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FOOD GRAIN MARKET JL NG , DI STRI 13U F JON MECHAiv i SMS ANI) PROBLEMS IN WOLLO AND A!; TACENT ADM ( NTSTRATTVE ZOr.T^S: ImPLICA'l j ONS l«’OIi HOUSEHOLD FOOD S EC U R. ITY AND 1^0 L 1 CY

Addis Ababa October, 1994

FOOD GRAIN MARKETING, DISTRIBUTION MECHANISMS AND PROBLEMS IN WOLLO AND ADJACENT ADMINISTRATIVE ZONES IMPLICATIONS FOR HOUSEHOLD EOOD SECURITY AND POLICY

A Research Report Prepared for Save the Children (UK) in Ethiopia

DAGNEW ESHETE (Ph. D.) Programme Technical Advisor, SCF-UK

Addis Ababa October, 1994 t SUMMARY \

1. AIMS AND METHODS OF THE STUDY

This study seeks to examine the nature and problems of rural grain production, grain distribution/supply and marketing with an implication for household food security and policy. Specifically the study has attempted to examine the current grain supply and marketing problems in detail in relation to its effect on local and household level food security by administrative zones in the north and north-central region of Ethiopia. A more detailed examination concentrated on particular food deficit areas of North and South Wollo Administrative zones. Most Woredas in these administrative zones are generally food deficit and have been facing recurrent disaster-induced food shortages and famines in recent decades. This study has also attempted to identify the relatively marketable grain surplus areas within and outside Wollo, where people in many grain deficit areas in Wollo depend for their food supply more importantly in bad years.

The main objectives of this study are: a) to help SCF (UK) refine its position on the need for food aid in the north, and to provide a basis for advocating on behalf of that posit ion; b) to improve SCF’s early warning of impending food shortage and f amine; and c) to identify constraints to inter-regional trade and how these might be eased.

The information used in this study is gathered mainly from primary sources through field-research work in sample areas of Wollo and adjacent administrative zones. The principal source of information has been sample survey involving mainly questionnaire-based interviews/discussions with sample representatives (eg, members of SCs/PAs, traders, development agents, etc.) at different levels, direct market observations, and use of official market records.

Given the variations in the natural endowments, settlement patterns, agricultural and other market-based economic activities, established development infrastructures and other socio-economic and communication problems, sample areas were stratified by: - geographical locations (eg, administrative zones and Woredas); - agro-ecologies; - marketable grain surplus producing Woredas, and food deficit Woredas; and - distance from towns, market centers and roads.

The secondary survey areas include purposively selected sample Woredas adjacent to Wollo region which traditionally have strong links primarily in grain marketing. These sample Woredas are specifically located in North Shewa, South Gondar, and East Gojjam. Different formal and informal approaches were used in all survey areas in the process of data collection in order to attain the research objective.

i 2. FINDINGS OF THE STUDY AND CONCLUSIONS

i ) Agricultural Production Traditions

In the study areas, the traditional agricultural practices vary according to the agro-ecological variations. The main types of crops that dominantly grow in Dega (highlands) such as barley and horse beans do not grow in Kolia (lowland) areas. The main Kolia crops that include sorghum, maize and tef, on the other hand, do not grow in Dega climatic zones. Woina-Dega areas (intermediate zone) generally accommodate diverse crops (eg, wheat, barley, tef, maize, sorghum, etc.) that grow both in Dega and Kolia agro-ecologies. This also holds true for livestock husbandry by types and breeds.

Farm producers in parts of Wollo and N. Shewa depend on two rainy seasons for their crop production activities. These are: (a) the Meher season which largely depends on the main rainy season extending from Nay/June to September; and (b) Belg season which depends on a short rainy season generally extending from Feb./March to early May. Some Meher long-maturing crops such as sorghum and maize also benefit from the late Belg rains (April-May) for planting and early stage growth. Kolia areas are not generally users of Belg rains due to its erratic nature. However, little rains that fall during Belg season in Kolia areas are useful for regeneration of pasture for livestock. About 48 percent of the Woredas in Wollo benefit from the Belg rains in relatively normal years. Of these, nearly 63 percent of the Woredas that benefit from the Belg rains are located in South Wollo. T h e overall annual contribution of Belg crop production ranges from 15 to 25 percent in relatively normal years. Belg production contributes 20-25 and 15 percent of the total annually expected harvests in South and North Wollo respectively.

Livestock in Wollo, as in most other regions in the country, play a significant role in the regional economy and in ensuring household-level food security. Livestock possession in Wollo (regardless of their agro-ecological locations) are not only direct sources of household food security; but also sources of power (eg, draught power), means of transportation (as pack animals), and as an important source of cash. In most places, however, the livestock numbers and their productivity are said to be alarmingly declining from year to year due to rapidly diminishing common grazing lands, overstocking, scarcity of pasture and poor watering and veterinary facilities.

Peasants in Wollo still use both inadequate and traditional farm technologies as regards to farm tools, seasonal productive inputs, farm power and other farming practices, which are relatively unproductive. The agricultural extension services are also very poor, and many areas particularly with poor rural road facilities have not been reached at all. In most areas of Wollo, as a result of the growing farm asset decline and lack of reserves, the majority of the rural people are becoming more vulnerable to the recurrent disaster-induced food crisis that has increasingly become a common phenomena primarily since early 1970s. That is, there has been a growing gap between the food requirement of the people and food supply. Food production and supply situation in general is far below the food requirement at a household, local and zonal levels.

As regards the consumers preference in the study areas, barley and wheat in Dega; wheat, tef, sorghum and maize in W/Dega; and sorghum, maize and tef in Kolia areas are the most preferred for consumption and widely traded grain staples.

i i) Food Deficit and Marketable Grain Surplus Areas

Although food deficit areas vary according to their agro- ecological and people’s occupational differences, generally food deficit Woredas by administrative zones include: - Sequota, Ziquala, Abergele, Dahena, Bugna, Gidan, Mekete, Guba Lafto, Kobo and Habru Woredas in N. Wollo; and - Bati, Tehuledere, Worebabo, Ambassel, Dessie Zuria, Kuta-Ber, Kalu, Albuko, Dewerahimedo, Artuma, parts of Esaye-Golla, Tenta, Mekdela, Legambo and Sayint Woredas in S. Wollo.

Some Woredas in N. Wollo such as Kobo, Habru and parts of Guba Lafto, however, become either self-sufficient in food production or produce marketable surplus sorghum in favorable years using Meher rains. Other Woredas, such as Kalu, Tenta, Mekdela and Legambo in S. Wollo become relatively self-sufficient in food production in normal years using both Belg and Meher rains, although there appears to be a generally declining trend in their food production and supply situation in the recent years.

The main marketable grain surplus producing areas in Wollo include: - Jamma, Wore-Ilu, Legehida, Kelala, Wogidi and parts of Esaye Golla Woredas in S. Wollo; and - Delanta, Wadla and Dawnt Woredas in N. Wollo. These areas, which cover about 27% of the total existing Woredas in Wollo have traditionally been supplying many of the food deficit Woredas and urban centers with their marketable grain supplies in both good and bad years. Dera Woreda in North Shewa has been the main supply source of marketable grains (primarily sorghum and Tef) mainly to many markets in the food deficit parts of southwestern Wollo for the past over two decades.

The second important supply sources for marketable grains (mainly Tef, sorghum, chick peas, horse beans and barley in order of importance) are Shebel Berenta and Enesie Sarmidir Woredas in the former Bichena and Mota Awrajas respectively (in the present East Gojjam Administrative Zone). Some particular Woredas in S. Gondar Administrative Zone are the main sources (exporters) of marketable grain staples for many markets in N. Wollo. Woredas including: (a) Estae, Farta, and Fogera Woredas; and (b) parts of Simada, Lay-Gayint, and Tach-Gayint Woredas in the former Debre Tabor and Gayint Awrajas respectively have been the main sources of imported grain staples (mainly tef, sorghum and chick peas).

Analysis of the survey information in food deficit sample Woredas indicate that, the average food self-sufficiency months are about 3, 5 and 9 months for the poor, middle and the rich respectively in normal years. The same information indicates that approximately 50 and 40 percent of the population in these Woredas are from the poor and middle income categories respectively. In the recent decade (normal years), grain production in these areas has been estimated to cover only up to 50-60% of their total annual food needs due to complex production problems. In relatively surplus grain producing sample Woredas, the average food self-sufficiency months are about 5 and 9 for the poor and middle income groups respectively, and over 12 months (with adequate reserves or marketable surplus) for the rich in normal years. In these areas, approximately 30-35 and 40 percent of the population are from the poor and middle income categories respectively. In normal years, the marketable grain surplus produced in these Woredas supplies mainly the food deficit parts or adjacent Woredas in the respective Administrative Zones in Wollo.

i i i) Rural Household Income Sources

Agriculture is the dominant economic activity for over 95% of the people in Wollo and adjacent administrative zones. Other subsidiary economic activities, often termed as off-farm/non-farm income generating activities rural people have been involved for decades include petty trading, selling family labour, weaving, pottery-making, blacksmithing, sales of wood and charcoal, and handicrafting. In more recent years, because of the increasing population pressure aggravated mainly by the influx of settlers from the former resettlement areas and ex-soldiers, the key productive resources such as land have been getting more and more scarce (ie, the number of landless and near-landless rural people have increased). This has led to: (a) a seriously growing rural unemployment problem, and (b) annually declining family food production, food supply and growing food insecurity. As a result of the seriously declining productive resource ownership constraints coupled by the recurrent drought-induced food insecurity, many peasants primarily in chronically food deficit areas make growing efforts to diversify possible subsidiary off-farm income sources as a coping mechanism. Of the many growing additional income generating off-farm activities, petty trading, selling family labour, collection and sales of wood and charcoal are the dominant ones (in order of importance). Survey information indicates that the growing non-farm income generating activities referred to above are largely undertaken by the poor followed by the middle income groups. Such mainly cash income generating activities are mostly undertaken during the slack periods/davs.

As regards income sources by specific social groups, the survey information reveals that, the main sources of cash income for the rich and middle income groups in most survey areas are from sales of crop produce and livestock (mostly small animals). Livestock sale is the primary cash income source for lowland pastoralists. The most common sources of cash income for the rural poor in most survey areas depend

i v on the sales of family labour, sales of wood and charcoal, and petty trading activities. These economic activities get more intensified in periods of growing food shortages as the most important coping mechanisms. Petty trading in this context does not only involve grain trading, but also the trading of mainly small animals as one of the important secondary options.

iv) Grain Marketing and Household Food Security in Wollo

Traditionally, subsistence producers in Wollo and in Ethiopia at large derive most of their family consumption requirements from domestic food production, largely from agricultural (crop and livestock) production activities. Most often, failure to achieve self-sufficiency in food production forces peasants to get involved in the market-based economic activities. In times of deepening food crisis, households tend to intensify market-based economic activities as an income and food supply stabilization (adaptive) strategy. For example, the number of participants in grain followed by livestock petty trading in Wollo has been increasing from year to year (more increasingly since early 1980s) in order to secure their family food security in the face of growing food supply shortfalls.

In Wollo and adjacent areas, grain marketing is often played by merchants and middle-level traders, and mainly rural-based peasant and non-peasant petty traders as their main and secondary sources of income respectively. These are the main agents of food grain distribution generally from relatively grain surplus areas or markets to grain deficit areas or markets at all levels. However, merchants followed by middle-level traders often focus on distant trading, although they use lower-level market centers as their buying centers mostly through their trading agents. Such traders are often perceived by local urban and rural consumers as some of the important factors for worsening (a) food grain scarcity, and (b) grain market price increases at many local and secondary market centres, depressing the purchasing power of the poor mainly in periods of growing food production/supply shortfalls.

A larger number of petty traders are found particularly in food deficit areas of north and south Wollo. Many peasants in these areas are both food grain sellers (as producers and petty traders) and buyers for parts of the year due to insufficiency of their produce to cover their annual food needs. In contrast to grain merchants and middle-level traders, petty grain traders are perceived by local consumers as generally useful trading agents, although their activity is not profit-free. This is because, such traders (including urban-based grain retailers): (a) sell grain at a relatively fair price affordable by the low-income groups; (b) collect grain from both relatively accessible and inaccessible parts of grain surplus localities/marketable grain sources and facilitate grain availability in local and other secondary markets; (c) mostly use pack animals to transport food grains purchased from different local sources which markedly reduces transport costs/unit, positively contributing for the resale of the same at a relatively lower selling prices to consumers; and (d) they often don’t tend to hoard grain as opposed to rniddle-level and big traders with the expectation of higher future prices. Thus, in relative terms, petty grain traders play a useful role in local-based grain distribution, directly or indirectly helping the low-income consumers to get access to or buy food grain at affordable retail prices per unit.

In conclusion, despite the negative effects of the policy-induced trade barriers of the past and the present mainly transportation, communication and trade regulation problems, petty trading (as a secondary occupation) in Wollo and adjacent regions has been one of the vital sources of income and food supply in both normal seasons and crises situations. In particular, petty trading plays a good role in: (a) securing family food security (as income sources for traders themselves); and (b) food grain distribution from supply sources to food deficit areas/market centers in periods of food scarcity not only in Wollo and adjacent regions, but also in the country at large.

v ) Mechanisms and Means of Grain Trading

As regards the rural-rural and rural-urban marketable grain movements or grain trading, petty traders play a dominant role. Low-level urban traders have a small role in the rural-urban grain marketing. Middle and low-level urban traders play a major role in urban to urban (relatively short distance) grain marketing activities. Generally grain merchants are major players in the long-distance grain marketing business.

Rural-rural and rural-urban grain marketing activities in Wollo are often undertaken through the use of traditional means of transport. This involves the use of transport animals such as donkeys, mule and horses. This happens in areas where road facilities do not exist. Human labour is another important means often used to transport marketable food grains and other consumer goods parallel to the use of transport animals. Human labour becomes more important primarily in the rugged/inaccessible rural localities where even the use of animal power tends to be less important.

Generally, for short distance urban-urban grain marketing activities where mostly dry-weather road facilities are available, some light to medium capacity vehicles are used for grain trading. However, even in such short distance urban-urban grain trading movements, the use of transport animals, particularly donkeys and mules is very dominant, and relatively cost effective. On the other hand, urban to urban long distance grain marketing involving primarily major zonal, regional and capital market centers, dominantly medium and high capacity trucks are used by urban grain traders/merchants.

vi ) General Food Supply and Price Situation

At the time of the survey, a sharp grain price increase was observed in most food deficit sample areas (mainly in lowland and highland parts of North Shewa, parts of S. Wollo, most parts of North Wollo, and parts of Gayint in SouthGondar) reflecting a sharp marketable grain supply decline in local markets. Analysis of the survey information indicates that, a generally fast increasing price trend is a phenomenon often observed during the pre-harvest seasons and more importantly in periods of serious production shortfalls. Such increasing periodic price increases often depress the purchasing power of the low income groups. A serious cyclical grain supply decline occurs as a result of either poor harvest due to inadequate rains or ■

^ as a result of a total rain failure. In periods of serious harvest shortfalls, better-off peasants with some marketable grains and grain traders usually tend to hoard grains due to fear of the impending danger of serious food scarcity and price speculation respectively. " This information has an important policy implication in terms of strengthening early warning information and adopting timely food supply and price stabilization measures in food insecure and disaster- prone areas.

At the time of the survey, the general food supply situation in North Wollo was worse than the food situation reported for many areas in S. Wollo. A growing food crisis was observed and reported at all levels, in Woredas like Sequota, Bugna, Abergele, Ziquala, Kobo and in many food deficit Woredas of N. Wollo. This is due to the total and partial failure of mostly Meher rains followed by pest attacks in 1993. This year’s Belg rain has also generally failed which even further aggravated the food shortage/supply and price increases. Moreover, the survey information indicates that there had been a more consistent and serious production and food supply decline for the last one decade in most Woredas leading to a sharp price increases, more seriously in the northern, north-eastern and south-eastern parts of Wollo. The past 11 years overall grain price information from the survey areas also indicates that, there has been a general inflation of about 22 percent per year.

