Marketing difficulties for peanuts lower incomes for producers

• The low levels of purchase of unshelled peanuts by oil producers at the official price of 200fcfa per kilogram has resulted in a price reduction of 13-26 percent compared to 2013 and 2 percent compared to the average, which is negatively affecting incomes for producers who are already suffering production shortfalls.
• Pasture deficits recorded in the north of the country have led to an early departure for livestock to suitable areas. Livestock production will see a sharp drop from April to June in the north because of this pasture deficit.
• Househols in deficit production areas will rely on coping strategies in an attempt to cover their production losses and improve their incomes in order to meet their consumption needs as they experience and early return to market purchase. These households in Louga, Matam Kafrine and Diourbel regions will be in Stressed (IPC Phase 2) acute food insecurity beginning in April 2014.

Harvests of market garden crops are underway at market gardening sites across the country, where there are average to above-average levels of crop production. The beginning of the marketing season for onion crops is providing job opportunities and higher incomes for farmers, particularly with the reportedly large increase in output. The volume of production is estimated at approximately 200,000 metric tons, compared with an average of 135,000 metric tons. The government freeze on imports on February 24th of this year guarantees market gardeners sales opportunities for their crops. Off-season rice crops in the Senegal River Valley and the southern part of the country are making fairly good progress. The expected average harvests of these crops in May-June will improve household food availability and income in these areas.

The availability of fresh crops is currently helping to improve household cereal access in spite of the production shortfall from the main harvest. However, the well-below-average levels of household cereal stocks due to the below-average production, particularly in the northern and central reaches of the country, will make households more market dependent than usual as early as May-June, rather than July-August.

As of the end of January, prices for locally grown millet and rice were down by approximately five percent from the previous month, while prices for maize and sorghum were virtually unchanged. Prices for millet/sorghum and maize are above the five-year average by approximately 10 percent and 6 percent, respectively, while prices for locally grown rice are approximately nine percent below-average, though well-above-average in Dakar (+20%), Kaolack (+15%), and Saint Louis (+16%). Prices for imported rice, the main staple food, are unchanged from last month and approximately 11 percent below-average, which is helping to improve household food access. There will be a seasonal rise in food prices between February and June.

This year’s problems in the peanut trade are prompting farmers to offer more cereals for sale or to sell their peanut crops   at low prices, which is lowering the incomes of small farmers forced to sell more to meet their needs. Sales revenues from peanut and cowpea crops in particular in the northern part of the country and in peanut-producing areas are down sharply from December 2013 and approximately 15 percent lower than last year. Cowpea prices are six percent above-average, while prices for shelled peanuts are two percent below-average.

Supplies of livestock are down from last month, particularly in the northern part of the country where poor pastoral conditions are prompting pastoralists to head back to relatively lush grazing lands in Mali earlier than usual. Prices for cattle are up slightly, by two percent. Prices for goats and sheep have dropped by approximately nine percent after the high demand for the celebration of the “Grand Magal” in Touba. Livestock prices are still above-average and are sustaining the market access of agropastoral households. However, the drop in animal production and in the market value of livestock in northern pasture-defit areas during the lean season between April and June will undermine the purchasing power of pastoral households.

Poor households in crop-growing areas with remaining food supplies from on-farm production and income from the sale of these crops in addition to their earnings from regular income-generating activities will be able to meet their food needs through the month of March. The stronger than usual market dependence of poor households in areas with production shortfalls by April-May will prompt them to scale up atypically their income-generating activities in order to meet their needs through the end of June. Most household groups will experience Minimal acute food insecurity (IPC Phase 1) between February and June. However, poor agropastoral households affected by below-average production in the Louga, Matam, Kafrine, and Diourbel regions and expected to be hard hit by rising cereal prices as of April and lower incomes due to marketing problems for their crops and livestock will face Stressed acute food insecurity (IPC Phase 2). These poor households will resort to normal coping strategies such as borrowing, sales of non-productive assets, and cuts in essential non-food spending. The price stabilization policy for rice, the country’s main grain crop, and the average outlook for income-generating activities should maintain acute household food insecurity at Stressed levels (IPC Phase 2) between now and the next harvest in September.