Conflict and a macroeconomic crisis drive above-average needs through September 2021

• Displacement due to tribal clashes, above-average staple food prices and continued macroeconomic difficulties are contributing to higher-than-normal emergency food assistance needs in Sudan during the post-harvest season. These needs are expected to persist into at least May 2020, particularly as the lean season in agricultural and agropastoral areas approaches. Between February and September 2021, most areas of Sudan will face Minimal (IPC Phase 1) or Stressed (IPC Phase 2) acute food insecurity, although parts of Jebel Marra, South Kordofan, Red Sea, Kassala, North Kordofan, and North Darfur will be in Crisis (IPC Phase 3).

• On February 21, Sudan's government devaluated the Sudanese Pound from 55 SDG/USD to 375 SDG/USD at commercial banks and declared a policy of flexible management in foreign currency rates. In the parallel market the exchange rate remained at 385 SDG/USD. The forex deprecation rate will likely be lower through March as the market adjusts to the new economic policy. During this time, prices are likely to remain high but not significantly change. Beginning in April, the gap between the official and parallel exchange rates will be determined by the availability of hard currency reserves.

• National cereal production for the 2020/21 main summer season in Sudan is estimated at 7.6 million metric tons, approximately 7 percent higher than last year’s harvest and 19 percent higher than the five-year average, including a forecasted 695,000 tons of wheat to be harvested in March. Total cereal requirements for 2021 are estimated at around 9.9 million tons, including about 3.5 million tons of wheat. The production of sesame and groundnut—main cash crops—is 6 percent and 15 percent lower than last year, respectively, but 49 percent and 18 percent above the five-year average.

• Staple food prices continued atypically increasing across most main markets in Sudan during the post-harvest period of February 2021. This was driven by the extremely high production and transportation costs, limited carryover stock from last year, and above-average demand for sorghum and millet for local consumption due to shortages, and high wheat and wheat flour prices. Cereal prices in February remained on average over 200 percent higher than last year and over six times higher than the five-year average.

Current Situation 

Emergency food assistance needs will remain above normal through the scenario period driven by poor macroeconomic conditions and significantly above-average staple food prices, reducing household purchasing power through the post-harvest period. In Darfur, tribal conflicts have increased displacement, and households have lost livelihoods assets and access to the recent harvest. The worst-affected areas of Sudan are in Crisis (IPC Phase 3), including parts of Jebel Marra and SPLM-N areas of South Kordofan, tribal-conflict affected areas of Darfur, and poor households in Red Sea and Kassala states.

2020/21 season agricultural production

According to the findings from January's Annual Crop and Food Supply Assessment Mission (ACFSAM), national cereal production for the 2020/21 main summer season is within the five-year average. According to preliminary findings, total cereal production is around 7.6 million metric tons, approximately 7 percent and 19 percent higher than 2019/2020 and the five-year average, respectively.  This estimate includes 4.9 million tons of sorghum, 1.9 million tons of millet, and around 695,000 tons of wheat in March. However, the anticipated wheat harvest is expected to be around 9 percent lower than last year but 9.4 percent above the five-year average due to flooding damage to the irrigation system in the irrigation sector and high production costs.

Sesame and groundnut production is 6 percent and 15 percent lower than last year but 49 percent and 18 percent above the five-year average, respectively.  Flooding, waterlogging, and sesame gall midge were the primary drivers for the below-average production. Sunflower production is 40 percent lower than last year and the five-year average due to high seed prices and a shortage of seeds resulting in a 60 percent decrease in the cultivated area compared to last year. Cotton production is around 29 percent lower than last year and 17 percent below the five-year average, mainly due to an approximately 13 percent decrease in area cultivated due to flooding and the high cost of cultivation.

According to the CFSAM findings, total cereal requirements for 2021 are estimated at around 9.9 million tons, including about 3.5 million tons of wheat. Households and markets have limited carryover stock, and the Strategic Reserve Corporation (SRC) has no major stock available, which is increasing dependency on market purchases.  Import requirements for 2021 are estimated to be around 2.9 million tons of wheat in addition to 60,000 tons of rice and 10,000 tons of maize.