As regards the grain marketing costs in Wollo, many informants indicated that the use of transport animals by petty traders are relatively cost effective mainly for rural-rural and rural-urban short * and medium distance grain trading business. However, actual comparative transport cost studies on the use of transport animals and trucks is not known yet for grain marketing cost/unit by distance and type of road used. Such market information gap negatively affects policy decisions and interventions. This requires closer policy attention in terms of providing appropriate support for undertaking detailed study to reduce the existing information gap.

As regards grain trading across Abay (Blue Nile) river, an interesting traditional transport system is still being used. Human labour is markedly involved next to the use of work animals in transporting tradeable food grains across the risky river mainly until it reaches the relay markets in S. Wollo. This traditional marketing link across the difficult Abay gorge is another important area that requires a detailed study in order to facilitate appropriate marketing and development interventions.

vi i) Grain Supply and Price Stabilization

In sample food deficit areas in particular, petty traders relatively play an important role in stabilizing grain supply and prices in rural and secondary markets. In most local and secondary market centers visited consumers were observed buying food grains largely from petty traders and less from producers (non from big traders). On the other hand, in relatively grain surplus areas such as E. Gojjam, S. Gondar, and Wadla, Delanta and Dawnt Woredas in N. Wollo, consumers buy food grains largely direct from producers and very less/rarely from petty traders at local/secondary markets.

vi i Most respondents in food deficit areas indicated that, they did receive food relief assistance from different sources during the past crises periods. Some 88% of them also stressed that the relief food distributed during those crises periods stabilized both grain supply/availability and market prices in relative terms. The relatively moderate grain price increase observed in sample Woredas (in N. Wollo) that were more seriously affected by food shortages when compared to the sharp grain price increase observed in sample areas in S. Wollo confirms this information. At the time of the survey, a sharp grain price increase was observed in sample areas of S. Wollo where food shortage was not as severe as that observed in N. Wollo. The moderate price increase observed in N. Wollo is primarily due to the positive impact of the continuing food relief interventions by different relief agencies.

The survey findings suggest that, there is an urgent need for an appropriate government intervention in improving the marketing infrastructure within the food deficit areas and trading links between food grain surplus and deficit areas. This study has clearly demonstrated the role of relief intervention in stabilizing grain supply and prices in periods of growing food scarcity as a result of local production and/or supply shortfalls. Price stabilization is an important area of intervention for improving household purchasing power and food security. In order to stabilize food supply and market prices mainly in target areas vulnerable to periodic food supply shortfalls/crisis, policy measures may involve: (a) short and mid-term price regulation, (b) income support through subsidies and proper credit facilities, (c) grain sales at subsidized prices from reserves, (d) improving distribution system for free grain flow, and (e) improving rural market integration through opening access roads and market centers at strategic locations in currently isolated localities of many Woredas/Awrajas.

v i i i ) Major Grain Supply and Marketing Problems

The most chronic problems that still seriously affect periodic food grain distribution from potential sources to grain deficit areas include: inaccessibility/transportation and communication problems, production decline affecting the grain supply and market prices, declining purchasing power of consumers, sharp grain price increases in times of deepening food scarcity, and lack of capital for petty traders in order of importance. Transportation and communication problems are the most serious grain marketing constraints followed by a gradual decline of grain production and supply and people’s purchasing power.

3. SPECIFIC POLICY SUGGESTIONS

Despite some differences in the types and magnitude of the problems faced by the rural people in different geographical locations, the following are some specific policy suggestions in order to solve the major constraints commonly faced by the people in the survey areas in order of priority:

a) Serious policy attention should be given to establish key transport and communication networks at least up to major relay and secondary market centers. That is, there is an urgent need for people to get access to all-weather roads, market centers, and the need to establish new markets at strategic locations in order to promote marketable food grain distribution from supply sources to grain deficit areas. b) There is a need for grain market (food supply and price) stabilization and regulation policy support to communities in grain deficit areas, more importantly in periods of growing food shortages. This may involve the establishment of food reserves at strategic locations, provision of pricing support through subsidies for both food grain staples and productive inputs (eg, seeds, fertilizers, pesticides), controlling of illegal trading of food grain staples and productive inputs, and target of relief food distribution in times of stress, etc. Appropriate institutional market interventions to regulate or stabilize unfavorable market situation following the designed policy objectives have to be exercised as one of the priority measures of the government marketing agency, EGTE. In order for such institution to take proper measures to attain the actual objectives summarized under chapter two, strengthening the capacity of the institution itself at the appropriate levels is a pre-requisite. c) There is a high need for an improved institutional credit and marketing support. In particular, there is an urgent need for targeted financial and asset support- to improve the economic status and purchasing power of the poor. Appropriate support to the agricultural service cooperatives is one of the essential approaches for improving rural marketing and credit services to individual peasant households (and even to peasant petty traders). d) There is a need for policy support to improve the terms of trade between food grain and livestock producers, and between producers/sellers and consumers. Price regulation and/or relief food distribution to most needy areas are examples of important policy options that may be considered particularly in stress periods. e) Removing of existing local check points in some areas would also help in improving the grain supply and distribution into the local markets.

On the basis of the survey findings, the most critical problems of all that require urgent attention (intervention) by both the government and donor agencies include: (a) solving the prevailing marketing infrastructural problems (eg, provision of support in constructing motor— roads to avoid local isolation and improve market integration), (b) establishing food reserves at strategic locations particularly in food deficit and disaster-prone areas, and (c) providing support in the area of capacity strengthening for appropriate development institutions. Such positive intervention would not only solve food grain marketing problems; but it could also gradually solve/reduce many other inter-related short and longer term development problems, promoting food production and supply, household asset formation, employment or income generation and food security.

ix ACKNOWLEDGEMENTS

Many people showed a remarkable cooperation in providing the necessary information in the course of my information gathering effort at different levels. There are those, however, who deserve special mention, as without their genuine cooperation, advice and support this study would not have been completed. At the community-levels in Wollo and the adjacent administrative zones, a number of genuine village informants, executive committee members and leaders of each sample service cooperative and/or peasant association, petty traders, and urban traders/merchants participated in providing appropriate information without hesitation through formal and informal, group and individual approaches. I am very grateful to all of them.

I have received relevant constructive suggestions and cooperation from the staff members of a number of government offices at Woreda and zonal levels in the study areas of Region Three. Specially, I am very thankful to the staff members of the MOA zonal and Woreda offices, and the RRC staff at zonal offices. They have provided the required information through their genuine participation in group discussions conducted at different levels. I would like to thank also Ato Gebre-Meskel, general manager of EGTE for his remarkable cooperation in providing the current and past policy-related information relevant to this study.

I have also received very notable administrative support and cooperation from the staff of SCF-UK offices and its staff at all levels. Special thanks are due to Tayech, Shewaye, Tsedeku, Gebeyehu; and to NSP staff at Dessie branch office for all their invaluable cooperation and timely support in facilitating this study. Many thanks also to Mr. Julius Holt and Dr. Mark Lawrence for their constructive comments on the draft report and encouragement.

Dagnew Eshete October, 1994

x TABLE OK CONTENTS

Page

SUMMARY i ACKNOWLEDGEMENTS x ABBREVIATIONS xiii MAP OF THE STUDY AREA xiv

I. INTRODUCTION 1 1 . The Context and Aim of the Study 1 2. Organization of the Study 3 3. Sources of Information 3

II. GRAIN MARKETING EXPERIENCE 4 1. Grain Marketing Policy and Policy and Problems (Until 1991) 4 2. The Current Grain Marketing Policy 6

III. SURVEY METHODS AND PROCEDURES 8 1. Area Selection 8 2. Method of Data Collection 9

IV. BACKGROUND TO THE STUDY AREA 11 1. Geographical Features 11 2. Population, Settlement Patterns and Occupation 11 3. Land Use and Distribution 12 4. Agricultural Traditions by Agro-ecology 13 i) Major Crops Grown by Agro-ecology 13 ii) Meher and Belg Crop Production Activities 14 iii) Livestock Production by Agro-ecology 16 iv) Off-Farm/Non-Farm Economic Activities 17 v) Food Self-Sufficiency Periods/Months 18

V. GRAIN MARKETING AND HOUSEHOLD FOOD SECURITY IN WOLLO 22 1. Definition of Food Security 22 2. The Role of Grain Marketing in Ensuring Household Food Security 22

VI. THE SURVEY RESULTS 25 1. Food Deficit Areas in South and North Wollo 25 2. Major Sources of Marketable Grain Surplus Areas 26 i) Marketable Grain Surplus Areas in Wollo 26 ii) Marketable Grain Surplus Areas Outside Wollo 26 iii) Major Grain Staples by Agro-eco1ogical Locations 35 3. Actors in the Grain Trading Business 35 4. Mechanisms and Means of Grain Trading 38 5. Problems Affecting the Distribution of Marketable Food Grains 41 6. General Food Supply and Price Situation 41 7. General Grain Price Trends Since 1984/85 54 8. The Roles of Traders in Market Stabilization 62 9. Roles of Food Aid (Relief Food) in Market Stabilization 64 10. Socio-economic Impact of Differential Distances From the Main Road/Market Centres 65 11. The Main Sources of Cash Income 68

x i 12. Major Grain Supply and Marketing Problems 68 i) Grain Production and Supply Problems 71 ii) Grain Marketing Problems 72 iii) Improvement Suggestions 73 13. Institutional Grain Market/Price Stabilization Support 74

VII. CONCLUSIONS AND POLICY IMPLICATIONS 75 1. Production and Supply Problems 75 2. Grain Marketing and Household Food Security 76 3. Grain Marketing and Distribution Problems 77 4. Market Price Stabilization and Income Support 79 5. Specific Policy Suggestions 79

REFERENCES 82

APPENDICES 83

x i i ABBREVIATIONS

AAU Addis Ababa University AMC Agricultural Marketing Corporation EGTE Ethiopian Grain Trade Enterprise GOE Government of Ethiopia GPTF Grain Purchase Task Force IDR Institute of Development Research IFAD International Fund for Agricultural Development IFPRI International Food Policy Research Institute Km Kilo meters masl Meters above sea level MOA Ministry of Agriculture ONCCP Office of the National Committee for Central Planning NSP Nutrition Surveillance Programme PAs Peasant Associations RRC Relief and Rehabilitation Commission SCF Save the Children Fund SCs Service Cooperatives TGE Transitional Government of Ethiopia

Road t o ’ Kotcfco 1:

I. INTRODUCTION

1. The Context and Purpose of the Study

The Save the Children (UK) has been involved in famine early- warning information gathering in Ethiopia through its Nutritional Surveillance Programme since 1987. The project areas include the regular survey regions of: parts of Wollo and Tigray highlands; North Shewa; Wolaita in North Omo; and parts of Hararghe. On the basis of the recent revised project agreement with the Relief and Rehabilitation Commission (RRC), the SCF is moving into a broader field of food security information collection within the rural communities of the survey areas. The new approach emphasises on a broader socio-economic information gathering with primary emphasis on food security information in selected food insecure and disaster-prone localities or communities in order for SCF to play a broader advocacy role and facilitate targeted policy interventions. This revised approach requires a better understanding of household-level food production and supply, income and sources of income, distribution of income, and consumption situations in relatively normal times and during periods of food scarcity. The greater proportion of the communities within the aforementioned regular survey regions have experienced serious food shortages and famines in the recent decades; and many have also been dependent on food aid particularly since the 1984/85 drought-induced famine.

SCF (UK) carried out a baseline study on the 'rural economy’ of north-east Ethiopia in 1992. This study was planned 'not to estimate emergency requirements’ but rather to examine on how people live in relatively normal years (ie, when there is peace and adequate rain for normal agricultural operations). In order to offer a valuable comparative statement about the current poverty and progress, the 'fact finding’ survey on food economy did consider the essential questions of: "how are people living, and what are their chief constraints ?". Sample survey was the approach followed in order to properly answer these questions and to identify priority areas for interventions.

The survey on the food economy of the Ethiopian north-east highlands (Holt & Lawrence, 1993) has made a remarkable contribution in providing practical policy suggestions based on its survey findings. Some of its policy suggestions are currently being incorporated into the relief-development planning projects and programmes by some government and non-government agencies (including SCF-UK itself). However, some questions still remain not fully answered (eg, reasons for year-to-year continuing relief distribution in many areas, main constraints in inter-regional trade and possible solutions, etc.). For example, in the "Making Ends Meet ..." report (ibid), it is argued that parts of N. Wollo and larger parts of Tigray have a "year-on-year need for relief, because the shortfall in crop production cannot be met entirely via the market, either because of structural problems with the marketing system (transport difficulties,

1 etc.) or because of inadequate purchasing power". Such positive argument reflects the need for a more refined field-level information either to confirm or disprove it. According to the authors of the survey report referred to above (ibid), "a major shortcoming of the N.E. Highlands survey was the lack of information on the marketing of * cheaper’cereal around the survey area".

The main objectives of this study would therefore be: a) to help SCF (UK) refine its position on the need for food aid in the northern parts of the country, and to provide a basis for advocating on behalf of that position; b) to improve SCF’s early warning of impending food shortage and f amine; and c) to identify constraints to inter-regional trade and how these might be eased.

Taking the above objectives as a basis, this study would examine directly and indirectly related questions (problems) such as the nature and problems of rural grain production, grain distribution/ supply and marketing with an implication for household food security and policy. In particular, the current grain supply and marketing problems have been examined in detail in relation to its effect on local and household level food security by administrative zones focusing on the north and north-central region of Ethiopia - Region Three (see figure 1). A more detailed examination concentrates on particular food deficit areas (Woredas) of North and South Wollo Administrative zones. Most Woredas in these administrative zones are generally food deficit and have been facing recurrent disaster-induced food shortages and famines in the recent decades. Some Woredas within Wollo and in adjacent administrative zones (ie, bordering Wollo) which are expected to influence grain marketing in both North and South Wollo are also briefly covered by the survey. That is, this study has also attempted to identify the relatively marketable grain surplus areas (within and outside Wollo), where people in many grain deficit areas in Wollo depend for their food supply more importantly in bad years.

The field survey mainly focussed on the investigation of the following important questions: - chief sources of marketable food grain staples within and outside Wollo by Woreda and administrative zones (in both bad and good years/seasons); - types of grain staples preferred by the people in different agro-ecologies (grains bought and sold in local/urban markets) and direction of marketable grain flows; - mechanisms of trade and means of tradeable grain distribution; - analysis of the current food supply and price situation by types of food grains; - the types and roles of grain traders at all levels in: (a) the movement/distribution of marketable grains from relatively surplus to deficit areas, and (b) stabilizing food supply and market prices in periods of food scarcity; - causes/sources of marketable food supply shortages (including factors affecting market prices and food grain movements); and - aspects requiring urgent policy attention to facilitate production and marketing/distribution problems.

2 The nature of existing marketing institutions, integration of markets, and areas of government interventions are also among the many important questions examined during the fieldwork. For the summary of specific problems covered by the survey questionnaire, refer to append ix 1 .

The general information collected and the findings of this survey are expected to benefit not only in advancing SCF-UK’s understanding of the survey areas in order to play a broader advocacy role and to see possible areas of future project interventions, but also to facilitate the interventions of other user agencies (like RRC, MOA, EGTE and interested NGOs) in their relief, rehabilitation and development planning and implementation efforts.

