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Effects of coffee rust, rising food prices, and unfavorable forecasts complicate food security in the region

  • Remote Monitoring Report
  • Latin America and the Caribbean
  • April 2014
Effects of coffee rust, rising food prices, and unfavorable forecasts complicate food security in the region

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  • Key Messages
  • Market Behavior
  • Coffee Sector
  • Health and nutrition
  • Projected regional outlook through September 2014
  • Perspectiva regional proyectada hasta septiembre de 2014
  • Key Messages
    • Purchasing power for the poorest households in the region will be affected if the trend in rising red bean prices continues from May to August 2014, worsening acute food insecurity outcomes to Stressed (IPC Phase 2) for some households.
    • In El Salvador, WFP estimates that 20 percent of the 49,734 households involved in coffee-growing activities, such as laborers, are using atypical coping strategies. In Honduras, there are 9,150 households consisting of laborers and small coffee producers facing the same situation due to a lack of food reserves, according to the Honduran government and international assistance agencies.
    • Because of reduced revenues from coffee production and the depletion of food stocks, households with laborers and small coffee producers in El Salvador will see Minimal (IPC Phase 1!) food insecurity from April to June. Due to the absence of assistance from July to September, they will shift to Stressed (IPC Phase 2) acute food insecurity.
    • Due to a lack of income from picking and selling coffee and low food reserves, farmer and day laborer households in the western and southern areas of Honduras will continue to experience Stressed (IPC Phase 2) food security outcomes until the Primera harvest in September. In Nicaragua, food insecurity will remain Minimal (IPC Phase 1), as a result of grain reserves, alternative sources of income, and the supply of Apante crops.
    • Climate models predict a 60 percent chance of a developing El Niño sometime from June to August, which may affect Primera and Postrera seasons’ crops, mainly in the regions with chronic periods of drought (dry corridor).
    • According to the Nicaraguan Export Processing Center (CENTREX), total bean exports have increased over the last three years. Exports for 2013 were up by eight percent from the previous year. Figures for the first quarter of 2014 were up by 135 percent from the same quarter of last year (the equivalent of 18,869 metric tons of exports). These successive incremental increases in exports could be driving rises in red bean prices by reducing domestic market inventories.
    • Eighteen percent of the estimated total volume of Apante crops was harvested in the first week of March. This harvest accounts for 46 percent of domestic production. Output from this harvest is expected to help stabilize domestic market prices.
    • Most staple grain crops for the Postrera Tardía growing season in Honduras have already been harvested. The only harvests still pending are in crop-growing areas of Comayagua and Olancho, which will take place at the end of April. However, prices are still rising, which is affecting purchasing by poor households to meet household consumption needs. The situation could get worse in the medium term.

    Market Behavior
    • The steady rise in red bean prices across the region during the first quarter is unusual for that time of year. Though government officials maintain that there is no reason for the price increase with the availability of domestic production, they have, nevertheless, responded with measures designed to stabilize the market, such as the distributions of grain from strategic government reserves to consumers in Honduras.
    • Red bean prices on wholesale markets in Honduras have been steadily climbing since last November, peaking at 2,145 Lempiras/200 lbs. (the average March price), which is 28 percent above the figure for February and 102 percent above the figure for March of last year.
    • Wholesale prices for red beans in Nicaragua followed this same steady upward trend, peaking at 1,330 Córdobas/100 lbs. on the Managua market (the average March price), which is 12 percent above the figure for February and 96 percent above the figure for March of last year. Nicaragua exports red beans to neighboring countries. All Apante crops are expected to be harvested by the end of April.
    • Wholesale prices for red beans in El Salvador have also been climbing since January of this year, reaching a high of US$ 48.33 /100 lbs. on the San Salvador market in March, which is seven percent above the figure for February and 24 percent above the figure for March of last year.

    Coffee Sector
    • According to the Nicaraguan Export Processing Center (CENTREX), green coffee exports for 2013 totaled 97,213 MT, which is 18 percent under the figure for 2012 of 118,686 MT. There were 20,185 MT of exports between October of last year and February of this year, 47 percent less than for the same period of 2012/2013. 
    • The damage caused by the coffee rust outbreak and drop in international coffee prices during the 2013/2014 season in El Salvador severely affected coffee-growing areas, crowding out jobs for very poor households. There are an estimated 49,734 households dependent on day labor in coffee-growing activities which are classified as food-insecure (November 2013 – Impact Assessment of the Rust Outbreak, WFP / Salvadoran Coffee Council / Save The Children / Oxfam). The conclusion from this joint assessment and field visits conducted at the beginning of this year is that approximately 20 percent of this group of households is resorting to unusual survival strategies.
    • According to assessments by the government and international cooperation agencies, there are 9,150 households of small coffee growers and day laborers in coffee-growing activities in Honduras classified as severely food-insecure as a result of the damage to coffee plantations from the coffee rust outbreak and the drop in international coffee prices  (United Nations Office of the Resident Coordinator/REDHUM, Situation Report No. 1, issued on March 19, 2013).

    Health and nutrition
    • The Honduran government is launching its “2014 School Snack” program targeted at 400,000 public school students across the country. The snacks to be offered to children in public schools consist of a fortified corn and soybean tortilla, beans, rice, an egg, and milk. Thus, they have a high nutritional value and high energy content, containing protein, folic acid, and vitamins B1, B6, and B12.

