Humanitarian assistance needs remain high while fuel, transport, and bread prices increase

In June, there was a marked increase in the number of attacks by Non-State Armed Groups in Cabo Delgado, primarily in districts where little or no conflict had previously been reported. Although some IDPs have returned to their homes, humanitarian needs remain high. In June 2022, the IOM DTM, estimated that around 946,500 people are likely displaced in Mozambique, a 21 percent increase since February 2022. Around 70 percent of IDPs live with host communities, with the remainder in displacement sites. There is concern that increased insurgent activity and insecurity could limit humanitarian access and possibly suspend activities in Ancuabe, Macomia, Meluco, and Nangade districts. An increase in IDPs will further strain the response capacity of the humanitarian community. However, WFP secured funding to avoid an October pipeline break until January 2023. WFP continues to distribute HFA rations equivalent to 39 percent of daily kilocalories in Cabo Delgado, Nampula, and Niassa. 

In June 2022, maize grain prices in most monitored markets remain steady compared to May, when prices typically reduce. However, maize grain prices decreased by 12-41 percent in Mutarara, Caia, and Montepuez, likely due to maize grain becoming available at local markets following a delayed 2021/2022 harvest. Across monitored markets, maize grain prices in June 2022 are stable, above-average, or below-average compared to their respective prices in 2021 and the five-year average. As typical, maize meal prices were stable from May to June 2022 in most monitored markets, except Quelimane and Chókwe, where prices increased by 10 percent. Similarly, rice prices in monitored markets increased between 5-18 percent or declined between 11-13 percent from May to June. The monthly variations in maize meal and rice prices are primarily driven by local demand and supply dynamics. 

In June, fuel prices increased an additional 4-19 percent, following previous price increases in March and May. In July, diesel retails at 87.97 MZN/liter compared to 70.97 MZN/liter in March in Maputo province. The rise in fuel prices is resulting in increasing transport tariffs and food prices. Due to the rise in global wheat prices, bread prices in Mozambique are increasing; however, bread prices have increased at different rates across the country. In Maputo, a bakery contacted by FEWS NET reported that bread prices in July are 12 MZN/loaf (0.19 USD), compared to 10 MZN/loaf (0.16 USD) in March. The rise in bread, fuel, and transportation prices is likely beginning to constrain poor household purchasing power, particularly in urban and peri-urban areas. 

The rise in global food and non-food costs is resulting in higher living costs in Mozambique. In June, the year-on-year inflation rate increased to 10.81 percent, the highest value in over four years, according to the National Institute of Statistics (INE). The increases in food/non-alcoholic beverages and transport prices are contributing the most to the rising inflation rate. Since January 2022, accumulated inflation is at 6.44 percent. Typically, food prices decrease between May and July, driven by increased market supply following the annual harvest, but high transportation costs and increased demand for non-wheat products (maize, cassava, sweet potato) are keeping food prices high. Overall, the general increase in the prices of basic products and services is reducing the purchasing power of most poor households, particularly in peri-urban areas. Currently, households are adjusting their expenses, purchasing less food or non-food items, purchasing sweet potatoes or cassava instead of bread, and reducing consumption of fried foods.