2. Organization of the Report

The rest of the report is organized as follows. Chapter two gives an overview of the institutional grain marketing experience in Ethiopia, with particular focus on the past and present grain marketing policy and problems. Chapter three explains the detailed survey methods and procedures followed to gather the integrated micro-level information. Chapter four briefly examines the general and some specific socio-economic backgrounds of the study area. This includes the geographical features, population and settlement patterns, occupation, land use and distribution, and agricultural traditions by geographical location/agro-ecology of the study areas. Chapter five examines the contribution of grain marketing in ensuring ' household food security in Wollo. This chapter also includes the definition of food security. Chapter six discusses the survey results in detail. This includes some improvement suggestions provided by sample respondents. Chapter seven summarizes the main findings of the study and discuss their implications for household food security and policy.

3. Sources of Information

The information used in this study were gathered primarily from primary sources through field-research work in sample areas of Wollo and adjacent administrative zones. The principal source of information has been sample survey involving mainly questionnaire-based group discussions with the staff members of Service Cooperatives/Peasant Associations (SCs/PAs), key village informants, Ministry of Agriculture (MOA), Relief and Rehabilitation (RRC), rural petty traders and urban traders at different levels. This also included direct market observations and use of official market records from MOA and RRC offices. Some secondary information mainly unpublished periodic reports and official records were also gathered from MOA and RRC offices despite its inadequacy and problem of data quality.

3 II. GRAIN MARKETING EXPERIENCE

1. Grain Marketing Policy and Problems (Until 1991)

Available literature (Alemayehu, 1987; Webb and Others, 1992) notes that government intervention in grain marketing and pricing pre-1975 was very limited. Inadequate attempts were made to participate in grain marketing and pricing activities through establishing government organizations like the Ethiopian Grain Board in the 1950s which was later replaced by the Ethiopian Grain Corporation in the 1960s. These agencies were organized with the objective of regulating grain prices, hold grain reserves, and for controlling grain quality for export needs and provide necessary market infoi'mation. However, they failed to meet the objectives mainly because of lack of adequate government support in funds and pricing policy. These agencies were unable to effectively protect farm producers from the exploitation of grain merchants due to the inefficient marketing system that prevailed. By 1975 private traders (in urban and rural areas) were controlling over 90 percent of the grain marketing system.

A growing government intervention in grain marketing took place during the military regime, post-1975 by establishing a government agency, Agricultural Marketing Corporation (AMC). This newly v structured agency absorbed all functions of the former Ethiopian Grain Corporation. In the initial years of its establishment (late 1970s), AMC was entrusted with several responsibilities, including: (a) purchasing of agricultural products from local and foreign sources; (b) purchasing and selling of farm inputs; (c) exporting of food grains and selling of the same for domestic consumers; and (d) maintaining of national grain reserve.

As regards grain pricing, three forms of ineffective (unfavorable) grain price policies for producers and consumers were designed by the government between 1975/76 and 1980/81. Although attempts were made to adopt regional pricing system (fixing producers and consumers price by regions), it failed to be effective for the following major reasons: (a) the fixed wholesale and retail prices of regional central markets (covering a radius of 250 km), and the prices of subsidiary markets determined by adding transport costs remained higher than the free market prices during harvest periods, resulting in unfavorable producer prices and terms of trade between peasants living in remote localities and peasants living closer to central markets; (b) the regional policy (pricing system) did not adequately consider the provision of market price-induced production incentives to farmers (eg, failure to see the significant inter-regional cost of production differentials that leads to significant variations of producer prices by crops); (c) The difficulty of applying different prices for the same grain types in two adjacent regions in which producers live close to each other but receiving different pricing decisions by their respective regions;

4 (d) Lack of knowledge of regional policy makers, Grain purchase Task Force (GPTF) in particular, about world market prices for export crops (eg, pulses and oil crops). Fixed producer prices for food grains and cash crops were maintained without considering changes in the international markets.

Hence, because of these limitations, the regional pricing system (policy) was replaced by a more centrally fixed and uniform producer pricing system in 1980. That is, a nation-wide structure that fixes uniform levels for both wholesale and retail prices was established. Official prices established in 1980 remained largely unchanged until the declaration of the 1990 economic liberalization policy. Such grain marketing and pricing in Ethiopia was operational for one decade, AMC being the implementing agency with the following objectives: - stabilization of grain prices for producers and consumers; - encouraging grain production through better producer price incentives; and - ensuring an adequate food supply for the public distribution system.

To implement these policy objectives, AMC had adopted three major grain marketing strategies, which include: (a) the planned purchases and quota delivery scheme; (b) fixed and uniform producer pricing; and (c) controlling of the private grain trade with an increase in the role of public sector (mainly rural and urban service cooperatives). These centrally designed strategies were implemented at regional and sub-regional levels in the country until the previous government declared for a "mixed economic policy" in 1990, with a relatively liberalized market economic policy (banning at least the quota system). Some of the previous government’s approaches towards securing urban grain supplies was the formation of the quota delivery system and the curtailment of private grain trading.

In the latter one decade’s operation of AMC, the quota purchase scheme, and fixed and uniform pricing approaches were used as the main grain marketing strategies at the expense of rural accumulation, consumption and rural incomes. The strategies were implemented at the expense of producers’ income and general livelihoods. That is, producers’ incentives were largely undermined by keeping farm-gate prices far lower than annually growing costs of production by crop types (disregarding costs of production, discouraging grain production). Different forms of producers’ reactions to quota deliveries and fixed prices were shown (eg, delivery of non-quality grains with impurities, substitution of certain high value cereal crops like 'tef' and wheat by inferior crops not demanded by AMC). The restriction on private trade and creation of check points in various regions (constraining the free distribution of food grains to deficit or needy areas) also resulted in various forms of illegal grain movements and trading. The quota administration and control of private grain trade (including control of intra- and inter-regional free movement of trade by individuals through check points) had also aggravated food shortages in many of the food deficit localities and towns (with the exception of major towns/cities). 2. The Current Grain Marketing Policy

The centrally planned/controlled grain marketing and the socialization of economic policy at large experienced for nearly 17 years under the previous regime totally discontinued as a result of the 1991 political change. AMC remained with unclearly defined scope and role until the 19th December 1992. Following the new economic policy (free market economy) of the Transitional Government of Ethiopia, the former AMC has been restructured. That is, a new marketing agency, entitled as the Ethiopian Grain Trade Enterprise (EGTE) has been established (replacing AMC) by the Proclamation No. 104/1992. According to thisProclamation, the Enterprise was established for the following objectives: - to stabilize markets and prices to farm producers to encourage them to increase their outputs; - to stabilize grain prices and markets to protect consumers from unfair grain price increase; - to export grains to the world market to generate foreign exchange when necessary; - to maintain grain buffer stock for market stabilization; and - to engage in any other related activity (eg, input supply) for the attainment of its objectives.

According to Gebre-Meskel Dessalegn* , the general manager of the newly established Enterprise, the new 'free market policy’ provides incentives to both producers and grain traders. In particular, private traders are expected to play the biggest role in the grain marketing business. As regards the market share, about 90% of the marketable surplus of grain would be handled by private traders, while the Enterprise will be handling up to 10% of the marketable surplus. The biggest roles of the Enterprise would be market and consumers’ price stabilization (market regulation) among the many objectives listed above. Holding food security reserve (buffer stock) would be its other important activity. To implement these objectives, the Enterprise will have a head office (in Addis Ababa), branch offices and purchase sites; and would focus on primary and secondary market centres.

1 Questionnaire-based discussion held at the office of the Ethiopian Grain Trade Enterprise, Addis Ababa, 9th May 1994.

6 7

.c.3 « d .REGION i .'(TIGRAY) Figure 2: MAP SHOWING THE MARKETABLE GRAIN X '. V SURPLUS PRODUCING AND FOOD DEFICIT AREAS IN S < THE MAIN AND SECONDARY SURVEY AREAS llur.cra y >'?) ^ . - X .• 0Ociv»rli]* «

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LEGEND:

f-fc- Surplus Marketable Grain Producing Areas O ”* E lrio n A- IKT Moderate (Generally -) mrVoo~ Grain Deficit) Areas ’/fL-n.25S — '' ■* >— silv. 'jkiz itoim i rjucw* Chronically Food Deficit and Drought-Prone Areas • R oa d .to Addlo’ Abftb* Regional Boundary

Road "ti Zonal Boundary . Add la Abab£ All-Weather Road REGION (OROMIA) 'REGION 14-^ Major Towns (ADDIS ABABA) CD Other T o w a f

Ill . SURVEY METHODS AND PROCEDURES

1. Area Selection

The main survey area selected covers Wollo region, one of the project areas of SCF-UK. The core survey areas include grain deficit and grain surplus producing purposively selected Woredas. The other survey areas where a relatively less intensive survey was undertaken include purposively selected Woredas that are assumed to have strong traditional grain trading links with Wollo region. The secondary survey areas adjacent to Wollo include North Shewa, South Gondar, and East Gojjam administrative zones (see figure 1 for details). These secondary survey areas were considered in order to cross-check the agricultural marketing information to be gathered in the main survey sample areas in Wollo.

Given the variations in the natural endowments, settlement patterns, agricultural and other market-based economic activities, established development infrastructures and other socio-economic and communication problems, it was found to be appropriate to stratify sample areas by: - geographical locations (eg, administrative zones and Woredas); - agro-ecologies; - marketable grain surplus producing Woredas and food deficit Woredas; and - distance from towns, market centres and roads.

The main survey area is divided into two administrative zones, namely North and South Wollo (see figure 2). South Wollo comprises 20 Woredas of which 6 (30%) of them are grain surplus producing Woredas. The rest are generally food deficit Woredas prone to the recurring drought-induced food shortages. North Wollo, on the other hand, comprises 13 Woredas of which 3 (23%) Woredas are relatively grain surplus (or at least self-sufficient in food production). The other ten Woredas are generally vulnerable to the recurrent drought induced food shortages/famines.

The other purposively selected secondary sample survey areas adjacent to Wollo region (see figure 2) traditionally having strong links primarily in grain marketing, and which are often considered as marketable grain supply sources to many 1ocal/secondary and primary market centres in Wollo include: - Dera, Woremo Wajitu, Kewot, and Efrata and Timuga Woredas in North Shewa; - Parts of Lay- and Tach-Gayint, Simada, Farta and Estae Woredas in South Gondar; and - iiulet Eju-Enesie, Enesie Sarmidir and Shebel Berenta in East Goj jam. Besides, representative sample agricultural service cooperatives ( SCs ) each comprising at least three peasant associations (PAs) within each sample Woreda were also selected purposively stratified by agro-ecological differences. Stratified area sampling was applied because of the existing variability between SCs or PAs within Woredas in their agro-ecologies. Agro-ecological variations affect the rural

8 seasonal economic activities (eg, traditional system of food production, distribution and consumption), food supply shortages and coping mechanisms, and the general way of life. SCs/PAs were chosen as samples to serve as sources of rural marketing information because members of these rural institutions (peasant households) are on one hand producers, and sellers as producers and petty traders; and on the other hand, the majority of them are consumers/buyers for more than six months of the year.

2. Method of Data Collection

Earlier, we indicated the important questions included in the unstructured (open-ended) questionnaires used for the survey at different levels within sample areas. Different formal and informal approaches were used in the process of data collection in order to attain the research objective. The following were the main sources of information for the study (in order of importance): - SCs/PAs comprising some peasant or petty traders within them as members) ; - agricultural extension and marketing development agencies (eg, MOA and AMC) at different levels (including zonal RRC offices); - legal grain traders (middle-level and merchant traders) primarily operating in major market centres - with few exceptions that operate in few secondary markets; - key informants (in rural and urban areas); - official records on weekly/monthly grain prices for selected market centres; - published and unpublished documents; and - direct market observations to assess current grain and livestock supply and price situations within sample areas.

Data for the study was collected using the following specific techniques: (a) Group Interview: This method of data collection was undertaken at all levels (regional, zonal, Woreda, and SC/PA levels) with the exception of legal traders/merchants and some key informants where discussions were held with individual interviewees. Group questionnaire-based interview and extensive discussions with agricultural marketing and extension staff, heads of MOA, RRC and AMC staff, SC/PA members and leaders, and key village elders was carried-out at all respective levels. Interview-based discussions relate to the questions outlined earlier as may be appropriate. (b) Key Informants: Key informants at different levels were interviewed to supplement and/or cross-check the information gathered through group interview method. (c) Direct Market Observation: This method was applied for market data collection (ie, to observe the food supply and price situations) at sample market centres. The approach involves assessment of both current grain and livestock supply and price situations. This is accomplished by considering average prices by grain and livestock types in each observation from an average of 5 sample sellers by commodity in each observation market centre. A total of 8 major and secondary market centres were visited during the survey period. (d) Use of Records: Official weekly/monthly records on grain and livestock prices have been gathered from concerned agencies (eg, MOA, RRC). Official information on the prices of major grain staples

9 collected on weekly/monthly basis was found in many sample MOA offices and zonal RRC offices (though data collected by some offices is incomplete or partially available). However, such data collection by most sample offices has been practised for not more than a maximum of 6 months. Additionally, some offices also undertake weekly/monthly livestock supply and price observations at local market centres (eg, Bati, Guba Lafto). However, non of the offices visited were found collecting information on the volume of grain and livestock numbers marketed (commodity movements) in each market observed regularly. (e) Other Secondary Information Sources: Information from other sources such as published and unpublished documents has also been utilized (to be used primarily as a background information source for the report.

Hence inquiries made in the respective levels/stages specified above within each sample area were made using the questions outlined in appendix 1 to attain the survey objectives. The survey questionnaires primarily focus on the assessment of grain marketing situation (identifying sources of marketable grain and grain deficit areas, direction of marketable grain flow, mechanism of grain distribution, means of transportation, current grain supply and price situation, actors in the grain trading business, etc.). Although chapters four and five (below) are generally presented based on the survey information, the detailed survey results by sample administrative zones stratified by many sub-sample Woredas and agro-ecologies are discussed in chapter six. IV. BACKGROUND TO THE STUDY AREA (WOLLO)

1 . Geographical Features

Wollo is one of the northern regions of Ethiopia. Specific boundaries include: Tigray in the North, Afar in the East, North Shewa in the South, East Gojjam in the southwest, North and South Gondar in the northwestern parts of Wollo. The current total land area of both South and North Wollo administrative zones (after the recent regionalization measures) is estimated to be 4.0 million hectares. Of this, 54 percent of the total land area is covered by South Wollo administrative zone. The topography of South Wollo is 60% mountainous, 10% hilly, 20% plain, 10% gully (degraded land) and 1% high mountain frost (Wurch) areas. The topography of North Wollo is also 38% mountainous, 29% plain, 30% hilly, gullies and degraded/rugged areas, and 3% other non-arable land covered by marshes, water and "Wurch" areas. Although the larger proportion (over 70%) of the land area in both South and North Wollo is not suitable for crop production topographically, the climate is generally suitable for varying crop and animal farming activities. Most areas of North Wollo and parts of South Wollo, however, have experienced the problem of recurring drought and serious food crises in the recent two decades affecting both human and animal lives. The average rainfall in South Wollo ranges from 500-700 mm; while it is about 600 mm in North Wollo. The altitude varies from 500-3500 masl and to nearly 4000 masl in North and South Wollo respectively. Like in other regions in Ethiopia, rural areas are often characterized by three major agro-ecological (climatic) zones such as Dega (high altitudes above 2500 masl), Woina-Dega (intermediate zones 1500-2500 masl), and Kolia (lowlands below 1500 masl). Agro-ecologically, South Wollo is 32% Dega, 45% Woina-Dega, and 22% Kolia. In North Wollo, 15% is Dega, 43% Woina-Dega, and 46% Kolia climatic zone.