Tribal conflicts and border tensions

In January 2021, following the UNAMID mission's end, there was widespread violence across the Darfur region. In West Darfur, over 130,000 people were displaced, and two IDP camps were burned down. In South Darfur, around 19,300 people have been displaced following clashes in Toweil village, around 15km southeast of Gereida town. Many houses are reported to be burned down. In Central Darfur (East Jebel Mara) in late January 2021, violent clashes broke out between Fur and Arab tribes at numerous Fur villages located in Sharg Aljebel (East Jebel Mara). In North Darfur state, attacks by armed militias on about 11 villages in the Tawilla area resulted in the displacement of over 15,000 people to main towns and existing IDP camps. These clashes across Darfur have resulted in the loss of lives and livelihood assets, including livestock, market, and household stocks of harvested crops. It has also disrupted the cultivation of winter season vegetables, markets and trade flows, and household market access, livelihood activities, and labor opportunities across the Darfur region.

Tension along Sudan's southeast border with Ethiopia increased in February with the moving of tanks and heavy weapons to the area. The dispute is primarily over the border demarcations of the Al-Fashqa area, but other motivations such as a breakdown in talks over the filling of the Grand Ethiopian Renaissance Dam (GERD) are also likely drivers in escalating the conflict between the governments of Sudan and Ethiopia. 

Macroeconomic crisis

Sudan's macroeconomic situation continued to deteriorate in February 2021 due to persistent structural economic factors that were further exacerbated by tribal clashes and increased tension along the Sudan/Ethiopia border. However, on February 21, 2021, the government devalued the Sudanese Pound from 55 SDG/USD to 375 SDG/USD. The rate of forex depreciation is expected to be lower as the market adjusts to the new policy of flexible management in foreign currency rates adopted by the government. It is likely that the forex rate and the gap between the managed and parallel markets will be determined by the consistent availability of hard currency reserves. As of mid-February 2021, Sudan continues to face severely low reserves of foreign currency. A loss of export revenue due to high production costs, high inflation, and speculation and smuggling has increased shortages of USD in the official banking system and reduced Sudan's access to sufficient foreign exchange resources. In the parallel market, the Sudanese Pound being exchanged for 380-385 SDG/USD. Overall, the Sudanese Pound's depreciation over the last year has significantly reduced government and private sector ability to import essential requirements and increased prices of imported and locally produced food and non-food items. Most non-cereal food items' prices increased 20-40 percent between January and February 2021 and remained 50-100 percent higher than in October 2020 and 250-450 percent higher than February 2020. The rapid depreciation has resulted in a 60-85 percent drop in household purchasing power, particularly among urban poor households. Urban households are increasing their dependency on support from relatives, extended families while also engaging in coping strategies indicative of Crisis (IPC Phase 3). According to the Central Bureau of Statistics (CBS), the national inflation rate increased by 14.99 percent from 254.34 percent in November 2020 to 269.33 percent in December 2021.

Although the transitional government is committed to implementing economic reforms to improve the economy, limited donor support currently sustains significant monetization, currency depreciation, and high inflation. The increased economic hardship has aggravated the situation and eroded public tolerance for ongoing economic reforms. It has led to wide social unrest across different parts of the country, slowing the reformation process. However, the government is expected to access funding from the World Bank and the IMF after gradually removing the subsidies on fuel, wheat, LPT cooking gas, electricity, and floating the currency.

Prices and term-of-trade

During the January harvest period through the post-harvest period of February, the retail price of sorghum and millet unseasonably increased across most main markets. Sorghum and millet prices increased 5-15 percent across most markets, and prices remained on average over 200 percent higher than January 2020 and over six times higher than the five-year average. In February, the Al Gadaref market's sorghum price increased to 92.2 SDG/kg from 87.8 SDG/kg in January, almost 200 percent above respective prices last year and more than seven times over the five-year average. The high price is mainly attributed to extremely high production and transportation costs following the removal of fuel subsidies in October 2020, limited carryover stock from last year, and above-average demand for local consumption due to shortages and high wheat and wheat flour prices. This has been further exacerbated by the continued rapid depreciation of the Sudanese Pound. Relatively low availability, high and volatile prices, a ban on sorghum exports by the Sudanese government, conflict in the Tigray region, and increased tension along the Sudan/Ethiopia border has reduced exports from Sudan to South Sudan, Ethiopia, and Eritrea. Imports from Ethiopia were above average during the fourth quarter of 2020 as high prices and increased demand by local NGOs and host communities to support the Ethiopian refugees and curtailing supply to the eastern and central Tigray region of Ethiopia due to conflict.

