Cereal prices continue to rise along with a slow start to the agricultural season

According to CHIRPS satellite estimates, cumulative rainfall from June 1 to July 25 is largely 105 to over 145 percent above the 1981-2010 average. However, cumulative rainfall in South Kordofan, southwestern South Darfur, and northern Sudan is 70-95 percent of the long-term average. As of July 27, OCHA estimates that around 32,920 people have been affected by flooding, primarily in Ag Geneina, West Darfur, where flooding has destroyed around 400 homes, damaged over 3,480 homes, and affected around 19,440 people. In southeastern Sudan, rapid impact assessments have determined that over 521,750 hectares have been flooded or inundated, with around 25,750 hectares of cropland flooded. 

In the traditional rain-fed sectors, farmers started planting with the rains as they typically rely on their own seed stocks. However, farmers in the semi-mechanized sectors are facing constraints in obtaining the necessary bank credit to start agricultural operations. High fuel prices and acute fuel shortages are reducing land preparation operations that usually begin in April. In the irrigated schemes, a dam operating engineers and workers strike in early June delayed irrigation water supplies to the fields and an irrigated start to the agricultural season before the rains were fully established. The delays in planting, lower than typical planted acreage, and lower access to irrigation are likely to reduce the harvest, particularly for staple food crops.   

Sorghum and millet national average retail prices remained high in July, selling on average at 455 SDG/kg compared to 411 SDG/kg in June. Sorghum prices in July are 182 and 613 percent higher than their respective prices last year and the five years average due to reduced market supplies, above-average demand, and high inflation. Cereal prices are likely to continue increasing through the lean season, likely peaking in September before the typical start of the harvest. Nationally, the goat-to-cereal terms-of-trade, a proxy for pastoral household purchasing power, is around 98 kg sorghum per goat, and  57 kg of millet per goat in July, around 9 and 52 percent lower than last year. The decline in the goat-to-cereal terms-of-trade is driven primarily by high demand for sorghum and millet due to the high wheat prices and high reliance on market purchases following a below-average 2021/2022 harvest.

Sudan continues to experience poor macroeconomic conditions due to persistent shortages of hard currency reserves, a poor SDG to USD exchange rate, and high inflation. This has continued reducing the government and private sector's ability to import essential food and non-food items, including improved seeds (primarily for sunflower and vegetable production), fertilizers, herbicides, and pesticides for the recently started 2022/2023 agricultural season. Additionally, the high food and non-food prices limit household purchasing power, with market-dependent poor households engaging in consumption and livelihood coping strategies indicative of Stressed (IPC Phase 2) or Crisis (IPC Phase 3) to minimize food consumption gaps such as reducing meal sizes and frequency, eating less preferred foods, withdrawing children from school, and increasing their dependence on remittances from family and friends. 

According to Sudan's Central Bureau of Statistics (CBS) bulletin for June 2022, the annual national inflation rate was around 149 percent, around a 30 percent decline compared to May (~192 percent). The national inflation rate was also almost 64 percentage points lower than June 2021 but remained 8 percentage points over the five-year average. Although the national inflation rate is declining, the inflation rate remains very high, resulting in the high cost of food and goods. However, the exchange has been relatively stable since April, with commercial banks and the parallel market trading at similar prices. In July 2022, the SDG:USD exchange rate was 565 SDG per USD, around 26 percent higher than in July 2021. Neverthelss, household purchasing power remains low.