2 . Population. Settlement Patterns and Occupation

The current population of Wollo (MOA, 1994) is estimated to be 3.9 million. Of this, 56.4% of the population live in South Wollo. The estimated family size is 8 and 3.2 in the South and North Wollo administrative zones respectively (with an overall average family size of 5.6 persons). One of the many possible reasons for larger (growing) family sizes in South Wollo could be the polygamous marriage system still practised by the Islamic society (the dominant population) when compared with the monogamous, dominantly Orthodox Christians in North Wo 1lo.

About 95% of the total population of North and South Wollo live in the rural areas. Two-third (67%) of the population live in the highland plateau (Dega and Woina-Dega areas), and the rest live in the eastern lowlands and associated valley plains between highlands of the

11 region . The settlement pattern of North Wollo (for which data is available) indicates that 23%, 33% and 44% live in Dega, Woina-Dega and Kolia areas respectively. The occupation of about 90% of the rural population in Wollo is mixed subsistence farming. Although data for detailed existing occupational situation of South Wollo is not available, the information in table 1 for North Wollo generally reflects the prevailing situation in South Wollo as well. The occupation of the people living in the two administrative zones does not significantly differ despite the existing marked occupational variations between different agro-ecologies.

Table 1: Occupation of Rural Population (North Wollo)

SI.No. Occupation Percent Remark

1 Mixed farming 89.4 2 Crop farming only 4.2 3 Livestock farming only 1 . 4 4 Farm labour (casual)* 2.0 ♦within localities 5 Petty trade 1.5 and adjacent 6 Cottage industry/handicrafts 1.0 areas (including distant areas through temporary migrat ion) 7 Daily labour (in towns)** 0.5 **through temporary 1 | migration to towns ______i______i______l Source: Zonal MOA office, Woldiya (March 1994).

3. Land Use and Distribution

Of the total land area of Wollo, an estimated average of 25 percent is arable and 9 percent grazing land. The general land use pattern for South and North Wollo administrative zones is indicated in table 2 below. Various information sources indicate that there had been a fast decline in the farmland holding/distribution per household in more recent years due to increasing population pressure as a result of: (a) uncontrolled population growth rate, and (b) high influx of returnees from distant old resettlement areas of southwestern regions of the country (destabilized by the recent ethnic conflicts) and the ex-military members of the previous regime. The current land holding per household is 0.5 and 0.87 ha. in the South and North Wollo respectively (ranging from a minimum of 0.25 ha. to a maximum of 1.0 ha/household). The experience in North Wollo shows that, of the annually total cultivated land in relatively good years, an estimated average of 79%, 18% and 3% is used for cereals, pulses and oil crop production (MOA, 1993). The experience of South Wollo in terms of cultivated land use practices does not significantly differ from that indicated for North Wollo. Because of the over population pressure

2 'Region’ in this context refers to a geographical region.

12 resulting serious farmland shortages coupled by the rugged and degraded topography of the region, most farmers are forced to cultivate very steepy hills and mountain sides.

Table 2: The Land Use Patterns in South and North Wollo

Land Use South Wollo North Wollo Remark Size Ha X Size Ha X

1. Arable land 450,000 21 536,279 29 2. Grazing land 270,800 13 90,006 5 ♦Others include 3. Forest 74,000 4 57 ,099 3 land covered 4. Bushes and by mountains, shrubs 25,000 1 605,373 33 hills, marshes, 5. Others* 1,300,200 61 553 ,576 30 water, gullies, villages, etc.

Source: MOA offices at Dessie and Woldiya, 1994.

4. Agricultural Traditions by Agro-ecology

i) Major Crops Grown by Agro-ecology

In Wollo and in the country at large, the agricultural activities (traditions) vary according to the altitudinal/agro-ecological variations. For example, the types of crops that dominantly grow in Dega (eg, barley and horse beans) do not grow in Kolia areas. Crops such as sorghum and maize, on the other hand, do not grow in Dega climatic zones. Woina-Dega areas generally accommodate diverse crops that grow both in Dega and Kolia agro-ecologies. This also holds true for livestock husbandry by types and breeds. Details of specific crops grown by agro-ecology (in order of importance) are shown in table 3 below.

Table 3: Crops Grown by Agro-ecology

Agro-ecology Crop Types

1 . Dega Barley, Horse bean, Lentile s , Field peas, and Oats 2. Wo ina-Dega Tef, Whea t, Barley, Maize, Horse bean, Field pea s , Sorghum , Chick peas , Oil crops, and Vetch 3. Kol la Sorghum, Tef, Maize , Chick peas , and Oil crops

Source: Survey data (Dagnew, 1994)

13 ii) Meher and Belg Crop Production Activities

Farm producers in parts of Wollo and in the country at large depend on two rainy seasons for their crop production activities. These are: (a) the Meher seasonwhich largely depends on the rainy (Kremt) season extending from May/June to September; and (b) Belg season which depends on a short rainy season generally extending from Feb./March to early May. Some Meher long-maturing crops such as sorghum and maize also benefit from the late Belg rains (April-May) for planting and early stage growth. In Most Dega areas (high altitudes) Belg rains start in mid-January and last in early May. In warmer Woina-Dega areas, Belg rains often start in late February and ends in early May. Kolia areas (below 1500 masl ) are not generally users of Belg rains due to its erratic nature. However, little rains that fall in Kolia areas are useful for regeneration of pasture for livestock. About 48 percent of the Woredas in Wollo benefit from the Belg rains (at least partially) in relatively normal years. Of these, nearly 63 percent of the Woredas that benefit from the Belg rains are located in South Wollo.

The overall annual contribution of Belg crop production ranges from 15 to 25 percent in relatively normal years. Belg production contributes 20-25 and 15 percent of the total annually expected harvests in South and North Wollo respectively. In some particular Woredas in South Wollo (eg, Dessie Zuria, Kuta-Ber, Legambo and Tenta) and North Shewa (eg, Geramidir, Kewot, Efrata and Timuga Woredas), the annual contribution of Belg crop harvest ranges 40-65 percent of the total annual production harvest. In few exceptional Weredas like Dessie Zuria, Kuta-Ber and parts of Legambo (in South Wollo) and Geramidir (in North Shewa), the Belg crop contributes 60-65 percent of the total annual production harvests. With the exception of long maturing crops (mainly sorghum and maize), all other cereal crops and pulses can be grown using Belg rains. However, barley appears to be the most dominant Belg crop in Dega and Woina-Dega agro-ecologies followed by wheat, horse beans, lentiles and field peas. In Woina-Dega areas, other crops like Tef (Eragrastis te f) is also grown using Belg rains as one of the secondary crops. In some parts of Belg crop growing Dega or cooler highlands, Meher crop growing (ie, double cropping is not possible due to the problems of water-logging, frost and unfavorable (very cool) temperature for crop germination and proper growth. In many areas where both Belg and Meher crop production is possible annually, the overlappings of the two seasons’ peak cropping activities (eg, peak harvesting time of Belg crop overlapping with planting time of Meher crops) and labour shortages are also among many other important production problems. For details of Belg vs Meher crops in terms of their annual contributions, planting/sowing and harvest seasons by administrative zones and Woredas refer to table 4. Table 4: Contribution of Belg crop production (out of the total annua/ production) compared with ti w M e h e r c ro p production at Woreda and zonal levels

Woredas by % Contribution Planting/Sowing Harvesting Season

Administrative Seasons

Zones Belg M e h e r Belg M e h e r Belg M e h e r

1. SOUTH WOLLO: 20-25 75-80 Mid Jan. - Mid March April M id Aug. Lmte M ay-M ed July N ov.-M id Jan.

Saint 15-20 80-35 Late Jan. - Mid March April Early Aug. June - July Nov. M id Jan.

Legambo 40 60 Early Jan. - Early Marc April Early Aug. Late May • Early July Nov. M id Jan.

Tenta 30-40 60-70 Early Feb. - Mid March April Mid Aug. June - July Nov. Mid Jan.

Debre Slna 25 75 15 Jan. - Early March April Mid Aug. Late May - Early July Oct Late Jan.

Jamm a - 100 - April M id Aug _ Nov. Doc.

Kuta-Ber 60 40 Early Feb. - Mid March April Mid Aug. June - July Nov. Dec.

Worebabo 5-10 90-95 Late Fob. - Late March April Early Aug. Juno • Early July O c t Doc.

Esayo-Gola - 100 - April July - Oct. Dec.

Batl 2-3 97-98 Lato Fob. - Lato March April Early July Juno • Early July O c t Doc.

2. NORTH WOLLO 15 85 Late Fob. - Late March April Early Aug. June - Early July Nov. Early Jan.

Guba-Laffo 10-15 85-90 Lato Fob. - Late March April Early Aug. Juno - Early July Nov. Doc.

Soquota - 100 - April July - Nov. Doc.

Bugna 5 -7 93-95 Lato Fob. - Lato March April Early Aug. Juno - Early July Nov. Doc.

Wadla Dawnt 23 77 Lato Feb. - Lato M arch April Aug. Juno - M id July Nov. Early Jan.

Meket 1-6 94-99 Late Feb. - Lato March April Early Aug. Juno - M id July Nov. Doc.

3. N O R TH SHEWA 25 75 Mid Feb. - Mid March April Aug. Juno - July Oct. Jan.

Geram idir 65 35 M id Fob. - M id M arch April Aug. June - July Nov. Early Jan.

Lay-Bet - 100 - April July - Nov. Doc.

Dera - 100 - April Early Aug. - Nov. Doc.

K ew ot 40 60 M id Feb. - M id M arch April Aug. Juno - July Nov. Doc.

Efrata & Tlmuga 3 0 70 M id Feb. - M id M arch April Aug. Juno - July Nov. Doc.

4. EASTERN GOJJAM - 100 - April Early Sept.* - Nov. Doc.

(all sample woredas)

5. SOUTH GONDAR - 100 - April Sept.* - Nov. - Doc.

(all sample woredas)

NOTE: Crops In Kolia agro-ocologloa are oft on harvested October-mid December (relatively harvested earlier than In

Doga aroas). •Chick peaa and some early masurlng baroly varieties aro plantod late In tho krom t seasom

(particularly In areas with black clay soils that often lace water logging problems In the middle of the heavy

rainy period). Such crops are able to grow using relalnod-soll moisture In the early weeks of post-Kremt season.

SOURCE: Survey data (Dagnow,1994).

15 iii) Livestock Production by Agro-ecology

Livestock in Wollo, as in most other regions in the country, play a significant role in the regional economy and in ensuring household-level food security. Animal rearing is a common traditional practice by farm households in all agro-ecologies of South and North Wollo. Livestock are generally secondary or supplementary sources of food security (next to crop husbandry) in Dega and Woina-Dega areas; and complementary and primary sources of food security in Kolia agro-pastoral and pastoral areas respectively. Livestock husbandry in particular becomes an equal and/or primary source of food security in Kolia areas.

Although a record on the livestock population (at a household and regional level) is not available, information from MOA offices and peasant informants indicated that there is a large number of livestock population mainly in the Kolia and Dega agro-ecologies of South and N. Wollo. It was also indicated that S. Wollo has a better livestock resource potential particularly in many Kolia and Dega areas compared to the most degraded and rugged areas of N. Wollo. The livestock and other natural resources in N. Wollo have been sharply declining due to the past repeated devastating droughts. Despite the severe experiences people faced in the recent decades in N. Wollo, people in some lowland Woredas such as Ziquala, Abergele and parts of adjacent Woredas are still more dependent on their livestock as a primary source of food security. That is, people living in these areas are generally agro-pastoralists, using crop farming as a secondary source of their food security.

In the Dega and Woina-Dega areas of South and N. Wollo (such as in Wadla Dawnt, Delanta, Meket, Wore-Ilu, Jamma, Legambo, etc. Woredas), sheep, cattle and equine are very dominant animals in order of importance. In Kolia (pastoral and agro-pastoral) areas, cattle, goats, camels and sheep are also common animals (major sources of food security) in order of importance. Livestock possession in Wollo (regardless of their agro-ecological locations) are not only direct sources of household food security; but also sources of power (eg, draught power), means of transportation (as pack animals), and as an important source of cash. Specially, oxen are the most important source of draught power; while equines (primarily mules, donkeys and horses) are the most important means of rural-rural and rural-urban transportation. In Wollo, 96 percent of the draught power sources are oxen. The rest (4%) of the power source comes through the paired use of a horse and an ox and/or using horses’ power. Sheep and goats are generally kept for market (cash) and meat in most agro-ecologies. Camels are most common in a more drier (pastoral) kolla areas of eastern Wollo (such as in parts of Kobo, Gubalafto, Worebabo, Bati, Artuma and Deway-Rahmedo) bordering the Afar region. They are important sources of food (meat and milk) and means of transport in most harsh areas and distant places.

In most places, however, the livestock numbers and their productivity are said to be alarmingly declining from year to year due to rapidly diminishing common grazing lands, overstocking, scarcity of pasture and poor watering and veterinary facilities. The livestock population pressure/overstocking is also an important cause for the

16 growing soil erosion and degradation in many parts of Wollo and in the country at large. This is one of the many sub-sectors that requires an urgent policy attention.

Despite the serious food insecurity problem that has been prevailing among the livestock owners in many parts of Wollo, livestock marketing has never been governed by natural market demand and supply (but not driven by market demand for their animals). Rather, livestock (regardless of their size) are sold by peasants when their demand for cash is high in order to ensure their family food security (for food purchase) in times of stress. In most cases, they are forced to sell their animals in greater number when faced with deepening crisis to avoid (if not to minimize) losses.

iv) Off-Farm/Non-Farm Economic Activities

As indicated earlier, the dominant economic (income) source for over 95% of the people in Wollo is Agriculture. Other subsidiary economic activities, often termed as off-farm (non-farm) income generating activities rural people (particularly the low income group) have been involved for decades include petty trading, selling family labour, weaving, pottery-making, blacksmithing, sales of wood and charcoal, and handcrafting (eg, Bana making from sheep hair). In more recent years, because of the increasing population pressure caused mainly by the influx of settlers (coming from the dissolved old resettlement areas in the southwestern parts of the country), ex-soldiers and a growing unregistered new households, the key productive resources such as land have been getting more and more scarce leading to the annually declining family food production, food supply and growing food insecurity. The number of landless and near-landless rural people have increased, gradually leading to a rural unemployment problem. As a result of the seriously declining productive resource ownership constraints coupled by the recurrent drought-induced food insecurity, many peasants primarily in chronically food deficit areas make growing efforts to diversify possible subsidiary off-farm income sources referred to above as a coping mechanism.

Of the many growing additional income generating off-farm activities, petty trading, selling family labour (locally and/or through temporary rural-rural and rural-urban migration), collection and sales of wood and charcoal are the dominant ones (in order of importance). The growing rural unfavorable situations are likely to foster more migration mostly into urban centres within and outside Wollo which may lead to further urban unemployment crisis. Survey information indicates that the growing non-farm income generating activities referred to above are largely undertaken by the poor followed by the middle income groups. Such activities are mostly undertaken during the slack periods or days.

'Bana’ is a hand-woven traditional cloth (mainly blanket) from sheep hair by highland sheep producers.

17 v) Food Self-Sufficiency Periods/Months

The traditional agricultural practices that prevailed for centuries still remain unchanged. Peasants still use both inadequate and traditional farm technologies as regards to farm tools, seasonal productive inputs, farm power and other farming practices. The agricultural extension services are also very poor, and many areas particularly with poor rural road facilities have not been reached at all. Agricultural production and productivities in Wollo like in other regions in Ethiopia have also been constrained for generations by: (a) a growing population pressure and productive asset (eg, land, oxen, farm tools) shortages, (b) infestation of crop by pests and diseases, (c) livestock disease, (d) lack of improved agricultural inputs, marketing and credit incentives, (e) lack of farmland ownership right and the problem of yearly re-allocation of the already diminished farm plots to new in-migrants and adult children which seriously affects local conservation work and investments; and (f) unpredictable weather changes and gradual soil degradation. The survey information shows that an overall average of 46% and 36% of the farm households in North Wollo are oxenless and with one ox only respectively.