The retail price for locally produced wheat increased 10-20 percent in most main wheat production and consumption markets across the country between January and February 2021 due to tightened market supplies from last year's harvest along with increased demand due to shortages and high prices of imported wheat and wheat flour, and high transportation costs. In Dongola, the main wheat consumption market in Sudan, locally produced wheat sold for 134 SDG/kg in February compared to 124.75 SDG/kg in January 2021 and 36.67 SDG/kg in February 2020. On average, wheat prices in February 2021 are 225 percent above respective prices last year and 550 percent above the five-year average.

Goat and sheep prices increased 10-15 percent across most markets between January and February 2021 due to improved animal body conditions following improved access to pasture and water in most pastoral and agropastoral areas, along with the depreciation of the Sudanese Pound. However, livestock prices in February 2021 remained 120-150 percent above respective prices last year and 400-450 percent above the five-year average. The high prices are primarily driven by the rapid depreciation of the Sudanese Pound, the continued deterioration of the macroeconomic situation, and high transportation costs between areas of production and main markets.

The livestock-to-cereal terms-of-trade (TOT) remained relatively stable compared to last year but 20-50 percent lower than the five-year average across most markets as food prices continue to increase at greater rates than livestock prices. The February 2021 goats-to-sorghum TOT in the El Obied market remained relatively stable compared to January due to similar increases in goat and sorghum prices. However, the TOT was 19 percent above October 2020 due to a 43 percent increase in goat prices compared to a 23 percent increase in sorghum prices over the past few months (Figure 2). In the Kadugli market, wage-labor-to-sorghum TOT remained at 5.9 kg of sorghum per daily wage in January 2021, 74 percent below last year (16.2 kg/daily wage) and 76 percent lower than the five-year average (17.6 kg/daily wage).

Winter season cropping conditions.

The 2020/21 main winter wheat cropping season began on time in most wheat production areas. The total area planted for the ongoing winter season is estimated at around 295,000 hectares, almost 7 percent lower than the area planted last year but 15 percent above the five-year average. However, 272,000 hectares are expected to be harvested, almost 6 percent lower than the area harvested the last year and the five-year average. The decline in wheat acreage is mainly due to fuel shortages at the beginning of the season, shortages and high costs of agricultural inputs, and damage to irrigation systems from flooding, particularly in the irrigated schemes. Overall, the April 2021 local wheat harvest is estimated to be 695,000 tons, similar to last year and 15 percent higher than the five-year average.

Livestock

Improved livestock body conditions and production are being driven by above normal vegetation and improved pasture and water access in most pastoral and agropastoral livelihood zones in western, central, and eastern Sudan. Seasonal movements of transhumant pastoralists with their animals into dry season grazing areas in the southern parts of the country have been reportedly constrained by tribal clashes in the Darfur region in western Sudan and border tensions in eastern Sudan along most traditional animal migratory routes.  Due to the increase in fuel prices and high cost of drugs, vaccines, and transportation, animal product prices in February 2021 increased by 80 and 500 percent compared to October 2020 and February 2020, respectively. The price increases have significantly reduced household access to animal products.  

COVID-19 related information

The Federal Ministry of Health (FMoH) has purchased 8.6 million doses of COVID-19 vaccines for specified target groups. Vaccine distribution is planned to take place in the first quarter of 2021.

As of February 2021, international airports remain open, and there is free movement of goods through seaports and land crossings points; however, population movements across most borders remain controlled. Restrictions on social gatherings and 50 percent attendance at schools and government institutions remain in place. Following the rise in confirmed daily COVID-19 cases from November through December, income-earning opportunities for poor households engaged in casual labor remain below-average as better-off households seek to reduce their risk of exposure.

