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Humanitarian assistance expected to begin in Chikwawa and Balaka districts; the national maize deficit remains

  • Food Security Outlook Update
  • Malawi
  • August 2016
Humanitarian assistance expected to begin in Chikwawa and Balaka districts; the national maize deficit remains

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  • Key Messages
  • Current Situation
  • Updated Assumptions
  • Projected Outlook through January 2017
  • Key Messages
    • Planned maize imports are expected to cover only 40 percent of their national cereal supply gap for 2016/17. Low cereal supplies are constraining efforts to locally purchase cereals for subsidized commercial sales, humanitarian response, and for the national reserves. Typically, tobacco sales provide a considerable amount of foreign exchange earnings for Malawi, but this year earnings are more than 30 percent below average, which is further limiting the country’s capacity to import the much needed grain.

    • Although Agricultural Developing and Marketing Corporation (ADMARC) outlet markets are open, to date only 60,000 MT of the minimum amount of 250,000 MT has been purchased locally to replenish supplies. The availability of supplies for purchase by both ADMARC and among private traders has been impacted by the below-average 2016 production. According to government estimates, the Strategic Grain Reserve (SGR) will require a minimum of around 262,000 MT in order to cover the requirements for humanitarian assistance, however only 80,000 MT has been purchases locally so far. 

    • Maize prices continue to increase amid low income opportunities for poor and very poor households. In July 2016, prices of the maize staple were 192 percent higher than five-year average price and 88 percent higher than the July 2015 average price. These abnormally high prices are reducing household access to staple food and worsening food security outcomes, especially among very poor and poor households.

    • Since July, the Food Security Cluster has rolled out assistance to an additional two districts amid funding challenges. In addition to Nsanje district, half-rations are also being distributed in Chikwawa and Balaka districts. In the presence of this assistance, Stressed (IPC Phase 2!) are projected for the August to September and October to January period in all three districts. Agriculture Cluster activities, including the distribution of seeds, inputs, livestock support, and small-scale water harvesting activities have not started. 

    Current Situation
    • The results of the Household Economy Approach (HEA) outcome analysis conducted by FEWS NET in May 2016 indicate that a large population of very poor and poor households, especially in the south, will experience Stressed (IPC Phase 2) and Crisis (IPC Phase 3) acute food insecurity outcomes, requiring emergency assistance to protect livelihoods and cover food consumption gaps. These acute food insecurity outcomes in about 24 out of the 28 districts are expected to persist in some areas and worsen in others during the second half of the outlook period (October to January), in the absence of humanitarian assistance.
    • The national Food Insecurity Response Plan (FIRP) was launched on July 13th. The main sectors in the plan include Food Security, Nutrition, Agriculture, Health, Education, Protection, and WASH. Although there is still a large funding gap for this plan, the Food Security Cluster has been given priority to start providing assistance to the populations identified as acutely food insecure in the 2016 MVAC report. The Food Security Cluster is now providing assistance in three districts in the south. Since the current program has only secured about 30 percent of the needed funding, half rations of the in-kind food assistance is being distributed in these areas. Full rations are expected to begin in September.
    • Agricultural labor opportunities for very poor and poor households will be very low in the August to September period thereby reducing access to food and other basic necessities. The July to September period is when  agricultural labor activities are at their lowest in a normal year. Usually during this period, limited labor is availability from irrigated farming in areas with irrigation. Overall, irrigated agriculture activities are much lower than usual for this time of the year due to drought and extreme dryness.
    • Maize prices continue to remain atypically high for this time of the year. The national average price for maize across 72 markets monitored by the Ministry of Agriculture Agricultural Market Information System (AMIS) from an average of MWK 204/kg in June to about MWK 221/kg in July. The July prices were 192 percent higher than the five-year average and 88 percent higher than the average price July 2015. These price increases are mainly due to significantly below average maize production experienced in the 2015/16 production season which has led to significantly below average supplies on the markets. Given tight supplies of maize across the country due to significantly below average production, maize prices are expected to be atypically very high until September. In the October to December period these prices are expected to reach record high as a result of dwindling supplies in the absence of major imports by the government. Prices of alternative food commodities like rice and cassava are expected to follow the same trend also largely due to low market supplies.
    • Malawi continues to face a cereal deficit of about 1 million metric tons for 2016/17. Opportunities for local and regional procurement of the maize staple are very limited as the Southern Africa regional supply levels are about 30 percent below the five-year average. The country’s inability to import needed supplies is being exacerbated by low foreign currency reserves due to below average foreign earnings for tobacco this season.
    • In mid-August, ADMARC reported only managing to purchase about 25 percent of their projected purchases for subsidized commercial sales pegged at a minimum of 250,000 MT. Additionally, the SGR has managed to buy around 30 percent of the 262,000 MT of cereals required for humanitarian response. ADMARC reports indicate low local supplies are making it difficult to purchase substantial amounts of grain from farmers. This month the Malawi Kwacha continued to slowly depreciate.
    • Informal imports recorded a significant a drop decrease between June and July by dropping by about 65 percent and are 12 percent below the five-year average. This is in sharp contrast to the 109 percent increase that was recorded between May and June. This decrease is mainly the result of a drop in quantities flowing from Tanzania due to more lucrative selling prices in the Horn of Africa region. Since the start of the consumption season, about 16,000 MT of maize has been informally imported. Informal exports for the month are over 90 percent below the five-year average.

    Updated Assumptions

    The current situation has not changed the assumptions used to develop FEWS NET’s most likely scenario for the period of June 2016 to January 2017. A full discussion of the scenario is available in the Malawi June 2016 to January 2017 Food Security Outlook

    Projected Outlook through January 2017

    Based on field assessments and an outcome analysis by FEWS NET in May 2016, FEWS NET estimates that atypically large populations in about 25 out of the 28 districts across the country will face Crisis (IPC Phase 3) acute food insecurity outcomes from August 2016 through January 2017, in the absence of assistance. In the absence of humanitarian assistance, poor and middle-income households in districts severely affected by drought in southern Malawi will be in danger of facing Emergency (IPC Phase 4) food security outcomes.

    This Food Security Outlook Update provides an analysis of current acute food insecurity conditions and any changes to FEWS NET's latest projection of acute food insecurity outcomes in the specified geography over the next six months. Learn more here.

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