These chronic and growing rural production problems coupled by the long civil conflict or instability that prevailed until very recent years have resulted to a fast decline in the yield/unit, annual farm production and incomes. Such complex problems have led the majority of the rural people to a vicious circle of poverty and vulnerability to seasonal food insecurity. Moreover, as a result of farm asset decline and lack of reserves, the majority of the rural people are becoming vulnerable to the recurrent disaster (mainly drought)-induced food crisis that has increasingly become a common phenomena primarily since early 1970s. This clearly indicates that there has been a growing gap between the food requirement of the people and food supply. Although records are not available, representatives of peasants in most survey areas stressed that food production and supply situation is far below the food requirement at a household, local and zonal levels.

Table 5 shows the food self-sufficiency periods (in months) in relatively normal years disaggregated by different income categories, agro-ecologies, and by sample Woredas in Wollo and adjacent administrative zones. Analysis of the information in this table reveals that the overall average household-level food self-sufficiency periods in food deficit sample Woredas are about 3, 5 and 9 months for the poor, middle and the rich respectively in normal years. That is, the overall food self-sufficiency months by income groups in food deficit areas is about 29%, 50% and 79% for the poor, middle and rich income groups respectively in relatively normal years. The same information indicates that approximately 50 and 40 percent of the population in these Woredas are from the poor and middle income categories respectively. In the recent decade (normal years), grain production in these areas has been estimated to cover only up to 50-

Annual average net grain requirement for consumption may range 9-12 Qt/household.

18 60% of their total annual food needs due to complex production problems.

Table 5: Food Self-Sufficiency Periods (in months) in Normal Years by Different Income Categories in Sample Woredas

Self-Sufficiency Months Administrative Woreda Agro-ecology by Major income Groups Zones ------Poo r Middle Riel

Sayint Kolia up to 3 6 8 Dega-W/Dega 4-5 6-8 8- 12 Debre- Kol 1 a up to 4 7 12 Sina Dega-W/Dega up to 4 8 >12 Jama Overall 4-5 8-10 Average Legambo Dega 4-5 6-8 12 W/Dega up to 3 6 12

Tenta Overall up to 3 6 12 Average Bat i Kolia 1-3 4-6 7-9 Esaye- Kolia 3-6 8-12 >12 Gola Kuta-Ber Kolia up to 3 4-6 8 Dega-W/Dega up to 3 6 8- 12 Worebabo Overal1 up to 3 6 8- 12

2. North Wollo Gubalafto Overall up to 3 5 8 Average Sequota Overall up to 2 5 7 Average Bugna Overall up to 2 5-7 8-12 Average Wadla- Overall 5-7 7-11 >12 Dawnt Average Meket Overall 2-3 4 12 Average

Shewa Geramidir Overall up to 5 8 12 Average Lay-Bet Overall 3 6 12 Average Kewot Overall 3-6 7-8 12 Average Efrata & Kolia up to 3 4-6 9 Timuga Dega-W/Dega 4-6 9 12 Dera Overal1 3-4 7 >12 Average

4. East Gojjam Shebel- Overall 6 10 >12 Berenta Average Enesie- Overall up to 3 5-6 >12 Sarmidir Average

19 Hulet-Eju Overall 7 10 >12 Enesie Average

5. South Gondar Lay-Gayint Overall up to 3 6 8-12 Average

Note: The information given for Lay-Gayint generally applies for other Woredas of the former Gayint Awraja.

Source: Survey data (Dagnew, 1994).

In relatively surplus grain producing sample Woredas, the average food self-sufficiency months are about 5 and 9 for the poor and middle income groups respectively, and over 12 months (with adequate reserves or marketable surplus) for the rich in normal years. In these areas, approximately 30-35 and 40 percent of the population are from the poor and middle income categories respectively. In normal years, the marketable grain surplus produced in these Woredas supplies mainly the food deficit parts of adjacent Woredas in the respective Administrative Zones in Wollo.

Although there is variation between seasons, the survey information indicates that an overall estimated average of 20 percent of the total annual food grain requirement in Wollo in the recent relatively normal years had been satisfied through regional importation mainly from N. Shewa, E. Gojjam and S. Gondar. That is, considering the current population size of 3.9 million and an average family size of 5.6 persons, an estimated average of 140400 MT of food grain is regionally imported into Wollo markets annually (11700 MT/month). In order to reach a more valid conclusion regarding the annual average total amount of marketed food grain flow into Wollo, however, requires a detailed weekly actual market observations in strategic/relay market centres for at least 2-3 years by good and bad seasons and years. Often, the amount of food grain importation into Wollo increases during the seasonal food shortages (mainly May-September).

Analysis of the survey information reveals that the overall average household-level food self-sufficiency periods (months) in Kolia agro-ecologies are shorter by some 25%, 29% and 10% for the poor, middle and rich income groups respectively than the overall average food self-sufficiency periods in the Dega and Woina-Dega agro-ecologies for the respective income groups. This information confirms the previous research findings in Wolaita (Dagnew, 1993) in that people living in Kolia areas are more food insecure and often vulnerable to disaster-induced food shortages than people in Dega areas within generally food deficit Woredas or regions. This also indicates that, the poor in Kolia areas are more vulnerable to exceptional food shortages than the poor in Dega areas.

20 Table 6: Relativley Grain Surplus and Deficit Sample Woredas by Administrative Zones

Adm.Zones WOREDAS

Grain Moderate* Grain Surplus Deficit

1 S.Wollo Debre Sina Legambo Sayint Jamma Tenta Bat i Esaye-Golla Kutaber Worebabo

2 N.Wollo Wadla Dawnt Meke t Guba-Laf to Seqota Bugna

3 N .Shewa Dera Kewot Geram ider Yefat & Timuga Lay-Bet

4 E .Gojjam Shebel- Berenta

Enes ie- Sarmidir

Hulet- Eju Enesie

5 S .Gonder Lay-Gayint

Note: * These are generally grain deficit woredas that are mostly dependant on the surplus grain produce of some pocket areas within the same woredas supported by some importation from adjacent surplus areas to bridge the gap of food needs.

Source: Survey Data (Dagnew, 199-1).

21 Analysis of the information in table 5 also shows that, the overall average household food self-sufficiency months by income groups in food deficit areas is less by 40%, 44% and over 25% for the poor, middle and rich income groups respectively when compared with the average food self-sufficiency months by income groups in relatively food surplus Woredas. Generally, food grain surplus producing Woredas in the main survey region include Jamma, Wore-Ilu, Legehida, Kelala, Wogidi, Debre Sina, and parts of Esaye-golla in S. Wollo; and Delanta, Wadla, and Dawnt in N. Wollo. Other Woredas in Wollo are generally food deficit and prone to the recurring disaster-induced food shortages. Sample food deficit and Surplus grain producing Woredas by administrative zones are shown in table 6.

V. GRAIN MARKETING AND HOUSEHOLD FOOD SECURITY IN WOLLO

1. Definition of Food Security

Although interpreted in many ways, the World Bank (1986, in Maxwell 1992) defined 'food security’ as "access by all people at all times to enough food for an active, healthy life". Here, its essential elements are the availability food in sufficient quantity and quality, accessibility, affordability or the ability of people to acquire it in sustainable manner. According to the United Nations (1990, in Maxwell 1992), household food security is defined as "the ability of a household members to assure themselves sustained access to a sufficient quantity and quality of food to live active, healthy lives. This may occur as a result of adequate home production of food and/or adequate economic and physical access to food. Economic access comes from an adequate purchasing power, while physical access refers to the proximity of markets or other distribution channels through which food may be acquired". On the other hand, 'food insecurity’ can be defined as the lack of access to adequate food in terms of quality and quantity. The distinctions between 'chronic’ and 'transitory’ states of food insecurity problems would be necessary to keep in mined. According to World Bank (Ibid), "chronic food insecurity is a continuously inadequate diet caused by the inability to acquire food. It affects households that persistently lack the ability either to buy enough food or to produce their own. Transitory food insecurity is a temporary decline in the household’s access to food". It results from instability in food production and supply, food prices, household income, and purchasing power. In its worst form, transitory food insecurity produces famine.

2. T he Role of Grain Marketing_in Ensuring Household Food Security

Traditionally, subsistence producers (peasants) in Ethiopia derive most of their family consumption requirements from domestic food production, largely from agricultural (crop and livestock)

22 production activities. Most often, failure to achieve self-sufficiency in food production forces peasants to get involved in the market-based economic activities (such as asset sales, petty trading, food purchases, borrowing and selling family labour, etc.). Failure to achieve self-sufficiency does not only drive households to depend on market-based food supply sources, but also to depend on non-market based income and food supply sources , the character of which depends on the economic status of households and the magnitude of food scarcity. In times of deepening food crisis, households intensify market-based economic activities as an adaptive or income and food supply stabilization strategy when their first production-based income and food supply fails (Dagnew, 1993 ) .

In this context, grain marketing refers to the market-based economic activities often played by merchants and middle-level traders, and mainly rural-based peasant and non-peasant petty traders as their main and secondary sources of income respectively. These are the main agents of food grain distribution generally from relatively grain surplus areas or markets to grain deficit areas or markets at all levels. However, merchants followed by middle-level traders often focus on distant trading (paying little or no attention in supplying secondary markets such as local , Woreda and even Awraja-level market centres), although they use lower-level market centres as their buying centres mostly through their trading agents or relay sources. Such traders are often perceived by local urban and rural people (mainly by consumers) as some of the important market price destabilizing or worsening factors in periods of growing food production and supply shortfalls. This is because, traditionally (particularly in times of growing food scarcity), big traders often tend to extract or grab food grains brought to local and Woreda-Awraja level market centres at a relatively increased prices with the expectation of sales at a highly inflated prices in other distant regional and/or national market centres like Dessie, Mekele, Addis Ababa and as far as Asmara. This trading practice often tends to further aggravate existing food grain availability problem and market price increases at local and other relatively higher level markets, although the root cause of such food availability decline may be due to production decline or inadequate marketable grain surplus. The food availability decline (food scarcity) often results in immediate price escalation seriously affecting the purchasing power of local consumers (mainly the low-income groups).

On the other hand, rural-rural and rural-urban petty grain traders (predominantly peasant traders) are perceived by local consumers as generally useful trading agents although their activity

Non -mar ket bas ed income and food supply sources refer to hou seho Id depe ndence on gene ral 1y unmarketed food supply and i ncome sources such as w ild food s, gifts or remittances from kin and friend S , rel ief food , begging, and other social and inst i tut ional Sllppor t .

23 is not profit-free. This is because, such petty traders (including urban-based grain retailers): (a) do not often ask for higher profit (i.e, they sell grain at a relatively fair price affordable by the low-income groups; (b) collect grain from both relatively accessible and inaccessible parts of grain surplus localities/marketable grain sources and facilitate grain availability in local and other secondary markets; (c) mostly use work animals (eg, donkey, mule, horse) to transport food grains purchased from different local sources which markedly reduces transport costs/unit, which positively contributes (encourages) for the resale of the same at a relatively lower selling prices to consumers; and (d) they often don’t tend to hoard grain as opposed to big traders. Big merchant and middle-level grain traders with adequate capital and warehousing facilities often tend to hoard grains with the expectation of higher future prices (price speculation). This becomes one of the sources of food scarcity and sharp price increase. Thus, in relative terms, petty grain traders play a useful role in local-based grain distribution, directly or indirectly helping the low-income consumers to get access to or buy food grain at lower (affordable) retail prices per unit.

Previous study (Dagnew, 1993) shows that petty trading in the Ethiopian context is one of the many important secondary economic activities that mainly rural households are engaged in either all year round or seasonally undertaken with the objective of supplementing income from the primary source(s) to avoid the risk of shortfalls. Petty trading generally "involves the buying and selling of farm products and by-products and various consumer petty commodities for resale within the same and/or distant villages or towns".

Although records are not available, the results of our discussions with sample SC members, key informants and relevant MOA marketing and extension staff in North and South Wollo indicate that a significant number of peasant traders participate in the rural grain trading business (including livestock trading) as their secondary/supplementary economic activities. The survey information indicates that, from year to year the number of participants in grain followed by livestock petty trading in order to secure their family food security (ie, to cover the growing food supply shortfalls as a result of farmland inadequacy and/or crop loss due to exceptional rain failure, pest attacks, etc.).

In conclusion, despite the negative effects of the policy-induced trade barriers of the past and the present mainly

24 transportation/communication and trade regulation problems, petty- trading in Wollo and adjacent regions has been one of the vital sources of income and food supply as a secondary occupation in both normal seasons and crisis situation. In particular, petty trading plays a good role in: (a) securing family food security (as income sources for traders themselves); and (b) food grain distribution from supply sources to food deficit areas or market centres in periods of food scarcity not only in Wollo and adjacent regions, but also in the country at large.

VI. THE SURVEY RESULTS

Although parts of the survey findings are also included in the discussions made in chapters four and five (above), the main survey results are discussed under the following sections and sub-sections of this chapter.

1. Food Deficit Areas in South and North Wollo

In chapter four (under section 4), we discussed about the general agricultural situations, food supply and the food insecurity problems prevailing in North and South Wollo in relation to their causal factors. Although food deficit areas vary according to their agro-ecological and people’s occupational differences (eg, lowland pastoral and agro-pastoral areas vs mixed farming and crop dependent high land areas), generally food deficit Woredas by administrative zones include: - Sequota, Ziquala, Abergele, Dahena, Bugna, Gidan, Mekete, Guba Lafto, Kobo and Habru Woredas in N. Wollo; and - Bati, Tehuledere, Worebabo, Ambassel, Dessie Zuria, Kuta-Ber, Kalu, Albuko, Dewerahimedo, Artuma, parts of Esaye-Golla, Tenta, Mekdela, Legambo and Sayint Woredas in S. Wollo.

Some Woredas in N. Wollo such as Kobo, Habru and parts of Guba Lafto, however, become either self-sufficient in food production or produce marketable surplus sorghum in favorable years using Meher (Kremt) rains. In favorable years, these parts of N. Wollo traditionally used to export their marketable surplus sorghum to food deficit Woredas within Wollo and even to distant markets as far as Mekele and Asmara. Other Woredas, such as Kalu, Tenta, Mekdela and Legambo in S. Wollo become relatively self-sufficient in food production using both Belg and Meher rains, although there appears to be a generally steadily declining trend in their food production and supply situation in the recent years. As regards the general food situation in Wollo, the gap between the yearly food production/supply and the food requirements at household and regional levels has been widening alarmingly particularly since early 1980s.