Income Sources

To cope with the reduced household purchasing power and to compensate in income deficits from typical household income sources such as farming, livestock herding, and the collection and sale of forest products, households across Sudan are increasing dependent on income from seasonal agricultural labor, traditional gold mining, and remittances. Opportunities and wages for agricultural labor remained stable during February due to continued harvesting of the summer season crops in the semi-mechanized and irrigated sectors and wheat cultivation of the ongoing winter season. Wages were 500, 900, and 1500 SDG/day for the traditional, semi-mechanized, and winter season sectors, respectively; on average 100-200 percent above last year, and 400-500 percent above the five-year average. Despite the increase in wage rates, the labor-to-sorghum TOT dropped 10-15 percent between October 2020 and February 2021 as sorghum prices increased by 10-20 percent compared to a 5-10 percent increase in labor wages. An increasing number of people are also engaged in traditional gold mining across Sudan. Field reports indicate an increasing number of people are engaging in gold mining and petty trade in gold mining areas (selling food, tea, and water). Additionally, households report increased dependence on remittances from family members from abroad and within the country for assistance.

Conflict and Ethiopian refugees

According to UNHCR and the Government's Commission for Refugees (COR), refugees have arrived at a decreased arrival rate compared to the beginning of the conflict in November 2020. In the first 10 days of February, an average of 44 refugees arrived per day, compared to an average of 325 refugees crossing per day in December. As of mid-February, over 61,000 Ethiopian refugees arrived in Sudan. Over 20,000 refugees have been relocated from Hamdayet, and Abderafi border points to Um Rakuba camp in Al Gadaref state. UNHCR anticipates approximately 100,000 refugees to arrive over the next six months if instability in Ethiopia's Tigray region continues. The influx of refugees from Ethiopia has increased the number of people in need of humanitarian assistance in Sudan.

Humanitarian Assistance

In November 2020, WFP and implementing partners provided approximately 3.4 million people with 28,464 metric tons of food assistance and 9.6 million USD in cash vouchers. Most beneficiaries were IDPs and conflict-affected people in Greater Darfur, government-controlled areas of South Kordofan and Blue Nile, refugees from South Sudan and flood-affected people, and chronically food-insecure areas of eastern and western Sudan. WFP is also providing food and nutrition assistance to the arriving refugees from Ethiopia. WFP has appealed for 173.8 million USD for funding requirements between January and June 2021.

Summary of Food Security Outcomes

In February, household food security has seasonally improved relative to the lean season period, driven by the increased availability of own production from the ongoing 2020/21 agricultural season, in-kind and cash payments from agricultural labor, and improved income from the sale of cash crops and relative stability of cereal prices, allowing better market purchases. However, the persistent macroeconomic difficulties and continued above-average prices of essential food and non-food items, exacerbated by the widespread tribal conflicts and displacement in Darfur and eastern Sudan, are driving worse than typical food security outcomes during the harvest and post-harvest period. Moreover, the high losses of assets, food stock, and destruction of houses and farms by conflicts combined with extremely high reconstruction costs, food production, and transportation have significantly limited poor households' ability to maintain their typical access to food and income. Therefore, stressed (IPC Phase 2) outcomes persist across many areas of the country, while Crisis (IPC Phase 3) outcomes are likely in conflict-affected areas and areas hosting IDPs such as in Jebel Marra, SPLM-N controlled areas of South Kordofan, the tribal-conflict affected areas of West and South Darfur, and marginal production areas of northern North Darfur, parts of North Kordofan, northern Kassala, and Red Sea states.

