Maize harvest will adequately meet national demand

• Despite an 11 percent drop in the latest national maize production estimates, due to erratic rainfall during the last half of the season, maize production in Zambia will meet national demand with a small surplus. With increasing household food supplies, especially for the northern and central areas, the food security situation is generally expected to remain Minimal (IPC Phase 1) across most of the country during the May to June period. 

• Although poor household purchasing power has improved due to falling maize prices, these prices are likely to firm up by July, once market demand begins to increase and the full impact of the recent 21 percent fuel price increase is felt. This fuel price increase is due to the removal of a fuel subsidy in mid-May; this is expected to contribute to increasing staple food prices earlier than usual this marketing season. 

• Between July and September, acute food insecurity outcomes for most households will remain Minimal (IPC Phase 1) since most rural households will continue accessing food from their own harvest. However, those households in the extreme south that experienced a significantly reduced harvest will experience Stressed (IPC Phase 2) acute food insecurity outcomes. 

As reported in the April 2013 Food Security Outlook, food insecurity among the majority of households in Zambia continues to be Minimal (IPC Phase 1) even as the new marketing season begins in May. With the commencement of the main harvest, most rural households have reduced their dependency on markets for food purchases as household food stocks and variety have increased. This improved dietary diversity is most evident in the northern and central parts of the country where crops performed relatively well, while the situation in the south is less favorable because of the reduced harvests due to erratic rainfall and prolonged dry spells.

Although the estimated national 2012/13 maize production has decreased by 11 percent (down from 2.85 million MT) when compared to the 2011/12 agriculture season, the total supply (including 455,000 MT in carryover stocks) will adequately meet the national requirement of 2.53 million MT. The Ministry of Agriculture and Livestock estimates indicated that Zambia will have a maize surplus of 454,000 MT. Compared to the previous season, Zambia will have reduced exportability this marketing season. As expected among the major production areas, the Southern Province recorded the largest maize production drop (21 percent) due mainly to the late start of season and erratic rainfall. This season there were notable area increases in rice and groundnuts, however crop yields were adversely affected by the erratic rainfall. Soybeans were the exception, and a 45 percent increase in the area planted contributed to a 28 percent increase in production. The  significant reduction in cotton production, triggered by poor prices last season, allowed farmers to increase area planted under soybeans significantly and area planted under maize to a lesser extent (only 3 percent more) when compared to the previous season.

Similar to the start of last marketing season, the Government has announced its intention to purchase 500,000 MT of maize at a fixed price of ZMW65 per 50Kg from small scale farmers through the Food Reserve Agency (FRA) program from June 10^th to September 30^th. This price has been maintained for the past four years and is no longer based on prevailing market conditions. Small traders in Lusaka are currently purchasing maize from farmers at ZMW 55 per 50Kg. Although the Government’s intention is to keep the purchase price high in order to maintain high maize production levels, this program indirectly promotes maize production and not productivity at the expense of other high value crops, which discourages crop diversification, pushes local staple food prices up to the disadvantage of poorer consumers both in urban and rural areas, and encourages farmers to sale most of their stocks early on and to depend on the market for food purchases. The FRA purchase program also indirectly contributes to a steep increase in informal maize inflow from neighboring Tanzania, Mozambique, and Malawi during the program purchasing period, which in some cases benefits traders more than farmers.

Similar to past years, private sector participation will depend on the level of government involvement in the maize market, although some reforms have been announced to reduce the volume of maize purchased by the FRA in order to curb spending and grain storage losses. Staple food prices are currently stable in some areas and declining in other areas as the new harvest starts entering the market. Poorer households in affected areas of southern Zambia are currently meeting their food needs with their reduced harvest while also working for food.

While the police patrols instituted by government at Kasumbalesa border in March have significantly reduced exports, maize prices on the Democratic Republic of the Congo (DRC) side have risen by 85 percent, an incentive for increased informal exports to the DRC. The high demand for Zambian maize coupled with very attractive maize and meal prices in the DRC are expected to increase informal maize exports to that country despite the current tight export restrictions. 

The current situation has not changed the assumptions used to develop FEWS NET’s most likely scenario for the period of April to September 2013. A full discussion of the scenario is available in the Zambia April Food Security Outlook.  

Despite significantly reduced harvests in some southern parts of the country, acute food insecurity is expected to remain Minimal (IPC Phase 1) through June; mainly because households are depending on food from their reduced harvests and staple food prices are decreasing as supplies flow into markets. However, by July poorer households will deplete their own stocks and will face reduced labor demand while at the same time experience an early rise in staple food prices due to the recent 21 percent fuel price increase. This will likely make it difficult for poor rural households in the extreme southern parts of the country to meet basic food needs, and they are likely to look to the Government for assistance in supplementing their food needs. Households with significantly reduced harvests in the extreme southern areas will likely be Stressed (IPC Phase 2) during the July-September period.  The populations needing assistance will be determined through the Zambia Vulnerability Assessment committee (VAC) analysis that is currently underway.