government of Ilocos Norte, in northern Philippines, has recently tested the country’s first automated multi-crop drying machine as part of a program that aims at improving food security in the province amid the coronavirus pandemic. Thanks to this innovative technology, farmers’ surpluses are processed and preserved for longer periods of time without using any chemical, in order to make them suitable for exports.
Climate change is expected to be the first factor to cause an increase in frequency for what concerns extreme weather events (including heatwaves and persistent droughts) in southern Africa, where almost all of the cultivated area is rainfed; therefore, the region’s agricultural sector is likely to be severely affected by the effects of climate change. For what concerns East Africa, on the other hand, the maize production output estimates in Tanzania are optimistic, while Kenya, South Sudan, Rwanda, Burundi and Somalia will probably witness minor deficits. Meanwhile, Indonesia has claimed that it intends to double the multilateral trade volume with South American and Caribbean countries, such as Brazil, Mexico, Peru, Argentina and Haiti.
Several climate hazards, including droughts, heatwaves and extreme rainfall events, are adversely affecting the SADC (Southern African Development Community) region’s agricultural sector, which is predominantly rainfed (95% of the total cultivated area): due to the intensive impact of climate change, the whole region is referred to as a “hotspot” by the Intergovernmental Panel on Climate Change, and a climate risk analysis and mapping study indicates that these weather events will be more and more frequent by 2050.
The preliminary estimates suggest that maize production during the 2020/21 marketing year will be higher than the five-year average levels in Tanzania, which is therefore expected to have above-average exportable maize surpluses; Uganda and Ethiopia, on the other hand, will have below-average maize surpluses. Kenya, South Sudan, Rwanda, Burundi and Somalia will have minor deficits, and although the maize market in East Africa is expected to be robust, prices will remain high due to the coronavirus pandemic.
During the first eight months of 2020, Indonesia’s exports to South American and Caribbean countries were down by 12.66% year-on-year, while imports fell 13.57%. The main exports to the region included vegetable oil and rubber, while the main destinations were Mexico, Brazil, Peru, Argentina and Haiti. However, Indonesia has recently announced that it aims at doubling the value of business deals to be made with the member states of the Southern Common Market (or Mercosur).