25 2. Ma.ior Sources of Marketable Grain Surplus Areas

i) Marketable Grain Surplus Areas in Wollo

As indicated earlier (see table 6), the main marketable grain surplus producing areas (Woredas) in Wollo include: - Jamma, Wore-Ilu, Legehida, Kelala, Wogidi and parts of Esaye Golla Woredas in S. Wollo; and - Delanta, Wadla and Dawnt Woredas in N. Wollo. These areas, which cover about 27% of the total existing Woredas in Wollo have traditionally been supplying many of the food deficit Woredas and urban centres with their marketable grain supplies in both good and bad years. However, the marketable surplus produced by these Woredas has not been adequate to cover the food needs of the people in food deficit Woredas, and the regional food needs at large. Historical information of the field work indicates, even these surplus Woredas were victims of the 1984/85 devastating drought-induced food crisis.

ii) Marketable Grain Surplus Areas Outside Wollo

Figure 3 demonstrates the directions of marketable food grain movements (ie, marketable grain flows from surplus grain producing areas to food deficit areas) in both 'normal’ and crises years. Table 6 shows Woredas outside Wollo which have been the major sources (exporters) of marketable food grain staples by administrative zones and Woredas. Sample respondees in both Borena and Dera indicated that, Dera Woreda in North Shewa has been the main supply source of marketable grains (primarily sorghum and Tef) to many markets in the food deficit parts of southwestern Wollo for the past over two decades. Woremo Wajitu Woreda is another marketable sorghum and Tef supply source next to Dera. Sorghum and Tef purchased by petty traders at weekly Woreda market centres (eg, Gunde Meskel in Dera) including from secondary/local markets are transported using transport animals, and often sold at relay markets located in Borena. Relay markets include Gorenge and Wogidi in Borena. There are also minor relay markets within these Woredas. Such grains are again relayed to Mekane Selam (in Borena, Debre Sina Woreda), a major relay market centre for many of the markets in food deficit Woredas in S. Wollo. Dera Woreda often exports its marketable surplus sorghum, Tef and chick peas to the neighbouring Woredas in the former Awrajas of Merhabete and Selalie primarily using transport animals followed by light trucks (short haulage vehicles) in dry seasons. Tef and chick peas are also exported to distant large markets (eg, Addis Ababa).

The second important supply sources for marketable grain (mainly Tef, sorghum, chick peas, horse beans and barley in order of importance) are Shebel Berenta and Enesie Sarmidir Woredas in the former Bichena and Mota Awrajas respectively (in the present East Gojjam Administrative Zone). Traditionally, Tef, chick peas and sorghum are purchased at Yedoha market (in Shebel Berenta) by petty

Figure 3: MAP SHOWING THE DIRECTION OF MARKETABLE GRAIN MOVEMENTS (FROM GRAIN SURPLUS PRODUCING AREAS TO FOOD DEFICIT AREAS) IN BOTH ‘NORMAL’ AND CRISES YEARS.

REGION 2 (AFAR)

Ito&U vo

LEGEND:

Direction of Marketable Grain Movements Using Long and Short-Haulage Trucks

Direction of Marketable Grain Movements Using Transport Animals

Regional Boundary

Zonal Boundary

All-Weather Road

(5) Major Towns

♦ Other towns

1 traders and transported to Mekane Selara via some secondary/local relay markets primarily using transport animals. Sorghum, Tef, horse beans and barley (in order of importance) from local/secondary markets Mertolemariam Woreda (in E. Gojjam) and transport it across the Abay river via local relay markets such as Densa and Denbela and finally reach Ast (Adjibar) "Gebeya" (Woreda market centre) in Sayint. As Sayint is one of the chronically food deficit Woredas, all types of imported grains from neighboring sources for domestic consumption circulates within the same Woreda by petty traders (nothing is relayed to neighboring food deficit Woredas). Mekane Selam in Debre Sina is one major source of imported grain surplus for Sayint. The survey information indicates that, in the olden days, people in Sayint used to get marketable grain supplies from S. Gonder (former Debre Tabor and parts of Gayint Awrajas). However, this grain trading link discontinued as a result of the opening of the Woldiya-Woreta all-weather road built by the Chinese.

As indicated in table 8, some particular Woredas in S. Gondar Administrative Zone are the main sources (exporters) of marketable grain staples for many markets in N. Wollo. As reported by different sample respondees at all levels, Woredas including: (a) Estae, Farta, and Fogera Woredas; and (b) parts of Simada, Lay-Gayint, and Tach-Gayint Woredas in the former Debre Tabor and Gayint Awrajas respectively have been the main sources of imported grain staples. Estae, Farta, and parts of Simada in particular, are the chief sources (exporters) of Tef that is marketed primarily at Woldiya (as a major relay market centre to secondary markets within N. Wollo and as far as Mekele in Tigray and Eritrea). Although the three Woredas in Gayint are not generally self-sufficient in food grain production, highland parts of each Woreda are sources of marketable pulses (eg, horse beans) some of which are imported by traders at Woldiya via Nefas Mewcha (major relay market in Gayint). Traders at Woldiya also indicated that Fogera Woreda is one of the most important sources for marketable surplus of chick peas followed by sorghum. Chick peas from this particular Woreda is exported to Woldiya and other distant northern market centres (eg, Mekele) mainly using medium and large

7 Mekane Selam is one of the major relay markets for both locally produced marketable grain surplus and imported grains from neighboring sources.

8 Petty traders (either from Wollo or Gojjam side) cross the Abay (Blue Nile) river with an amount of 30-50 kg of grains at a time with the help of local people (swimmers) to either direction. 'Tankua' , a local reift made from pieces of light wood is used to load grains of limited weight and pushed from one side systematically by local swimmers from an angle until they reach the other side of the river bank. Transport animals await from either sides of the river banks. Some times traded animaIs from Wollo also cross the river guided by swimmers. Traditionally, local swimmers helping petty traders in crossing the river also charge some money (very minimal) for the service they render.

28 Table 8: Major Sources of Food Grain Staples(Surplus Producers &. Exporters to Food Deficit Areas) by Zones & Woredas

Sources of Surplus Type of Importers (deficit areas, Grain Staples Food including relay market centers) (Exporters) Grain Staples

Woredas Admin. Nearest Middle Distant/ Zones furthest

1 De ra North Sorghum Food Deficit Merhabete Addis- Woremo Shewa Tef PAs within (eg.Alem- Ababa Waj i tu Ch.Peas Dera & Ketema) (largely adjacent Selale Tef ) Woredas ( eg. Fitche, Borena Gebre- (mainly Guracha, Mekane- etc . ) Selam & Gorenge markets)

2 Baso N .Shewa Tef Food deficit Debre Addis- Ankober Wheat PAs (within Birhan Ababa, Jiru & adjacent market Mehal- Shenkora Woredas) Meda(in Tegulet Menze) & Shewa- Robi t via Debre Bi rhan

3 Ankober N .Shewa Barley Food defi Debre- Addis- Baso cit PAs Birhan & Ababa Sela- (within & Mehal- Dengay adjacent Meda Keya- Woredas) Gebriel

4 M i n j a r N .Shewa Tef Food Deficit Debre- Add i s- Majete PAs & Market Bi rhan Ababa (Gemza ) Centers(eg. (for ( for Kara-kore & Minjar) Minjar Majete)* Ataye &. Tef ) Kemi ss ie Kombo1- ( for cha, Majete) Dess ie, & Asmara

29 continued from table 8

Sources of Surplus Type of Importers (deficit areas, Grain Staples Food including relay market centers) (Exporters) Grain Staples

Wo redas Admin. Nearest M iddle Di stant/ Zones furthest

5 Majete N . Shewa Sorghum Food deficit Menze & Markets Yi f at PAs within Gishe of Kewot &. adjacent Awraja South Yi f rata- Wo redas (in- eastern na Jile cluding to Wol lo (in good relay market ( eg . years) centers)** Bati )

6 Debre- Tef, Local & Adjacent Dessie Sina South Wheat, Woreda Woreda (as a Kelala & Wollo Sorghum Markets Sayint Relay Wog id i Barley, (within (Adj ibar) market (Borena) H .Beans each Woreda) Legambo to A . A & (eg. (eg . Lent i1s Akista) pulses) markets, Mekele etc . and Asmara) (eg.Tef H .beans& Lentiles

7 J amnia j Wheat, Local market Ligambo Dessie Wereillu South Tef, within each (Tincha &. (as a & Wol lo H .bean, Woreda Akista) relay Legahida & and other market F. peas adjacent centre Worda to market distant centres markets)

8 Esaye- Sorghum Local Adj acent Bati Gol la South Ma i ze markets food Ausa (in good Wollo within the deficit (Afar) years ) Woreda Woredas Dessie & (eg.Deway D .zuria Rahmedo & ( i nc1 . Artuma) Kutaber)

30 continued from table 8

Sources of Surplus Type of Importers (deficit areas, Grain Staples Food including relay market centers) (Exporters) Grain Staples

Woredas Admin. Neares t Middle Distant/ Zones furthest

9 Delanta N.Wollo Barley, Local Adjacent Dessie & Wheat, markets food D .zuria, H . bean, Delanta deficit Woldiya & (eg. Wogel woredas (feeding Lent i1s Tena) (eg.Kuta- d istant ber, markets Ambase1, such as etc . ) A. A. , Mekele & Asmara)

10 Wadla- Barley Local food Adjacent Woldiya Dawnt North Wheat deficit Woredas &through Gidan & Wollo Pulses areas & (eg.Bugna it to some market Kobo, parts of centers Alamata Meket within each Korem, Woreda Mekle & Asmara

11 Habru & Sorghum Local market Adjacent Mekele & Kobo North Tef & food food Asmara (in good Wol lo de f ic i t deficit (via years) areas within Woredas Woldiya each Woreda or as the markets central ( eg . reg ional Ambasel, markets) We rebabo, etc . )

12 Enes ie- East Tef , Local market Sayint Add i s Sarmid i r Gojjam Barley, & food ( in Ababa ( H . bean deficit low Wo11o ) includes land areas c ross i ng Lentiles within the Abay ) Woreda River

31 continued from table 8

Sources of Surplus Type of Importers (deficit areas, Grain Staples Food including relay market centers) (Exporters) Grain Staples

Woredas Admin Nearest M iddle Distant/ Zones furthest

13 Shebel- East Tef, Local Bichina & A. A. ( Berenta Gojjam Sorghum markets some to directly Chick- including Debre- or in- Peas some food S ina d i rectly deficit (Borena through lowlands in Wollo) Bichena along the crossing market) Abay Gorge Abay River

14 11 u 1 e t - East Tef, Local Bahr Dar Addis - Eju- Gojjam Barley, markets and Ababa, Enesie Pu1ses very few Mekele & food deficit Asmara PAs within each Woreda

15 Parts of Food deficit Woldiya, 5 imada South Tef, areas and Ne f as- Mekele (eg. Lay Gondar Pulses market Mewcha via 6 Mehal (formes centres Nef as Simada), Gayint within each Mewcha Betelihm awraja) Woredas in Tach Gayint, Ambeshit & Zoga areas in Lay - Gay int

16 Estae South Tef , Local market N e f a s Wold i ya Farta Gondar Bariey, in each Mewcha & Mekele (former Wheat, Woreda (Gayi nt1 (Tef & Dibre - Chick (including Ch ick- Tabo r peas Debre Tabor peas ) Awraj a) as the central marke t)

32 continued from table 8

Sources of Surplus Type of Importers (deficit areas, Grain Staples Food including relay market centers) (Exporters) Grain Staples

Woredas Admin. Nearest Middle Distant/ Zones furthest

17 Fogera & Tef, Local market Bahr Dar, Woldiya Dera (a South Sorghum (Hamusit & Addis- & Mekele Woredas Gondar Chick Woreta as Zemen & (Chick close to peas relay Ebnat peas Bahr- market only) Dar) centres)

Note PAs = Peasant Associations * Relay markets to other food deficit areas A.A = Addis Ababa ** Relay market centres include Majete, Karakore, Ataye & Shewa-Robit. Abay River = Blue Nile River

Debre Tabor, Nefas Mewcha and to some extent Woldiya markets serve as relay markets to other northern markets(eg. Mekele). Mekaneyesus (in Estae)is a well know market centre or source for marketable grain surplus (especially Tef).

Source:- Survey Data (Dagnew, 1994)

33 Table 9: Main food Grain Staples (in order of importance) by Agro-ecologies in Sample Areas of Region Three

Geographical Staple Crops by Agro-ecologies Reg ions Dega W/Dega Kolia Remark

1 South & South Barley Wheat Sorghum This western Wollo Wheat Tef Tef includes Sorghum Mai ze Kutaber & Dessie Zuria

2 South and Barley Sorghum Sorghum Sorghum is South-eastern Sorghum Maize maize the major Wol lo Tef food staple in Kolia

3 North-eastern Barley Sorghum Sorghum This includes Wollo Wheat Tef Maize north- central areas

4 North-western Barley Teff Sorghum Wollo Wheat Sorghum Tef Wheat Barley

5 South-eastern Barley Tef Sorghum Gonder Wheat Sorghum Tef Mai ze Maize Wheat

6 East Gojjam Barley Teff Sorghum Wheat Wheat Tef

7 North Shewa Barley Sorghum Sorghum Wheat Tef Maize Maize Tef Wheat

Source: Survey Data (Dagnew, 1994)

34 capacity trucks. Chick peas and sorghum from Fogera is also exported to other food deficit parts of N. Wollo (eg, Bugna in Lasta and Sequota in Wag) via the relay market centres of Addis Zemen and Ebnat within S. Gondar mainly using transport animals.

iii) Major Grain Staples by Agro-ecological Locations

Earlier (in table 3), we demonstrated the diverse crop types which grow in the three major agro-ecological zones in Wollo, and in the country at large. Table 9 shows the major food grain staples preferred for consumption by rural people living in different agro-ecologicallocations by geographical regions. Examination of this table reveals that people living in Dega areas (highlands) mostly prefer to consume barley and wheat (in order of importance) as their major food grain staples. Horse bean is the next important crop consumed in different forms by highlanders. The most important food grain staple widely used by lowlanders is sorghum. The next important food grain staple in this agro-ecology is maize. However, many lowlanders, the rich followed by the middle income groups tend to use a mix of either sorghum and Tef flour or maize and Tef flour in differing proportions for preparing 'Enjera’, a pan-cake like local bread. The common practice is adding a lesser proportion of Tef flour to either sorghum or maize flour. The main reasons for mixing Tef flour to the flour of either of the two food grain staples is: (a) to improve the quality or taste, and (b) to increase the 'gluten’ content which protects the ‘Enjera’ from immediate drying (improves the texture). However, such choice is not generally available for the low income groups.

On the other hand, the food grain staples used by the people living in generally intermediate zones (Woina-Dega areas) is relatively more diversified than people living in Dega and Kolia areas. People in this agro-ecology generally tend to use more of a mix of any two staple crops indicated in table 9. In the Woina-Dega areas of Wollo region, generally Tef and sorghum appear to be more widely used staple crops followed by wheat, barley and maize (in order of importance). This information clearly indicates that the food habits of the people in this agro-ecology is more diversified than the food habits that prevail in the other two agro-ecologies. In other words, people in Woina-Dega generally try to accommodate the food habits of both Dega and Kolia areas.

3. Actors in the Grain Trading Business

Table 10 demonstrates the direction of marketable food grain movement (distribution) and the actors involved in the grain trading activities at different levels. Rural petty traders and urban merchants and middle-level traders are the key players in the grain marketing business, often distributing marketable food grains from potential supply sources (surplus areas/markets). Petty traders play a dominant role in the rural-rural and rural-urban marketable grain

9 Actors refer to the agents involved in the grain trading business at different levels in the survey region.

35 Table 10: Actors involved in the grain trading business (movement of traded food grains from surplus to deficit areas) in both good and bad years.

Nature of Marketable Petty Urban Grain Traders Grain Movement/ Grain Traders+ Distribution |Middle- |Grain Level Merchants

1 . Rural to rural markets Almost all No involv- No involve (small local markets) involvement* ment ment

2. Rural(local) Dominant Small No involve to urban markets role ** involveme- ment ment 3. Urban to urban markets Small or no Dominant Smal 1 (short distance grain involvement role involvement marketing)++

4 . Urban to urban (long No involvement Small or Dominant or distance grain No involv all share marketing) + + + ement

Note Peasants in food deficit areas are the largest in population size compared with the urban population. They are both sellers (as producers & petty traders) and consumers (buyers for parts of their annual family food needs due to their insufficient grain produce).

+ Includes rural (peasant) and urban (non-peasant)petty traders.

