A better climate outlook, with adequate moisture for crop production in the Dry Corridor

• Most models from the latest runs of the North American Multi-Model Ensemble (NMME) are predicting the continuation of ENSO-neutral conditions, in line with ENSO forecasts by the NOAA, CPC, and IRI. Contrary to previous indications throughout most of 2017, the NMME forecast is now predicting a good likelihood of normal or above-normal levels of cumulative rainfall during the Primera growing season. This could help bolster the progress of rainfed staple grain crops in the region’s Dry Corridor.

• There are Dry Corridor areas in all three countries inhabited by small-scale staple grain farmers affected by the anomalies in the distribution and amount of rainfall in 2016. Most poor households in these areas depleted their food reserves sooner than usual and are currently dependent on temporary employment in farming and livestock-raising activities, security jobs, or construction activities in near-by urban areas. Most of these areas are in El Paraíso, Choluteca, Valle, La Paz, Intibucá, and Lempira in Honduras; la Unión, Morazán, San Miguel, Cabañas, Santa Ana, and Ahuachapán in El Salvador; and Nueva Segovia, Madriz, Estelí, and Chinandega in Nicaragua. However, FEWS NET does not expect the severity of food insecurity in any area to exceed IPC Phase 2 (Stressed).

• With the several consecutive years of poor crop production by many subsistence farmers, very poor households in hard-hit areas during both of last year’s growing seasons (the Primera and Postrera seasons) with limited access to temporary employment opportunities will likely be propelled into a Crisis (IPC Phase 3) before the beginning of the harvest of Primera crops in August. Honduras is expected to have the largest number of people in Crisis.

Climate outlook

Forecasts for the rainy season in Central America have changed since the last report published by FEWS NET in May 2017, mainly because of changes in trends in surface temperatures in the eastern equatorial Pacific Ocean. There should be normal to above-normal rainfall activity throughout the entire rainy season, up until November 2017, which could help bolster the progress of staple grain crops in the region’s Dry Corridor, where small farmers have been hard hit by several consecutive years of poor crop production. However, there is a risk of damage to crops from periods of excessive rainfall.

 The models used by the NOAA, CPC, and IRI all show a good likelihood of the continuation of ENSO-neutral conditions in the El Niño 3.4 region through at least the end of the outlook period in January 2018. According to the climate outlook, the expected neutral conditions in the El Niño 3.4 region should produce average to above-average levels of cumulative rainfall over the period between July and September. There could also be a higher likelihood of an uneven (spatial-temporal) distribution of rainfall, particularly in July and August when cumulative rainfall levels ae normally at their lowest and there is a more irregular distribution of rainfall (during the canicula). However, with the expected adequate soil moisture levels at the beginning of this period, the risk of crop damage from insufficient moisture is lower than previously indicated.

Staple grain prices in the region

Maize and red bean prices in Honduras, El Salvador, and Nicaragua were stable or down in all three comparison periods (from the prior month, the prior year, and the prior five-year period). This price pattern confirms the good grain harvests from all three of last year’s growing seasons (the Primera, the Postrera, and the Apante seasons), with markets currently stocked with Apante crops from the recent grain harvest, consisting mainly of red beans. The current price stability also suggests that markets in regional countries presently have larger inventories than in previous years, which will help keep prices stable for a little longer or sustain a measured rise in prices.

International coffee prices

According to the May 2017 market report by the International Coffee Organization (ICO), there was a sharp drop of 3.8 percent in the ICO composite indicator price between April and May 2017 to US$ 1.25/pound, approximately 4.6 percent above the figure for the same month last year.

Staple grain production

According to the Agro-Meteorological Report by the Ministry of Agriculture and Livestock-Raising (SAG) and other government agencies, staple grain crops across the country are currently making good progress, with production levels expected to be close to if not above normal. An examination of maize-growing activities in Olancho shows approximately 28,000 “manzanas” planted in maize crops (a “manzana” is a unit of land measurement equal to approximately 0.7 hectares). The size of the area planted in maize could reach 45,000 “manzanas” by the end of the planting period for the Primera growing season. There will be an estimated 19,500 “manzanas” planted in maize in El Paraíso and another 39,000 in Comayagua and La Paz.

There are optimal growing conditions for bean crops in all parts of the country. The area planted in beans includes an estimated 15,000 “manzanas” in Olancho department, approximately 7,500 “manzanas” in El Paraíso, and 2,125 “manzanas” in Comayagua and La Paz departments. Crops are in the vegetative growth stage, aided by the good climatic conditions during the current rainy season.

Coffee sector

The reported loss of resistance to the rust fungus by the improved Lempira variety of coffee in Honduras prompted PROMECAFE (the Regional Cooperation Program for the Technological Development and Modernization of Coffee Production), backed by the Honduran Coffee Institute (IHCAFE), to conduct a technical field mission in conjunction with (national and international) experts in March 2017 to assess the situation in affected areas. With most Honduran coffee grown by small farmers and approximately 50 percent of the country’s coffee farms and plantations planted in the Lempira variety of coffee, the group concluded that, based on its preliminary observations, the rust pathogen appeared to be extremely aggressive and, thus, that the rust outbreak posed a high risk to both Honduras and the entire region, dictating the need for emergency measures.

