Stressed (IPC Phase 2) outcomes persist for most poor households

• From October 2024 to May 2025, Venezuela faces Stressed (IPC Phase 2) outcomes at the area level. Although the economic crisis has affected millions of households, exchange rate stability, declining inflation, and increased oil production have contributed to the progressive economic recovery that is reducing the number of people in need of food assistance. However, Crisis (IPC Phase 3) outcomes are projected to persist for a portion of the poorest households. Despite seasonal improvements, the population in need is estimated to remain between 1.0 and 1.49 million people between October 2024 and May 2025.
• Price stability has favored improvements in food security and access to food, especially for households with income in USD, those who receive international remittances, and those with regular access to bonuses and heavily subsidized CLAP (Comités Locales de Abastecimiento y Producción) boxes. In this context, the population of concern continues to be very poor households that do not have sources of income in USD and that have limited access to international remittances or social programs, with concentrations in urban and peri-urban areas, especially in Anzoátegui, Monagas, Sucre, Zulia, and areas close to the capital.
• Monthly and annual inflation rates are expected to remain below 5 and 50 percent, respectively, and cereal prices are expected to remain stable. Seasonal improvement is expected from October to January due to higher income from bonuses, higher seasonal employment, and an increase in holiday remittances, which will allow some poor households to move from experiencing Crisis (IPC Phase 3) to Stressed (IPC Phase 2). However, in January, given the seasonal decline in income and continual pressure from inflation, a portion of poor households will see their purchasing power reduced and experience consumption gaps, thus falling back into Crisis (IPC Phase 3) outcomes through May.

For the past decade, Venezuela has experienced an economic and social crisis characterized by the accelerated loss of purchasing power due to currency depreciation, high inflation rates, and the deterioration of productive and industrial capacity, especially agricultural and oil production. In this context, household income generation has been reduced, limiting access to food. The volatility of the local currency gave way to the progressive informal dollarization of the economy, as a strategy to preserve purchasing power and facilitate commercial transactions. The crisis also resulted in a significant flow of millions of Venezuelan migrants to other countries; mainly within South America, with Colombia being the primary recipient, followed by Peru and Ecuador. However, after the peak of the economic crisis between 2014 and 2020, the country has experienced progressive economic stabilization, driven by lower inflation rates, greater exchange rate stability, and the gradual recovery of the productive structure. Since 2021, monthly and annual inflation rates have slowed considerably and remain below 5 and 100 percent, respectively. 

Nearly 90 percent of the population lives in urban areas and household incomes come from various sources (wages, remittances, and social protection system). Most employees in the formal or informal private sector receive salaries in USD, while the public sector pays in VED. However, half of the transactions in metropolitan areas are made in USD. Households receiving salaries in VED are more vulnerable to experiencing losses in their purchasing power due to VED fluctuations and the conversion to USD for daily transactions. Public sector salaries are set in local currency, creating disparities between private and public incomes. For the poorest households, informal labor predominates, with activities such as street vending, odd jobs, and small enterprises. In rural areas, especially in Guárico, Cojedes, Portuguesa, and Barinas, family farming is very important for the poorest households. Another important source of income is remittances, which vary in amount and frequency of receipt but also help stimulate the local economy, although only a portion of households receive them. In 2023, remittances were estimated to have reached 3.725 billion USD (4 percent of GDP), 10 percent more than in 2022, highlighting the importance of these flows for Venezuelan household consumption. 

The social protection system in Venezuela includes programs that cover food needs, such as the Sistema la Patria system of bonuses (monthly payments indexed in USD and paid in VED), CLAP (Comités Locales de Abastecimiento y Producción, subsidized food boxes regularly delivered to households based on their composition), and the Cesta Ticket (an electronic food voucher provided to public and private sector employees). Public workers and pensioners, who receive their income in VED, are the main beneficiaries of most bonuses. However, CLAP and the Cesta Ticket cover a significant percentage of the population. According to a survey funded by international donors in late 2023, 82 percent of the population reported receiving CLAP boxes, while 62 percent reported receiving government financial transfers during the year. However, the distribution of bonuses and CLAP vouchers and bags can be irregular and not all the poorest households have access to them. 

Due to macroeconomic conditions, the prices of staple food basket products in VED often vary significantly over short periods. A staple diet for most households includes rice, flour, bread, pasta, oil, or margarine, and substitutes such as plantain, pumpkin, and cassava, while chicken and eggs are the main sources of animal protein. However, households adjust their purchasing preferences depending on prices and seasonality. 

National production is organized into two annual harvest cycles: between February and May, and between September and December, harvesting maize, rice, beans, cassava, plantain, and vegetables. Since 2020, a combination of government interventions and improvements in macroeconomic conditions has halted the decline in agricultural production, although it remains below the levels reported during the reference year (2013). This trend places more pressure on cereal imports to meet domestic food needs, which typically account for 57 percent of the domestic supply. Nonetheless, food availability has improved since 2020, and markets are supplied with both national and imported products. 