++ This includes grain movements from local or Woreda markets to other Woreda, Woreda to Awraja, Awraja to Woreda, Awraja to other Awraja, Woreda and/or Awraja to zonal and/or regional markets.

+++ This involves long distance grain trading such as from Awraja and/or zonal to regional major markets, and from one regional market centre to the other (eg. Dessie to Mekele or Dessie to Addis Ababa).

* Includes some direct grain sales by producers.

** Includes some direct grain sales by producers.

Source: Survey data (Dagnew, 1991)

36 Table 11: Mechanism (Methods) of Grain Trading*.

S. No. Direction of Marketed Means of Transport System of Grain Movement Transaction

1 . Rural-rural(local ) Donkeys,mule,horse Largely using cash & human labour (barter in some or (carried on head few cases) or back)

2 . Rural-Urban (eg. to -Largely donkeys, Dominantly cash Woreda and/or Awraja mule & horses. used (barter in markets ) -Use of low and rare cases) medium capacity vehicles -Some human labour involved (for carry ing marketed grains) 3. Urban to urban -Mule, horses & Cash only (relatively short donkeys distant marketing) -Light and medium capacity vehicles or trucks)

4 . Urban to urban Dominantly medium Cash only* (long distance to high capacity marketing, such as trucks (including zonal to regional long-haulages) markets, etc.)

Note * This table demonstrates the: (a) direction of marketable grain movement,(b) means of transporting marketable grain from surplus to grain deficit areas (market centres), and (c) the system of transactions.

In some market centres (eg. in South Gondar, Kimir- Dingay area) rock salt (locally termed as "Chew") transported from Tigray (through Woldiya) is also exchanged for Tef and Chick peas after estimating the value of each item (grain in quintals against the rock salt) still using cash for the differential payments. This is being practised by distant traders.

37 movements or trading. Low-level urban traders (including retailers) have a small role in the rural-urban grain marketing. Middle and low-level urban traders play a major role in urban to urban (relatively short distance) grain marketing activities. Generally grain merchants (with better warehouse and trucking facilities) are major players in the long-distance grain marketing business (mostly focusing on major zonal to zonal, regional to regional, and regional to capital market centres).

In the context of Wollo region, relatively a larger number of petty traders are found particularly in food deficit areas. Many peasants in these areas are both food grain sellers (as producers and petty traders) and buyers for parts of the year due to insufficiency of their produce to cover their annual food needs. As regards the actual volume of traded food grains by petty traders, middle-level and big traders, including the actual volume of marketable grain flows from grain supply sources (grain surplus areas or markets) by market centres and seasons is not possible to present in this report due to lack of recorded time series information. However, as briefly discussed earlier, the current estimate indicates that about 20% of the annual food grain requirement for Wollo (in normal years) is regionally imported.

4. Mechanisms and Means of Grain Trading

The mechanisms of grain trade refers to the: (a) ways marketable grain flows from potential grain sources (surplus areas) to grain deficit areas, (b) actors involved in the grain trading business, and (c) nature of transaction. Table 11 shows the mechanisms and means of grain trading that prevails in North and South Wollo. As indicated earlier, the direction of marketable grain flow involves rural-rural, rural-urban and urban-urban (involving both short and long distance marketing activities); and the key players in the grain marketing business include peasant (petty) traders and urban traders (including low-level, middle and merchant traders).

Rural-rural and rural-urban grain marketing activities in Wollo are often undertaken through the use of traditional means of transport. This involves the use of transport animals such as donkeys, mule and horses (in order of importance). This happens in areas where road facilities do not exist (ie, only foot-paths exist). Human labour is another important means often used to transport marketable food grains and other consumer goods parallel to the use of transport animals. Human labour becomes more important primarily in the rugged/inaccessible rural localities where even the use of animal power tends to be difficult (less important).

In general, for short distance urban-urban grain marketing activities (to and from Woreda-Awraja market centres) where mostly dry-weather road facilities are available, some light to medium capacity vehicles (trucks) are used for grain trading. However, even in such short distance urban-urban grain trading movements, the use of transport animals, particularly donkeys and mules is very dominant, and relatively cost effective. Urban to urban long distance grain marketing (where better transport and other marketing facilities are available) involving primarily major zonal, regional and capital

38 market centres, dominantly medium and high capacity trucks are used by urban grain traders/merchants.

Generally, for all grain trading activities at all levels, cash is used as a medium of exchange. However, bartering was observed still being practised in few cases, mainly in rural/local markets (including Woreda-level markets). According to many rural informants and extension agents of MOA, bartering in rural areas has been practised for generations, particularly between highland and lowland produces, and cash crop producers with food grain producers and petty traders. However, such commodity for commodity exchange practice has been declining from time to time. For example, highlanders were observed exchanging horse bean for sorghum with lowlanders at an equal ratio, and local hop for cereals in varying ratios. One of the key informants (trader) contacted at Woldiya also indicated that, at some market centres (eg, Kimir Dingay in S. Gondar), a rock salt transported by distant traders from Tigray via Woldiya is exchanged for Tef and chick peas after estimating the value of loads of grain (in quintals) against the value of rock salt ( 'Chew’ ) still keeping cash in mind for the differential payments.

As regards the grain marketing costs in Wollo, many informants indicated that the use of transport animals (mainly donkeys and mules) by petty traders are relatively cost effective for rural-rural and rural-urban (even in some cases urban-urban) short and medium distance grain trading business. However, information on marketing cost build-up by grain types per unit in relation to the distance of market centres is not available to support the argument of informants. Survey information shows that, petty traders have been transporting marketable food grains and other consumer goods up to a maximum of 200 Km distance for the past many decades using donkeys and mules. For example, grain trading between Mekane Selam and Dessie (180 Km) by petty traders is a common practice. Petty traders often purchase grain at Mekane Selam, a major relay market in Borena (S. Wollo) and sell it at Dessie regional market centre after travelling for an average of 4 days (one way); and an average of 2.5 days from Were-Ilu to Dessie using donkeys and mules as a means of transporting marketable grains.

With regard to grain transport cost using trucks, traders indicated that a quintal of any food grain costs an average of Birr 30 and 25 from Mekane Selam to Dessie, and Jamma/Wore-Ilu to Dessie respectively in dry seasons and up to Birr 50 in wet (Kremt) season from both market centres. Although actual costs using transport animals is not known yet, petty traders mentioned the grain marketing cost using transport animals may be up to 4 times less than the cost/unit paid when using trucks for grain marketing. Although, undoubtedly there may be high marketing cost differences in the two means of grain transporting approaches, it may not be wise to accept such wide transport cost differential. That is, unless the daily labour cost for petty trading/unit, daily expenses for the use of transport animals/unit (in terms of rent) and other associated costs for grain marketing by petty traders are clearly known, it will be difficult to reach a rationally estimated average marketing cost build-up/unit. This problem applies to grain trading that has been

39 Table 12: Problems affecting the movement of food grains from relatively grain surplus to deficit areas in stress periods.

Current Problems Affecting Group Responses * Remark Grain Movements SCs/PAs % MOA Offices % Nj =14** N2 = 18** - Transport/inaccessibi1ity problems (all times) 10 71 14 78

- Transport/inaccessibi1ity problems (in Kremt only) 4 29 4 22 This includes data gathered from MOA zonal offices - Lack of capital for petty trading 7 50 5 28

- Lack of trade regulation 3 21 5 28

- Lack of purchasing power 11 79 10 56

- Storage problem -- 4 22

- Constraints caused by check points -- 2 11

- Production (supply) decline 11 79 67 39

- High transport cost 5 36 7 39

- Sharp grain price increase 9 64 10 56

- Lack of market information - - 3 17

- Market speculation/hoarding 4 29 2 1 1

Note: * Information was gathered from detailed group discussions with the members of Ministry of Agriculture (MOA) and members of Peasant Associations/Service Cooperatives (SCs/PAs) including key village informants and petty traders by sample Woredas. ** The figure represents group responses ( a group consisting an average number of 4 and 5 members from each MOA office and SC or PA. MOA = Ministry of Agriculture Nj = Total number of sample SC/PA member participants N, = Total number of sample MOA staff member participants

Source: Survey Data (Dagnew, 1994)

40 going-on for generations between markets in the surplus areas of S. Gondar and markets in food deficit areas of N. Wollo (eg, grain trading from Addis Zemen and Ebnat to Sequota and/or Lalibella by petty traders) in comparison with grain trading using trucking facilities. Such market information gap negatively affects policy decisions and interventions, and require closer investigation/attention (ie, this requires a detailed study to close the existing information gap).

As regards grain trading across Abay (Blue Nile) river, an interesting traditional transport system is still being used. Food grain purchased in the market centres of both Shebel Berenta and Mertolemariam Woredas in E. Gojjam by petty traders from S. Wollo. These petty traders use transport animals up to the river bank of Abay; and then cross the river by swimming with the help of traditional (local) swimmers for which some fee is charged. The 'skilled1 local people use their 'Tankua', a raft (locally made from pieces of soft wood) for crossing 30-50 Kg of grain at a time. This includes guiding of traded and/or transport animals to cross to either directions. In most cases, transport animals await across either side of the river bank for transport services (owned or rented). Human labour is markedly involved next to the use of work animals in transporting tradeable food grains across the Abay river mainly until it reaches the relay markets in S. Wollo. This traditional marketing link (mechanism) across the difficult Abay gorge also requires a detailed study in order to facilitate appropriate marketing and development interventions.

5. Problems Affecting the Distribution of Marketable Food Grains

Table 12 shows the problems affecting the distribution of marketable food grain from relatively surplus/supply sources to grain deficit areas mainly in stress periods in Wollo region. According to the sample respondents (see group response in the same table), the most chronic problems that still seriously affect food grain distribution from potential sources to grain deficit areas (even in relatively good years) include: inaccessibility/transportation and communication problems, production decline affecting the grain supply and market prices, declining purchasing power of consumers (including peasants), sharp grain price increase in times of deepening food scarcity, and lack of capital for petty traders in order of importance. Some 71% and 78% of the group responses from SCs/PAs and MOA offices respectively indicate transportation and communication problems are the most serious grain marketing constraints followed by a gradual decline of grain supply and people’s purchasing power.

G . General Food Supply and Price Situation

This section briefly discusses the general food supply and price situation in both surplus and food deficit sample areas at the time of survey compared with the previous weeks and/or months. Table 13 shows the 1993 general grain production/harvest situation, current food supply and price situation, and reasons given for grain supply/harvest decline in sample areas reporting shortfalls coupled by price increase.

41 Tabl« 13: Food supply and price situation at the time ol the survey compared with the previous weeks/months of post-Kremt season (ie, between the last and first quarter of 1993 and 1994 respectively)

Survey areas by Food supply and price situation Reasons for food admin, zones 1993 production supply price ranges supply/harvest decSne 1. S.WOLLO - Saint Very poor g-owing food 26.3 - 35.2% Food shortage due to late and (60%- shortage increase irregular Belg & Meher rains, shortfall) (scarce) (in 2 months) pest and hai storm problems Partial failure of Meher - Legambo Shortfall declining 36-131% (sharp crop due to frost & wheat (significant price increse rust. Sharp Price increase due decline from in less than to growing decline in market normal) 2 months) grain supply aggravated by late belg rains,which led many to hoard marketable grains against future seaicity or crisis.

• Tenta relatively some decline 21-36.4% increase Partia) failure of Meher crop poor (some in less than due to problems of rain shortage, shortfall) 2 months) frost and pest problems. - Debre Sina generally small decline Some shortfall when compared good with in pocket areas 26-36% in 6 weeks with normal years some pocket (genralty self area sufficient) shortfall good, though 21.7% production shorfall * Jamma some surplus price increases 17-50% in 6 weeks from the expected total output relatively fast growing food 18-58 in less than Food shortage due to irregular - Kuta Ber Very poor shortage 6 weeks rainfall distribution (late onset & early cessation),pest attack and land size ownership problem. growing food Serious food shortage in Worebabo Very poor shortage (more 14-35% in about 2 lowlands and partial harvest serious in months harvest decline highlands due lowlands) to early cessation of rain, post attack and land owner ship problem alarming decline, Production shortfall due to Bati production but relatively the serious pest attack & irregular failure relief and marketed 14.6-40% in about rainfall distribution (serious grain circulating 6 weeks shortfall) from other sources stabilize market prices Harvest declined in some areas Esaye-Golla some Relatively adequate 27-83% increase in due to rain failure at meher shortfall marketed toss than 2 months planting season and pest attack. (in pocket food supply despite Long distant grain trading by areas) fast price merchants has contributed to increase fast price increase

NOTE Current grain prices rose sharply in many sample markets of S.Wollo in less than 2 months as a result of either late or total failure of this year's Belg rains which tod (a) peasants with some surplus grains to hoard as a hedge against future food scarcity, and (b) grain traders to buy whatever grain is available in the markets speculating better prices (profit) in other distant market centres. The root cause for the grain supply decline and sharp price increase, however,is due to last year's poor meher harvest (production shortfall) as indicated in the table.

4 2 Continued from Table 13:

Survey areas by Food supply and price situation Reasons for food admin, zones 1993 production supply price ranges oupply/harveot decline 2. N.WOULO: Problem of drought, irregulw -G uba Lafto Poor (shortfail in some decline in 39-120% increase rainfall distribution and pest moot areas) marketed food in 2 months attack supply Failure of belg rains followed -B ugna Harvest failure serious food 14-41 % increase by irratic Meher rains and (serious) shortage in 2 months pest attack in most areas TotaJ failure of Meher rains - Sequota serious harvest serious food 33-75% increase in most areas & irregular rains failure shortage in 2 months in other areas Shortage in 5PAs due to hail - W odla Dawnt Shortfall in 5 PAS no significant (-)2-15% in storm and pest attack in only change in marketed about 2 months lowlands (ood supply Irregular Meher rain distribution and - Meket Shortfall in moot food shortage in 0-20% in about pest attack lowlands lowlands 2 months a NORTH SHEWA: Irregular rainfall, pest attack - Geramidor shortfall steadily 5 - 73% in less and ooil fertility problem (insufficient) declining 2 months some decline in 33 • 78% (high Irregular disnbution of - Kewot Some shortfall market food price increase rainfall and pest attack (low land3) supply in 2 months since it is on the main trade route) some decline in 7 - 32% increase Irregular rainfall distribution -Efrata & Timuga some shortfall market food in less than and pest attack (low lands) supply 2 months some shortfall no significant 3 - 7% increase Irregular rainfall distribution - Lay-bet (in many lowland ar change in market in 2 months and minor pe3t attack food supply somo rainfall no change in 0 - 3 0 % Water logging due to heavy • Dera (in pockot areas) marketed food increase in rains, wood and insect pest supply 2 months infestation 4. SOUTH GONDER: steadily declining Irregular/shortage of rain -Tach Gayint Generally (on-going relief data is not & hail storm (in highlands) Lay Gayint poor support is available and pe3t attack & Simada harvest expected to Woreda3 stabilize the worsening situation) 5. EASTERN GOJJA Only 1S PAs (36%) along the Abay - Shebel Berenta Generally surplus Good (no change Generally stoblo Gorge arc food deficit areas woreda from normal years) |(-)23-25%] due to rain shortage and pest increase in 2 months] attack PAs In lowlands along the • Enese Sarmidir Good (self-sufficient Good (no change Relatively stable Abay gorgo often face food wrth some markete from normal (3-20% increase shortages due to rain shortage surplus) years) in 3 months) and pest attack. Hail storm is a common problem m the highlands Stable [(-)1 7 - ( )8% Harvest shortfall was reported - Hulet-Cju Surplus Stable pnce change orJy in 2 PAs due to Eneste woreda in about insufficient rain and pest (exporter) 2 months] attack (in k>v\tands) NOTE:- About 51 % ol Simada woroda is relatively self-sufficient in (ood production /.rth some marketable grain surplus (eg.Tef & Pulses) Some areas (PAs) ol Lay 4. Tach Gayint woredas are also self-sufficient in lood producation. Generally, lowlands aro seriously affected by food shortages

SOURCE: MOA woreda offices, zona) RRC offices, and February to April survey data (Dagnow,1994)

43 Table 13b : Current Average Grain Price Trends in Particular Sample Food Deficit Areas (Dec. 1993 - March 1994).

Sample Major Average Grain Prices/Qt Price Areas Grain % Changes Staples Dec.1993 March 1994

1. North Wollo Sorghum 84 124 48 (Sekota, Tef 150 200 33 Bugna and Barley 105 148 41 Guba La f to ) Wheat 126 149 18

2. Southwestern Wollo So rghum 93 124 33 (Sayint, Barley 88 127 44 Legambo & Wheat 119 178 50 Tenta) Tef 128 167 31

3. Southeastern Wollo Sorghum 97 142 4 6 (Bat i, Wheat 130 168 29 Kutaber & Tef 168 219 30 Worebabo) Mai ze 73 130 78

Table 13c : Current Average Grain Price Trends in Particular Sample Surplus Grain Producing Areas (Dec.1993 - March 1994 ) .