Assumptions

The most-likely scenario for February to September 2021 is based on the following national-level assumptions:

• COVID-19 cases are expected to increase through the projection period. COVID-19 prevention and control measures such as social distancing, restricting large gatherings, and wearing facemasks and sanitizing are expected to remain in place. A below-average arrival rate of people and goods through border posts is expected to continue. Compliance with control measures is expected to remain generally low across the country and is expected to have minimal impacts on food and income access through the outlook period.
• The ongoing 2021/2021 crop harvest is expected to be near average across the country despite crop damage from heavy rains, flooding, and waterlogging in August and September 2020, pest infestations in some parts of the country, and shortages of agricultural inputs and labor.
• The ongoing November 2020 to March 2021 agricultural winter season in Sudan is expected to be negatively impacted by shortages and the high costs of inputs and agricultural labor, and limited access to agricultural finance. The total area cultivated this year is expected to be below targeted areas for the season. Below-average yield is expected in the March to April 2021 harvest.
• Al Gadaref, Kassala, and Blue Nile states are expected to continue receiving Ethiopian refugees from Tigray through the scenario period. Up to 100,000 Ethiopian refugees are expected to arrive if instability in Ethiopia's Tigray region continues. The Tigray region's ongoing conflict is expected to increase tension and instability along the Sudan/Ethiopia border.
• The removal of Sudan from the United States of America's State Sponsor of Terrorism list is expected to facilitate Sudan's ability to access funding from the World Bank and IMF and gradually integrate Sudan back into the international economy. Nevertheless, Sudan is expected to continue facing macroeconomic difficulties associated with low foreign exchange reserves in the official banking system and the informal market.
• Based on FEWS NET's integrated FOREX projections, the depreciation of the SDG in the parallel market is likely to be lower through March as the market learns and adopts the new government policy of flexible management in foreign currency rates. After this period, the forex rate and the gap between the managed and parallel exchange rates will be determined by consistent hard currency reserves availability.
• Based on FEWS NET's integrated price projections, retail prices for sorghum and millet are expected to continue to unseasonably increase and remain at exceptionally high prices compared to average before peaking in the lean season between June and September 2021. Overall, sorghum and millet prices are expected to be over 100-170 percent higher than last year and between four to six times above the five-year average during the scenario period. In March 2021, locally produced wheat prices are anticipated to decrease seasonally with the beginning of the winter season harvest and remain more than double compared to respective prices in 2020 and more than 300-400 percent above the five-year average.
• Livestock prices are expected to follow seasonal trends but at relatively high prices compared to average. Prices are expected to increase by 5-10 percent in most markets during the post-harvest period (March 2021) due to seasonally reduced supplies and improved animal body conditions. By April, livestock prices are likely to start seasonally decreasing with the start of the lean season as households sell additional livestock to fund staple food purchases and build household food stocks. Overall, livestock prices are expected to remain almost double compared to last year and 300-400 percent above the five-year average.
• Sudan is expected to import around 2 million MT of wheat between October 2020 and May 2021, compared to 2.5 million MT for the same period last year and 1.8 million MT for the five-year average. Sudan is also expected to import 60,000 MT of rice and 23,000 MT of maize. Levels of imports will remain below average due to the growing foreign exchange shortage.
• Shortages and high fuel prices (diesel) are expected to persist across Sudan through September 2021 due to reduced imports. Fuel prices in remote areas of Darfur, South Kordofan, and Northern states will remain around more than double the prices in central Sudan due to the high cost of transportation.  Increased demand and exceptionally high fuel prices on the informal market are expected through September 2021.
• Through May 2021, income from non-agricultural labor and remittances by migrant family members is expected to be the main income source for most poor households in agropastoral and agricultural areas. Remittances by family members abroad are expected to be negatively impacted by the second wave of COVID-19 control measures. Between June and September 2021, agricultural labor income is likely to improve and represent a significant income source for poor households.
• Based on projected cereal and goat prices, goat-to-sorghum terms-of-trade are expected to continue seasonally declining and remain on average 18-22 percent lower than last year due to higher increases in sorghum prices relative to goat prices.
• Agricultural labor opportunities and wages are expected to decrease seasonally by 10-15 percent by the end of the ongoing harvest and remain at 800-850 SDG per day until June 2021. Wages will then begin to seasonally increase with the start of the next cultivation period and remain around 1000-1200 SDG/day through September 2021. Labor wages are anticipated to be 80-160 percent above last year and 300-400 percent above the five-year average. Laborers are expected to demand higher wages in response to the depreciation of the SDG and rising prices of goods and services. The labor-to-sorghum terms-of-trade are expected to be slightly above last year and 45-50 percent lower than the five-year average.
• According to FAO’s February 2021 Desert Locust Bulletin, locust infestations are likely to decline in the northeast as conditions become dry but may persist along parts of the southern coastal plains in areas that remain green. There is a moderate risk that adult groups and perhaps a few small swarms could appear near the Eritrea border and breed, especially if additional rainfall occurs. 
• The ongoing peace process between the Sudanese government and the Sudan Revolutionary Front rebel alliance is expected to bring more stability in the conflict-affected zones of Darfur, South Kordofan, and Blue Nile and encourage the voluntary return of IDPs throughout the outlook period. However, sporadic tribal clashes are expected to continue in parts of Darfur, Kordofan, and eastern Sudan. No major new internal displacements are expected. Overall, the number of IDPs in Sudan is expected to remain around 1.5 million, mostly in Darfur, South Kordofan, and the Blue Nile. The number of refugees from neighboring countries, primarily South Sudan, and Ethiopia is expected to remain around one million through the outlook period.
• Tensions over the border dispute between Sudan and Ethiopia are likely to continue during the outlook period with increased military presence along the border. The border situation will remain tense while sporadic attacks by armed militiamen in eastern Sudan are likely to increase.
• Intercommunal conflict incidents and sporadic attacks on villages will continue through the outlook period, with clashes likely to increase during the planting and rainy season (June-August/September), coinciding with the seasonal movements of nomadic groups to the normal wet season grazing areas.
• WFP and implementing partners are expected to provide approximately 78,852 MT of emergency food assistance and 10 million USD in cash vouchers to over 2.6 million beneficiaries. Most of the targeted beneficiaries are IDPs and conflict-affected people in Greater Darfur, government-controlled areas of South Kordofan and Blue Nile, refugees from South Sudan, flood-affected households, chronically food-insecure areas of eastern and western Sudan, and newly arrived Ethiopian refugees fleeing conflict in the Tigray region.

