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Farmer earnings decline as maize prices drop substantially

  • Key Message Update
  • Zambia
  • July 2017
Farmer earnings decline as maize prices drop substantially

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  • Key Messages
  • Key Messages
    • Generally, Minimal (IPC Phase 1) acute food insecurity outcomes are expected across the country from July 2017 to January 2018 as household food supplies increase considerably with the recent harvest. Household dietary diversity has improved as access to a variety of foods has increased. Despite this situation, the 2017/18 annual Vulnerability Assessment and Analysis by the Zambia VAC assessed sixteen chronically food insecure areas and found that nine of the districts are in need of food or cash assistance from August 2017 to March 2018. Additionally, a monitoring system to track food security status has been recommended to be put in place for these areas. 

    • Maize marketing activities are slower than usual due to low local and regional demand. Therefore, maize prices range from around ZMK 40-50 per 50 kg bag in most districts, which is causing concern among farmers. In comparison to last year, current maize prices have dropped by more than 50 percent. In a few districts (e.g. Monze & Mkushi) maize prices are slightly higher at ZMK 55-65 per 50 kg bag, however this may be temporary. Soya bean prices have also dropped by as much as 65 percent in comparison to the previous season because current supply is much higher than demand. Meanwhile, the Food Reserve Agency (FRA) announced on July 25th that the buying price for the season will be pegged at ZMK 60 per 50 kg bag. This price is disappointing for farmers that were anticipating a better price from the FRA.  The FRA is likely to purchase 500,000 MT of maize for the strategic grain reserves starting in August. 

    • Formal maize exports to mostly Tanzania continue, but at a slow pace despite the removal of the export ban and 10 percent export duty. Drivers of this may include the limited regional market and the logistical challenges of exporting to Kenya. Additionally, the recent appreciation of the local currency will make Zambian maize more expensive and less competitive. In contrast, substantial levels of informal maize continue to be exported to the Democratic Republic of the Congo (DRC) and Tanzania. Meanwhile, the tender by the FRA to sell 100,000 MT of last season’s maize to potential exporters closed and it is in the process of awarding the successful bidders.

    This Key Message Update provides a high-level 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. Learn more here.

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