According to IHCAFE, the failure to take necessary measures could reduce coffee production in affected areas by as much as 45 percent, which would cause a severe blow to the finances of coffee producers and day laborers in this sector, as well as to farming communities and the national economy. As in past years, any event negatively affecting coffee production in coffee-growing areas of the country would likely have a number of social impacts such as an escalation in food insecurity, rural-urban migration, crime, the break-up of families through foreign migration, etc. However, it is important to keep in mind that infestation rates in all parts of the country are still low.

Food security outlook

Most farming households highly dependent on staple grain production for household consumption affected by the loss of their 2016 crops due to the uneven distribution of rainfall are currently Stressed (IPC Phase 2). The majority of these households are in communities lying within the Dry Corridor (in the southern and southwestern part of the country) in livelihood zones 7 and 5. Households in these areas especially hard hit by crop losses or production shortfalls in 2016, with limited employment opportunities and their coping capacity weakened by the erosion of their livelihoods (from the loss of productive assets, land degradation, and borrowing), living far from urban areas, and with limited access to basic services (health, education, and water supply services) are expected to be in a Crisis (IPC Phase 3) situation from April through at least the month of September.

Staple grain production

The government distributed packages of farm inputs (seeds and fertilizer) for the planting of staple grain crops for the first growing season across the country to small farmers in regions 1, 2, and 3 over the period from May 2nd through May 16th. These same packages were scheduled to be distributed between June 5th and June 21st for the planting of crops in region 4. 

According to a government statement released through the Ministry of Agriculture, the heavy rains in the last two weeks have not affected crops and the harvest forecast for the 2017/2018 season is still on target for a record harvest of staple grain crops.

Coffee sector

Salvadoran Coffee Council records show 835,010 quintals of coffee harvested  as of April 30th (between October and April), eight percent more than the figure for the same time last season, confirming the slight rebound in coffee production.

As part of the recovery program for the coffee industry, the government has begun to distribute 14 million coffee plants to a target population of 6,000 individual and organized coffee farmers for the rehabilitation of 5,696 “manzanas” planted in coffee at an investment cost of approximately USD 5.8 million. The varieties provided by the government are all rust-resistant (Costa Rica 95, Catisic and Lempira (Catimores); Cuscatleco and Zarchimor (Sarchimores); Icatú Rojo, and Icatú Amarillo (Arabustas).

Remittances

Country revenues in the form of family remittances for the first quarter of 2017 came to USD 1,581,100,000, 10.6 percent more than the figure for the same time last year. Revenues for the month of April of this year came to USD 405.9 million, USD 21.7 million more than in April 2016. These remittances come from 131 different countries, though 97.4 percent are from the United States.

Food security outlook

The poorest households in livelihood zones 2, 3, and 4 affected by repeated crop losses from rainfall anomalies and with little access to temporary employment in the coffee harvest due to the limited recovery of coffee-growing areas damaged by the rust fungus are Stressed (IPC Phase 2). Households in eastern and western areas of the country especially hard hit by poor harvests and with limited job opportunities and landless peasants in coffee-growing mountain areas could be propelled into Crisis (IPC Phase 3) before harvesting their 2017 Primera crops. However, since the numbers of these households will not exceed the 20 percent threshold in any area, food security conditions across the country will continue to be classified as Stressed (IPC Phase 2) throughout the outlook period.

Staple grain production

The Production, Consumption, and Trade Plan for 2017/2018 crafted by the government and Nicaraguan production chains sets a production target of 9.2 million quintals for white maize, which boosts production by 1.1 percent. The bean production target is 4.4 million quintals, which is equivalent to a 10 percent production gain. The target for rice production is 5.4 million quintals, which puts production up by 5.8 percent from last season.

Employment and remittances

According to the Central Bank of Nicaragua, labor statistics for the month of April show 914,276 workers covered by the Nicaraguan Social Security Administration (INSS), a 6.9 percent increase from last year. Based on applicable records, the business sectors with the highest inter-annual rates of growth were trade, hotels, and restaurants (at 13.1 percent), agriculture, forestry, hunting, and fishing (at 11.9 percent), mining and quarrying (at 11.8 percent), and construction (at 11.1 percent).

Revenues from remittances for the first quarter of 2017 came to USD 323.3 million, 6.9 percent more than the figure for the same quarter of 2016, accounting for 9.6 percent of GDP for the first quarter of the year.

Coffee sector

According to the 2017/2018 Production, Consumption, and Trade Plan, 171,5000 “manzanas” of coffee crops were harvested during the 2016/2017 growing season, producing 2.5 million quintals of coffee, 13.1 percent more than the figure for the 2015/2016 season. Coffee exports for 2016 came to 2.6 million quintals with a value of USD 402.3 million. Projections for the 2017/2018 season put the size of the area planted in coffee at 180,000 “manzanas” and coffee production at 2.7 million quintals, up 7.1 percent from the last harvest.

Food security outlook

Small-scale staple grain farmers (growing maize, beans, and sorghum) in northern Pacific and northwestern areas of the country in livelihood zones 3 and 12 lost part of their crops for the 2016 Primera and Postrera growing seasons as a result of the rainfall anomalies in these arid areas with degraded soils and pest infestations, particularly infestations of  yellow aphids. With the depletion of their food reserves, these households are expected to be  Stressed (IPC Phase 2) until the harvest of Primera crops in August 2017. Communities in more arid areas of these regions without access to job opportunities could be propelled into a Crisis (IPC Phase 3) before the next staple grain harvest, which could be prolonged in the event of rainfall anomalies affecting crop planting activities for the 2017/2018 growing season.