Most Likely Food Security Outcomes

February to May 2021 is the typical post-harvest period and the beginning of the lean season (April to May). During the post-harvest period (February to March), food security outcomes typically stabilize with the availability of the new harvest and will begin to deteriorate seasonally in April as household food stocks begin to diminish. In-kind payments from agricultural labor, cash crops, and livestock are also typically at seasonal lows in April and May. This year the relatively low cereal availability, the anticipated above-average prices of food and non-food items, along with low household purchasing power due to the below-average cash crop production, high inflation, local currency depreciation, and impact of the recent tribal conflicts, will continue to drive higher than typical needs. Staple food prices and household market food purchases are also expected to begin increasing earlier than normal. Due to these drivers, IDPs and poor households in conflict-affected areas in parts of Jebel Marra of Darfur and SPLM-N area of South Kordofan, and new IDPs and people affected by recent tribal-conflicts in West Darfur, South Darfur, parts of North Darfur, and increased numbers of poor households in northern Kassala, and much of Red Sea states will begin to face food consumption gaps by April and likely be in Crisis (IPC Phase 3).

Between June and September 2021, households will enter the lean season’s peak and increasingly rely on markets to purchase staple foods at significantly higher than normal prices. Livestock productivity will be at seasonally low levels during the dry season of May to June. The increases in staple food prices will outpace earnings in cash income from agricultural labor and livestock sales. As the rainy season progresses between June and September, livestock productivity and gifts from better-off households, access to in-kind, and cash income from agricultural labor are expected to increase, providing some improvement in household food access. However, staple food prices are expected to continue seasonally increasing through the lean season, further reducing household purchasing power. Overall, poor households’ food access will continue to deteriorate. The number of people expected to face Stressed (IPC Phase 2) and Crisis (IPC Phase 3) outcomes is expected to increase among poor households in parts of North Darfur, North Kordofan, Red Sea, and Kassala states. In the conflict-affected areas in parts of Jebel Marra and SPLM-N-controlled areas of South Kordofan, areas recently affected by tribal conflicts in Darfur food consumption gaps are expected to widen further, and an increasing number of people will face Crisis (IPC Phase 3) outcomes in the absence of humanitarian food assistance.

Events that Might Change the Outlook

Possible events over the next eight months that could change the most-likely scenario.