Learn more

Follow these links for additional information:

• Latest Venezuela Remote Monitoring Report: June 2024 to January 2025
• Latest Central America, Colombia and Venezuela seasonal monitoring: October 2024
• Overview of FEWS NET’s scenario development methodology 
• FEWS NET’s approach to estimating the population in need 
• El enfoque de FEWS NET para estimar la población en necesidad 

National

• In September 2024, inflation in Venezuela continued its slowdown, with a monthly inflation of 0.8 percent and an annual rate of 25.8 percent, significantly lower than that observed in September 2023 (4.6 and 317.6 percent, respectively). The moderation of public spending and the lower volatility of the local currency explain this trend. Food inflation also registered a decrease in September, with a monthly variation of 0.4 percent and an annual rate of 24.9 percent.
• The official exchange rate of the Central Bank of Venezuela (BCV) remained stable in September at 36.91 VED per USD through the sale of foreign currency by the BCV, while the rate in the parallel market varied 3.7 percent compared to August. However, the gap between the exchange rates increased from 19.3 percent to 22.5 percent in October due to the political instability following the elections and the increase in demand for USD in the foreign exchange market, which caused an increase in BCV intervention.
• Public spending in September remained close to the value of the previous month but showed a slower pace of growth between January and September 2024 (145 percent) compared to the same period in 2023 (392 percent). The moderation of public spending is related to the indexation of the payment of bonuses to the official exchange rate, the freezing of the minimum wage since 2022, and the increase in tax collection. This has facilitated the continuation of deliveries of CLAP and other bonuses. Although there are variations in the frequency of distribution, their coverage remains significant.
• In September, food prices remained stable compared to the previous month in VED and USD as a result of the stability of the currency and adequate supply of local and imported products. While food supply is sufficient at the national level, a reduction in the availability of products has been reported in localized areas, especially for staple foods such as rice, maize flour, and oil and hygiene products, without a significant impact on the total supply.
• Over the past 30 days, much of the country has received below-average rainfall, resulting in atypical dryness with below-normal soil moisture in the north of the country and below-average vegetation health and an increase in wildfires in other localized areas (Figure 1). Thanks to widespread use of irrigation, these weather variations have not affected commercial agriculture. The main maize harvest, which is expected to reach a level similar to last year, began in September.

Humanitarian food assistance

• The Food Security and Livelihoods Cluster in Venezuela has reported the delivery of humanitarian food assistance to more than 68,000 people between January and June. However, its deliveries are targeted and do not reach a sufficient number of people to change the food security classification at the area level.

National assumptions

• Monthly and annual inflation in Venezuela are expected to rise moderately but remain below 5 and 50 percent, respectively.
• Oil production is expected to exceed 900,000 barrels per day in 2024 and continue to increase in 2025, which will have a positive impact on government revenues. Despite the gradual recovery of oil exports, the stability of international prices, coupled with the increase in demand for foreign currency in the Venezuelan market, is expected to limit the BCV's capacity to intervene in the foreign exchange market, which would lead to a further depreciation of the local currency and a widening of the exchange rate gap.
• The stability of the local currency, combined with the active intervention of the Central Bank and Chevron's participation in the foreign exchange market, will help contain price volatility. However, the persistence of political uncertainty and the widening gap between the official and parallel exchange rates are expected to push inflation in VED upwards slightly.
• For the 2024/25 agricultural year, commercial maize and rice production is anticipated to be above the five-year average due to progressively improving yields, increased access to inputs and fuel, and more favorable local and international prices for commercial producers. Despite the improvement from the average, higher costs of fertilizers and pesticides in local currency and difficulties in accessing financing caused a slight reduction in yields, keeping 2024 maize production at a similar level to last year. However, rice production is expected to be higher than the previous year, encouraged by higher market prices and better yields associated with favorable weather conditions.
• Cereal prices are projected to remain stable over the projection period due to exchange rate stability and adequate supplies of domestic and imported products. Imports are anticipated to decline from a year earlier due to improved local supplies, with the exception of wheat imports, which are expected to increase due to lower international prices and higher consumption during the holiday season. Food prices in VED are anticipated to increase moderately during this season due to a higher rate of VED depreciation and seasonally increased government spending. Food prices are expected to grow marginally in USD terms due to improvements in foreign currency purchasing power during this period.
• From late October 2024 to early 2025, above-average rainfall is forecast in Venezuela before returning to average levels around March, at the end of the dry season. Despite earlier dry conditions, rainfall will be sufficient for normal crop development throughout the outlook for smallholder farmers. However, above-average temperatures through January 2025 could increase the risk of crop pests and diseases, reduce soil moisture, and increase the risk of wildfires. Additionally, above-average hurricane activity is expected during the 2024 season, extending into early December 2024.

Humanitarian food assistance

National assumption

• Although the Food Security Cluster's official plans for the delivery of humanitarian food assistance are not yet public, deliveries are expected to remain localized for the remainder of the reporting period, without changing the  phase classification in any state.

