Poor harvests and high prices of basic commodities hindering food access for poor households

Stressed (IPC Phase 2) outcomes prevail in most deficit- as well as some surplus-producing areas as harvesting progresses and improves food access. Below normal crop production in the 2021/22 agricultural season is anticipated to result in the gradual emergence of Crisis (IPC Phase 3) outcomes in worst affected districts by August. Meanwhile, in surplus-producing areas, near-average 2021/22 harvests and 2020/21 carryover stocks will likely allow most of these areas to maintain Minimal (IPC Phase 1) outcomes throughout the outlook period. Urban areas are likely to remain Stressed (IPC Phase 2) through September given below normal income and spiking prices.

Since the end of April, the local ZWL currency has depreciated from 159 ZWL:USD to 291 ZWL:USD by end of May on the official auction market. The official rate now nearly matches the reintroduced interbank rate (averaging 299 ZWL:USD), but remains significantly below the parallel market exchange rate of around 450 ZWL:USD. In the face of continued devaluation, there is mounting pressure to dollarize the Zimbabwean economy. However, the government has reiterated it will maintain the dual currency and has announced additional measures meant to promote the appeal and use of ZWL and control depreciation and inflation.

In addition to inflationary pressures, shortages of some basic food commodities including cooking oil, maize meal, and sugar have been reported on the market, with some formal wholesale and retail outlets rationing units sold per customer, or selling exclusively in USD. Some of these commodities are increasingly being sold in the informal sector at significantly higher than normal prices. The government has responded to shortages by lifting import bans and suspending duties on selected imported basic food and non-food commodities for six months starting May 17.

At the end of April, the government announced a continuation of the policy that maize, wheat, and soya beans be controlled products to be sold solely to the Grain Marketing Board (GMB) or contractors. In addition, the government acceded to farmer demands for payments in USD by announcing that 30 percent of payments for maize and small grains delivered to the GMB would be paid in USD, the rest to be paid in ZWL.

Amidst increasing fuel and transportation costs and public transportation shortages, the government has revoked the state bus monopoly introduced in 2020 and allowed independent private transportation providers to re-enter the market, a development expected to improve some livelihood activities and access to markets in rural and urban areas.