Increasing concern for start of 2023/24 rainy season associated with El Niño conditions

• In August and September, Minimal (IPC Phase 1) outcomes are expected as households continue to access food from the recently concluded main harvest and inflation rates decline to their lowest level since early-to-mid 2020, improving household purchasing power. The winter wheat crops are also developing under favorable conditions, with near-average yields expected. From October to January, household food stocks are expected to decline seasonally. Stressed (IPC Phase 2) outcomes are expected to emerge around the start of the lean season in November as households increasingly become dependent on market purchases for food and food prices rise seasonally.
• In July, the headline annual Inflation rate decelerated to 4.5 percent, the lowest rate since early-to-mid 2020, driven by several factors, including declining food and fuel prices and tightening monetary policies, with an associated decline in aggregate demand. The slowdown in inflation means reduced cost of production for farmers and a likely improvement in the purchasing power of poor households. The annual food and non-alcoholic beverages inflation rate slowed to 6.0 percent in July from 8.6 percent in June, likely driven by the harvest in Lesotho and South Africa and lower cost of fuel and transportation. 
• Through the Food Management Unit (FMU), the government purchased 867.6 metric tons (MT) of maize and 166.5 MT of beans in July against a target of 1,200 MT of maize and 240 MT of beans. Around 90 percent of the maize was delivered by farmers from Maseru, Berea, Leribe, and Mafeteng districts. Meanwhile, farmers from Thaba Tseka, Mokholtlong, Qacha's Nek, and Quthing delivered half of the beans. The food distribution has not started as the maize is expected to be processed and fortified with Vitamin A first. Targeted beneficiaries are expected to engage in community projects to receive food.
• Climate forecasts suggest increasing confidence in a strong El Niño by late 2023. El Niño is typically correlated with below-average rainfall in Lesotho. Based on historical trends during El Niño years, the onset of the main rainy season between October and December will most likely be delayed with mixed performance. Irregular rainfall will most likely compound the impacts of reduced access to agricultural inputs on planted area, affecting income-earning among poor households who rely on agricultural labor opportunities. Close monitoring of rainfall totals and distribution will be required to assess the severity of adverse impacts on cropping conditions for the 2023/24 harvest. Government and donors should prepare now for rising food assistance needs in 2024.

In August and September, most poor households in rural Lesotho face Minimal (IPC Phase 1) outcomes, with normal access to income-earning opportunities and food from their stocks following the end of the near-average 2023 main harvest. Households' food stocks are expected to last three to four months, but as food stocks decline, households will increase their reliance on market purchases for food. In July, decreasing global maize, wheat, and edible oil prices helped lower South African export prices, resulting in lower food prices in Lesotho. Maize meal is retailing at around 7.8 to 11.2 LSL/kg (~0.44 to 0.62 USD/kg) in July, but prices are around 15 percent higher than last year (Figure 1). 

Prices of other food items, including vegetable oil, split peas, and beans, also decreased with the incoming harvest and lower import costs but were either higher, similar, or lower compared to prices last year. However, maize meal prices are expected to remain stable through January but higher than last year's prices and the five-year average. Stable prices of fuel and energy products and lower regional fertilizer prices are stabilizing the landed price of imported foods into Lesotho, and are expected to continue to support imports from South Africa through at least January 2024. 

Economic activity in Lesotho has also gained pace due to stronger performance within the transport and construction subsectors, offsetting a moderation in manufacturing growth. South Africa's state-owned Trans-Caledon Tunnel Authority signed a 3.2 billion South Africa Rand (ZRA) (~167.9 million USD) loan agreement to support the construction of the second phase of the Lesotho Highlands Water Project (LHWP). The LHWP transfers water from the upper Orange-Senqu River basin to the Vaal River Dam, which supplies water to Johannesburg and the surrounding region. The project is expected to increase the capacity of Lesotho's water exports from an annual 780 million cubic meters to 1.2 billion cubic meters. The additional spending and investment in infrastructure will support and drive Lesotho's economic growth while generating positive spillover effects into the services sector.

In August, pastures and water conditions for livestock are in good condition and readily available following the cumulatively above-average rainfall recorded during the 2023/24 rainy season. Livestock body conditions remain fair to good, and income from mohair and wool is expected to improve with improved market access in the post-COVID era. The good residual moisture is also supporting the production of winter wheat, which is developing under favorable conditions with expected near-average yields. The residual soil moisture also supports household gardening activities, along with household food access and petty trade opportunities. 

Land preparation for the 2023/24 agricultural season is expected to begin in September and October, providing income-earning opportunities for poor households. However, the onset of the rainy season from October to December will likely be delayed with mixed performance based on historical trends during El Niño years (Figure 2). Based on five strong El Nino events, median rainfall in the December to February period indicates that rainfall is likely to be 60 to 75 percent of the 40-year average in western Lesotho, with rainfall in the east 75 to 90 percent of the 40-year average. Irregular rainfall will most likely compound the impacts of reduced access to agricultural inputs on planted areas, affecting income-earning among poor households who rely on agricultural labor opportunities. Close monitoring of rainfall totals and distribution will be required to assess the severity of adverse impacts on cropping conditions for the 2023/24 harvest. 

Around mid-October through January, the winter wheat harvest is expected to improve poor household access to income from crop sales, when food prices are likely to rise as households increase their reliance on market purchases of maize meal for food. However, the rise in food prices and the likely impact of El Niño on planted area and agricultural labor opportunities is likely to impact household purchasing power, driving Stressed (IPC Phase 2) outcomes in the worst affected areas.   

Recommended citation: FEWS NET. Lesotho Remote Monitoring Update, August 2023: El Niño expected to impact the start of the 2023/24 rainy season, 2023.