    Projected regional outlook through September 2014
    • According to ENSO (El Niño-Southern Oscillation) forecasting models, there is a 60 percent probability of the development of El Niño conditions during the three-month period between June and August, producing rainfall anomalies affecting Primera and Postrera staple grain crops in area countries. This would primarily affect drought-prone areas (in the Dry Corridor). These same El Niño conditions (affecting rainfall, temperatures, luminosity, and relative humidity) could also be conducive to the spread of the coffee rust fungus across the region, which would cause even greater socioeconomic damage.
    • In El Salvador, the combined effects of the lack of jobs for day laborers in the coffee harvest and the crop losses of small coffee growers, the rising price of red beans, and the lack of grain reserves are making affected households vulnerable to food insecurity. These households will experience Minimal food insecurity (Phase 1!, IPC 2.0) between April and June, when the WFP is planning to provide food assistance to 8,850 households under its Food for Assets / Food for Training program. However, without the benefit of food assistance, their food security situation is expected to deteriorate between July and September, exposing them to Stressed levels of acute food insecurity (Phase 2, IPC 2.0) during this peak price period for staple grains.
    • In spite of the damage to coffee plantations and losses of staple grain crops from the last Primera growing season, poor households in Nicaragua will be able to meet their needs until the upcoming harvest (in September of this year) with their grain reserves, alternative sources of income, and supplies of Apante crops as of March and, thus, will experience Minimal food insecurity (Phase 1, IPC 2.0). However, there are a number of communities in the municipalities of Cusmapa (Madriz), Macuelizo (Nueva Segovia), and Estelí (San Juan de Limay), where rainfall anomalies affected Primera crops and the impact of the coffee rust outbreak left households with lower or no incomes, which could be facing Stressed levels of food insecurity (Phase 2, IPC 2.0) throughout the first half of the year and beyond, until the September harvest of Primera crops.
    • Poor households in western and southern Honduras dependent on income from the coffee harvest (day laborers and small coffee growers) and other households in these areas whose Primera crops from last season were affected by rainfall deficits will also face Stressed levels of food insecurity (Phase 2, IPC 2.0) through the first half of the year and beyond, until the harvest of Primera crops in September.

    Perspectiva regional proyectada hasta septiembre de 2014
    • Los modelos de predicciones de ENSO (El Niño-Southern Oscillation), pronostica con un 60 por ciento de probabilidad de desarrollo del fenómeno de El Niño durante el trimestre junio a agosto, lo que implicará irregularidades de lluvia que afectarán las Siembra de Primera y Postrera de granos básicos en los países del área. Las regiones principalmente afectadas serán las que presentan recurrencia a sequias (corredor seco). Paralelamente las condiciones que derivan de El Niño (precipitación, temperatura, luminosidad y humedad relativa) podrían ser propicias para la expansión de la roya en el café en la región, que significará una acumulación más profunda de daños socioeconómicos.
    • En El Salvador, la falta de empleo en el corte de café y pérdida producción del pequeños productor, adicional al incremento de los precios del frijol rojo y la falta de reservas de granos, predispone la inseguridad alimentaria a los hogares afectados, clasificando en Mínima seguridad alimentaria (Fase 1!, CIF) durante el periodo abril a junio, en donde el PMA tiene previsto proporcionar asistencia alimentaria a 8,850 familias con el programa Alimentos para la Creación de Activos / Alimentos por Capacitación. Se espera que de julio a septiembre se deteriora su situación cayendo en inseguridad alimentaria aguda en Estrés (Fase 2, CIF), por ser el periodo de mayor carestía de los precios de los granos básicos y la ausencia de asistencia alimentaria.
    • Pese a los daños a la caficultura y las pérdidas en las siembras de Primera de granos básicos en la temporada pasada, los hogares pobres de Nicaragua podrán cubrir sus necesidades hasta la próxima cosecha (septiembre 2014), gracias a las reservas de granos, las fuentes alternativas de ingresos y el suministro a partir de marzo de las cosechas de Apante; clasificándolo en Mínima seguridad alimentaria (Fase 1, CIF). No obstante existen determinadas comunidades de los municipios de Cusmapa (Madriz), Macuelizo (Nueva Segovia), y Estelí (San Juan de Limay) en donde las anomalías de lluvias afectaron la siembra de Primera y además los ingresos de las familias se redujeron o eliminaron por los efectos de la roya,  estas comunidades podrían afrontar inseguridad alimentaria en Estrés (Fase 2, CIF), a partir del primer semestre del 2014 hasta septiembre que se obtiene la cosecha de Primera.
    • Los hogares pobres que dependen del ingreso por el corte de café ubicados en la regiones Occidental y Sur de Honduras (jornaleros y pequeños productores de café), en donde además existen hogares que fueron afectados por déficit de lluvias en las siembras de Primera en la temporada pasada, experimentarán inseguridad alimentaria en Estrés (Fase 2, CIF) desde el primer semestre del 2014, hasta la salida de la cosecha de Primera en septiembre 2014.
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    Figure 1

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    In remote monitoring, a coordinator typically works from a nearby regional office. Relying on partners for data, the coordinator uses scenario development to conduct analysis and produce monthly reports. As less data may be available, remote monitoring reports may have less detail than those from countries with FEWS NET offices. Learn more about our work here.

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