Skip to main content

Strong demand continues to drive up cereal prices

  • Food Security Outlook Update
  • Niger
  • March 2013
Strong demand continues to drive up cereal prices

Download the Report

  • Key Messages
  • Current Situation
  • Updated Assumptions
  • Projected Outlook through June 2013
  • Key Messages
    • Continual high demand from institutions, as well as from consumers and private entities, has driven February cereal prices (especially for millet) upwards to their highest levels in the past five years with prices at major markets anywhere from 14 to 40 percent above-average. However at this time, these unusually high prices are not severely curtailing household food access.

    • Currently, poor households are highly dependent on market purchases to meet their food needs. However, good food access and purchasing power are generally helping to keep food insecurity to a minimum due to the availability of cereal stocks for certain households and to incomes from wage labor and the sale of irrigated crops and livestock for others. 

    • However, certain departments of Tillabéri will require humanitarian assistance from the government and its partners during the month of March to prevent food consumption gaps. 


    Current Situation

    In general, the key market players at this time are local farmers and traders, whose inventories continue to account for a major share of market cereal supplies. As usual, the volume of domestic trade is down from previous months with the steady decline in the inventories of local farmers, who normally engage in rational inventory management practices during this time of the year (the "pre-lean season").

    Imported cereals from Nigeria have begun to show up on local markets. Though still small compared with last year's levels, supplies of these crops are similar to a normal year, where imports account for a sizeable share of market transactions as the stocks of popular local crops deplete. By April/May of a normal year, virtually all cereal supplies on most markets across the country will consist of imports.

    Market demand is strong due to ongoing institutional procurements for the rebuilding of food security reserves, as well as a normal increase in the number of households dependant on market purchases. According to the livelihood profiles, on-farm crop production normally meets the consumption needs of very poor and poor households for three to four months, meaning that food stocks generally deplete in February/March. Therefore at this time, 90 to 100 percent of household food supply comes from local markets. These purchases, coupled with demand from pastoral households and from procurements by institutions such as the government through the National Food Products Office (OPVN), are causing market demand in March to be above the seasonal average. The total amount of direct procurements by the OPVN for 2013 is estimated at 18,622 metric tons of cereals, of which 4,919 MT have already been procured and 13,703 MT of purchases are ongoing.

    In general, staple cereal prices are above the five-year average. This is particularly true for millet, which is the main cereal crop consumed by rural households. Millet prices are reportedly over 30 percent above the five-year average on markets in the Maradi and Zinder regions. In these regions, markets face local consumer demand as well as commercial demand from other parts of the country. Continual strong demand, coupled with the depletion of farmer inventories, will cause prices increases at the rate of five to 10 percent per month even when excluding the possibility of atypically low or irregular imports in the event of low supplies at source markets or the possibility of market disruptions due to security problems.

    Despite atypical market conditions, current household food security is characterized by normal food access and intake, even for poor households. This is due to current household stocks of cereals and other irrigated crops and income from wage labor, livestock sales at above-average prices, and sales of irrigated crops and forestry products. Livestock prices and livestock/cereal terms of trade are 12 to 18 percent above the five-year average due to high demand. In addition, the price of bush straw is above prices from previous months and the average as the result of a growing demand due to limited availability of fresh pasture. On average, prices for market gardening produce (cabbage, tomatoes, potatoes, and lettuce) are equivalent to the cost of one kilogram of millet, compared with 0.2 kg last year and an average of 0.8 kg.


    Updated Assumptions

    Food security indicators trends are consistent with the projected food security outlook for the period of January through June 2013. 


    Projected Outlook through June 2013
    • The April/May to June period will be marked by the seasonal depletion of cereal stocks and supplies of irrigated crops, the main sources of food and household income. Thus, market purchases will become the main source of food and household income will primarily come from the financial resources of returning migrant workers and wage payments for farm labor.
    • Continual high demand for cereals will keep prices at above-average levels but with normal seasonal price trends. Prices will gradually approach, if not surpass, last year’s levels, particularly if the 2013/14 growing season starts normally.   
    • Cereal availability will be ensured by imports during the April/May to September period. This will be bolstered by the sales of locally grown cereals should the progression of upcoming growing season be good as farmers will clear out their remaining food stocks. However, security conditions in Nigeria and production shortfalls due to flooding problems in that country could disrupt trade and limit imports, creating shortages on certain markets, such as Maradi. 
    • The government’s social assistance program will reinforce the livelihoods of very poor and poor households between April and May/June. In addition, subsidized cereal sales and blanket feeding programs will improve food access starting in July/August/September.
    • No negative abnormalities are expected for households living in pastoral livelihood zones. Despite the disruption in seasonal migration to Mali, above-average pastoral conditions are helping to sustain larger numbers of herds during the internal pastoral movements from the north towards southern areas of the country.
    • High prices and the end of certain social assistance programs will reduce food access and cause food consumption gaps for very poor and poor households by June, particularly in Tillabéri, Ayorou, and Torodi departments. Food insecurity in these areas will reach Stressed (IPC Phase 2) levels in May/June 2013. 
    Figures Seasonal Calendar for a Typical Year

    Figure 1

    Seasonal Calendar for a Typical Year

    Source: FEWS NET

    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.

    Get the latest food security updates in your inbox Sign up for emails

    The information provided on this Website is not official U.S. Government information and does not represent the views or positions of the U.S. Agency for International Development or the U.S. Government.

    Jump back to top