With macroeconomic improvements, informal dollarization, and stable market supply between domestic production and imports, the shocks of recent years have decreased, allowing for overall improvements in food availability and access for the majority of poor households in Venezuela. In addition, various social programs continue to support access to food for those who receive it through the Patria System, which shows a marked seasonality, with variations in the amounts and types of bonuses distributed throughout the year. During the months of October and November, additional bonuses are delivered, such as holiday bonuses (los aguinaldos) and the economic bonus (Bono Contra la Guerra Económica), which increase the income of beneficiaries. In December, the Christmas bonus (Bono Navidad) is introduced, with an amount of 180 VED, providing extra support for the holidays. In January, the bonuses continue, with adjustments in the amounts. The homeland bonus (Bono Hogares de la Patria) varies from 84.20 to 37 VED, the economic bonus is 710 VED for pensioners, 1,420 VED for active public sector workers, and 1,990 VED for retirees, and the Mardi Gras bonus (bono carnaval) is also announced. Other monthly bonuses (Economía Familiar, 100% Escolaridad. José Gregorio Hernández, Parto Humanizado, Lactancia Materna, Chamba Juvenil, Somos Venezuela, Cuadrantes de Paz, Corresponsabilidad y Formación y Cultores Populares) range in amount from 105.30 to 210.60 VED. This seasonality ensures that poor households receive additional economic support at key times of the year, improving their access to food and other essential goods. Additionally, the CLAP (Comités Locales de Abastecimiento y Producción) box is distributed for low-income households. In September, the box contained 10.5 kg of food distributed in the form of 4 kilos of maize flour, 1 liter of oil, 2 packages of 250-gram pasta, 250 grams of milk, 250 grams of Nutrichicha, 3 cans of sardines, 1 kilo of rice, 1 kilo of sugar, a canned mortadella, 500 grams of salt, 500 grams of peas, and 500 grams of beans. Additionally, as of June 30, WFP and Cluster partners' school feeding programs have served 478,768 people with food deliveries in approximately 2,000 schools in 10 states of the country. The program is expected to continue through May 2025 with the same level of support.

In this context, poor urban households have access to diverse sources of income, including in USD and through remittances and social programs. Although food is a significant expense for most, poor households are able to meet their basic food needs and report consuming a variety of foods. However, with many working in the informal sector with low and irregular incomes and prices still above average, they are limited in their purchasing power and thus resort to coping strategies such as reducing non-essential expenses, seeking additional work, selling personal assets, asking family and friends for help, spending their savings, and buying cheaper foods to ensure their basic food needs. Although almost 90 percent of the Venezuelan population lives in urban areas, there are also poor households in rural areas that are vulnerable to food insecurity. During this year, the crops of producing households had adequate development due to sufficient soil moisture from seasonal rains, despite being below normal in several areas. Despite own production, many rural poor households rely on informal agricultural labor and are resorting to coping strategies similar to urban poor households. As a result, the majority of poor households in all states of Venezuela will face Stressed (IPC Phase 2) outcomes through May 2025. 

However, for a portion of poor households, these improvements have not been sufficient to prevent gaps in their consumption or the use of unsustainable coping strategies. These households will face Crisis (IPC Phase 3) outcomes throughout the outlook. The population of concern remains very poor households that do not have sources of income in USD and that have limited access to international remittances or social programs. These households have already seen a slight decline in consumption and income, accompanied by an increase in expenditures in recent months, especially for food and basic services. This deterioration has been accentuated after the elections, reflecting greater economic instability. This portion of the population is likely spread across all urban and peri-urban areas of the country, with concentrations in Anzoátegui, Monagas, Sucre, Zulia, and areas close to the capital.

A seasonal improvement is expected from October to January due to higher income from bonuses, higher seasonal employment, and an increase in holiday remittances, which will allow some poor households to improve from Crisis (IPC Phase 3) to Stressed (IPC Phase 2) outcomes. However, in January, given the seasonal reduction in income and continued inflation pressure, a portion of poor households will see their purchasing power reduced and experience consumption gaps, thus falling back into Crisis (IPC Phase 3) through May. On the other hand, in rural areas, favorable climatic conditions with above-average rainfall will allow for the positive development of crops (maize, rice, and vegetables) in states such as Anzoátegui, Monagas, Sucre, and Zulia between October 2024 and May 2025. However, high temperatures until January 2025 could reduce soil moisture, increasing the risk of forest fires, while excess humidity could increase the incidence of pests and diseases, causing localized losses. The start of agricultural activities in March will increase the demand for labor in rural areas, slightly decreasing the number of poor rural households in Crisis (IPC Phase 3).

National

The impact of a tropical storm or hurricane

Likely impact on acute food insecurity outcomes: Depending on the trajectory and magnitude of a potential tropical storm or hurricane, direct and indirect impacts could include heavy rainfall with flooding, soil erosion, landslides, and mudslides. It could also change crop production prospects, damage roads, and negatively affect other sources of income and food, increasing the population experiencing Stressed (IPC Phase 2) or Crisis (IPC Phase 3) outcomes.