Sample Major Average Grain Prices/Qt Price Areas Grain % Changes Staples Dec . 1993 March 19 94

1. North Shewa Sorghum 4 5 48 7 (Dera Woreda) Tef 95 110 16 Barley 90 100 1 1 Wheat 90 100 11

2. East Gojjam (Enebse Tef 130 131 1 Sarmid i r, So rghum 70 76 9 Hu let Eju- Wheat 1 1 7 106 -9 Enese & Barley 83 8 5 2 Shebe1 Maize 5 9 60 2 Berenta) Woredas

Source: Survey data (Dagnew,1994).

4 4 Figure 4: Current Average Grain Price Situation in Particular Sample Grain Deficit Areas (Dec. 1993 - Mar. 1994)

») l»er»fe G riii Price Treidi ii S ujle Food Deficit toredu of Seioti, ! q( u tad G iUUfto is

lo rti Tolls Setitei Dec. D M »ad lir. 1JM

B lf r / O t .

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-X" B»rlty 0 Wh«»t

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b] Dif fe.-eat ill Are:»{e Gr»ia Prices bj Griii Tj?es n d Sejsaas ia Sn?le Focd Deficit Areis (Seiali, E jj'31 1 C a b i h f t o ) ia Xar ti Vs 1 lo. Blff/QI. 220

200

130

no E2 S □ r«f • A .> IO- m.,: . i i v ._<. 1!0

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So’jrc i. B u i i or. tab I* 13b

<55 c) lreri(e G rtii Price Treids ii tuple Food Deficit loredn of S ijiit, lejubo tad Tetlt it

Soitkteiteri Vollo Setieei Dec. 1))) ud Iirc l 1)94

B l/ r / Q t.

Sorghua

- r - T#f -X- Bjflry O Wh*it

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d) O iffereatiil lu n j* Cnis Prices bj Griia tj;es »ad Seisoss ia Suple Food Deficit Ireas

(S jjiat, lejuho 1 Teati) ia SouUvestera Valla. Blrr/Ot. 220

200

130

1J0 C3 SarsHn E D Tti eud 8k !»7

II!- t: f c E 3 Yf >« i! « !

i ;: - • ® ;c = cz;"

ICO « E = m m 80 C i c i i h i r Wirth 1393 13$ <

Ssi.rc». Em d on lJb!« 13b

46 —

e) lie rije Griia Price Treads is Suple food Deficit Koredu of Bati, tatiber »ad loreb»ba it

S aitieuteri To I la Betieei Dec. 1))] tad lirc i 1H(.

B U r / Q t .

S o r j h u a ~h Whui

-X - T«t • O M

Dtc«fib«r Warch 19^3 I 19b4 \ \

f) Differeatiil l»er»je Gnia Prices bj Gnia Tjpes »ai Seisaas ia Sn?!e Pood Deficit Areas (3iti, tjtiber I Ytrebiba) ia Soulbeutera Valla.

B iff/Q l.

ES SofjJ'tt □ W > » j I E3 t.i

C fj] U i l : i

Ujrch 139 <

S s '. c i E u e J cn labl) U i

A7 Figure 5: Current Average Grain Price Trends in Particular Sample Surplus Grain Production Areas (Dec. 1993 - March 199-1)

t) Aierafe Graia Treads ia Sarplas Grtia Pradncioj Aren (ef. Bert Voredt) ia lorth She™ BeUeea (Dec. 1991 tad urch 1334]

B lr r /Q i.

Sorghuti

-T - T»( X B ar1»y • 0 W h « i l

b) Differentia! Areraje Grain Prices bj Craia Tjpes and Seasons ia Sujle Surplus Grain Prcduciag Areas (eg. Dera) ia Kortb Sheva.

b lrr/G t. 120

100 ..... j\\WV\Avv.vww^...

c:I •a\‘Avvv\U {77 I j i p i i l l EX3 Sorjt-trs ED Ttl eo S i i l i l i i i:~:: Barlijr ES) wy«n

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«o • j j§l§ii§|p§p . . ...,.V i—E2r * ‘ f.\W\&\W€ _ ■ w p z z z s ' ■\v:^‘i"^E5====a to Dt c «.*abtr Ware!- 1993 1934

Source. Eaaid on lablt 13c 48 c) Arerafe Gni a Price Treads ia Sarplas Gni a Prodaciaj Saiple Koredas ia Bast Gajjaa (eg. Eaebse Sirs id i r, 3a let 8ja-8aese 1 Shebel Berest*] Betveea Dec. 1991 tad SUrch 1994 .

BI/r\Q1.

d) Differeatiil Arerije Grain Prices bj Gnia Tjpes aad Seasons ia Surplus Grain Producing Suple V e redas ia K. Cojjai.

BlrrXQt. 138

D»c«nb«f March I 1993 I 1994 I

Scurctt: B ind on labia 13c 49 Figure 6: Comparative Aggregate Price Trends in Surplus Grain Producing and Food Deficit Sample Areas.

i) Overal 1 A re rife Srtii Price Treads it Gni a Deficit Staple A r e u of Kollo (Dec. 1993 - (trek 1 9 9 4 1 .

Blrr/OI.

Sorghtn

- r - T»t

W h.it

£ } Btrlty

■€>■ K ill*

b] (henll Avert{e Grtia Price Trends ia Sarptas Cnia Prod'jciStaple Arets ia East Gojjta tad lorlb Sbevt (Dec. 1 393 - Htrcb 193<). Blrr/Qt.

—*— Sorjbun

- 4 - T t t X m.ii •O 3 irlty •& Wilrt

Uirch 1933 IS*} A

Source Sind on tab!* 13d (Appi.-.dlx 2) EO c) Coipiritive Aterife Grtia Price Qiffereatiilj bj Grtia Tjpes tad Seisoas ia Grtia Deficit. Stiple irtis of Kollo (Dec. 1991 - Itrcb 1334).

Blrf/Ql. 2 1 0 ------

Dtctnbir Uirch I 1993 I 1394 I

d) Coipantire A ferine Giia Price Differeatuls by Gnia Types aad Seasoas ia Surplus Gnia Produciag Snple Arei3 ia Eist Gojjn tad Xorth Sh«vi (Dec. 1933 - X.uch 1334).

Blrr/Qt. 126

G 3 S o r g K n

G 3 Til

ESD Wh.n!

l-:vl B irliy fcs£j a i: •

D ic iflb ti Uirch 1993 1994

Sotrci: Band on labli 13d (AppirdU 2) 51 In most survey areas (with the exception of grain surplus areas indicated earlier), including lowland and highland parts of North Shewa, parts of Wollo, most parts of North Wollo, and parts of Gayint in South Gondar, the information gathered shows a generally fast increasing price trend caused by a declining grain supply in the markets (see tables 13-13b and figures 4 and 5 for details). Figures 4a-4f show the average grain price situation in particular grain deficit areas (December 1993 - March 1994). On the other hand, figures 5a-5d show the average grain price trends of the same period in particular sample grain surplus producing areas. Figures 6a-6d illustrate the comparative aggregate price trends in surplus grain producing and food deficit areas. At the time of survey (February- March), a sharp grain price increase was observed at some markets in S. Wollo (eg, Akista in Legambo and Kemissie in Esaye-Golla Woredas) reflecting the sharp marketable grain supply decline to local markets. According to various sample respondents, a growing grain supply decline is a result of: (a) last year’s poor Meher harvest due to inadequate rain, and (b) failure of the Belg rains (with the exception of some areas which received late Belg rains) which led the better-off peasants with some marketable grains and graintraders to hoard grain due to fear of the impending danger (food scarcity) and price speculation respectively.

One other important reason for a fast grain market price increase (in addition to hoarding of marketable grains) is due to fast distant grain traders interference with high buying power at an increasing price/unit seeking for higher profit in distant market centres where further scarcity-induced escalating grain prices prevail. This depresses the purchasing power of the low income groups. The grain supply and price situations observed in S. Wollo also generally applies to the situation in parts of N. Shewa (eg, Woredas in the former Yifat & Timuga, and Menz and Gishe Awrajas).

The 1993 harvest was worse in the agro-pastoral areas of south-eastern and north-eastern parts of Wollo than in highlands and associated lowland survey areas indicated above. Many information sources indicated that over 70% of the last year’s harvest had failed due to rain shortage and pest attacks. This has led to a sharp decline in marketable grain supply (mainly sorghum) and price increase in many market centres visited (eg, Bati, and Bokeksa in Worebabo). The grain prices in these areas, however, is not as high as what is observed in other sample areas of S. Wollo. The grain price increase in the eastern sample areas (Bati and Worebabo) ranges 14-40%, while the price increase in sample areas in S. Wollo (Legambo & Esaye-Golla) ranges 27-131% in less than two months.

At the time of the survey, the general food supply situation in North Wollo is even worse than the food situation reported for many areas in S. Wollo (including parts of N. Shewa). In particular, a growing food crisis was reported by different respondents at all levels, in Woredas like Sequota, Bugna, Abergele, Ziquala, Kobo and parts of many Woredas of N. Wollo (with the exception of Delanta, Dawnt and Wadla Woredas). This is due to the total and partial failure of mostly Meher rains followed by pest attacks in 1993. This year’s Belg rain has also generally failed which even further aggravated the food shortage/supply and price increases. However, the grain price

53 trends observed in most Woredas seriously affected by food shortages (such as Bugna & Sequota) are relatively moderate when compared to the grain prices observed in sample areas cited in S. Wollo. For example, the price increase observed in Lalibella and Sequota markets ranges 14-75% in less than 2 months. This is primarily because of the positive impact of the on-going food relief interventions by the government and different relief agencies; and secondly because of the effect of a much more localized nature of marketing activity coupled by a generally lower people’s effective demand in North than in South Wollo. The relief grain sold either by the direct beneficiaries or some agencies themselves in N. Wollo has been circulating not only in the local markets around the relief distribution centres, but also in markets in the neighboring Woredas markedly stabilizing grain prices. This also generally applies to the situation prevailing in the south-eastern and north-eastern agro-pastoral areas despite the relief grain circulating (marketed) in these areas is relatively lesser to show a marked impact. Had relief interventions not taken place in particular Woredas most seriously disaster-affected Woredas like Bugna, Sequota, etc., the highest grain price increase of all the survey areas might have been observed in N. Wollo.

Although food shortage is not as bad as the situation observed in Woredas in either Wag or Lasta, an exceptional price increase was observed in Guba Lafto (at Woldiya market). This is for obvious reason that Woldiya (as a junction) is one of the few major relay markets particularly for the northern distant markets such as Mekele and even markets in Eritrea. In times of growing food scarcity, prices in such markets (like grain price rises at Dessie in S. Wollo) often tend to show a sharp increase in relatively shorter period. In particular, market prices at Dessie and Woldiya are very sensitive to food supply changes or food scarcity.

7. General Grain Price Trends Since 1984/85

Almost all parts of Wollo and adjacent areas faced the most devastating famine in 1984/85. It was during this crisis period that the prices of some grain staples rose up to an average of 650 percent in many heavily drought-stricken Woredas. Pre-1984/85 disaster, the general average price range was 40-50 Birr/quintal of grain staple (overall average of 45 Birr/qt.). During the 1984/85 and 1987/88 crises periods, the overall average price of grain staples in sample areas of Wollo rose up to 289 Birr/qt (542% increase). Post-1984/85 crisis period, food grain prices did not fall to the level of pre-crisis period. The overall average grain prices in relatively normal years between 1986/87 and 1992/93 (excluding 1987/88) remained at the level of about 103 Birr/qt. This average price is by 129% higher than the pre-1984/85 grain price level. Comparatively, the overall current average price (at the time of survey) is by 48% higher than the average price level of normal years and by 47% less than the price level of crises periods. The past eleven years overall grain price information also indicates that the general inflation in the survey areas (until the time of survey) has been approximately 22 percent per year. Table 14 and figure 7 show the comparative average grain prices and trends that prevailed in good and bad years by grain types in sample food deficit Woredas of North Shewa, S. Wollo, and N. Wollo Administrative Zones.

54 Table 14: Averago staple grain prices (price ranges) In relatively good yoars compared with tho past crises years (In sample food deficit woredas)

Sam ple Averago prices by grain typos % Prlco Current prl % chango % change I fro m from Woredas by grain norm al yoars crisis yoars changes (Feb-Apr. 1 norm al crises Administrative Zones typos prlce(Blrr:Qt. prlce(Blrr:Qt. Blrr/Qt. years yoars

A SOUTH WOLLO: Sorghum 120.00 220.00 83 140.00 20 • 3 6

1. Bat! I M aize 112.00 153.00 3 7 110.00 - 2 - 2 8

Crisis-1984185 & | Whoat 137.00 200.00 46 160.00 17 • 2 0 1991192; normal- Tef 185.00 270.00 46 220.00 19 ■ 19 1986:87,1992i93;and Averago 138.00 211.00 53 1 5 8 . 0 0 14 • 2 5 current-1994 2.Kutabor Barely 70.00 300.00 329 150.00 114 • 5 0 crlsls-1984,85: Whoat 97.00 35 0.00 261 180.00 86 ■49 normal-1986,’87 Sorghum 78.00 35 0.00 349 150.00 92 ■57

& 1 9 9 2 , 9 3 Tef 154.00 400.00 160 218.00 42 ■46 M alzo 75.00 300.00 300 150.00 100 ■50 Average 95.00 340.00 280 170.00 8 7 ■50

3 . S a i n t Barely 101.00 388.00 284 142.00 41 • 63 (Average of samplo Y/hoat 113.00 37 5.00 232 180.00 59 ■52 sites) Sorghum 99.00 310.00 213 113.00 14 • 64 Tef 125.00 300.00 140 156.00 2 5 ■48 Average 110.00 343.00 217 148.00 35 - 5 7 4.Logambo Barely 56.00 258.00 361 115.00 105 - 5 5 (samplo avoragos) Wheat 107.00 400.00 274 155.00 45 - 61 Tot 119.00 350.00 194 178.00 50 - 4 9 Sorghum 65.00 40 0.00 5 1 5 133.00 105 - 6 7 Average 87.00 35 2.00 336 145.00 76 ■58 5.Warebabo Sorghum 108.00 240.00 122 136.00 26 ■43 (samplo averagos) Whoat 133.00 280.00 111 164.00 23 ■ 41 Average 121.00 26 0.00 117 150.00 25 ■42 B. NORTH WOLLO: Barely 78.00 26 7.00 242 145.00 86 ■ 46 6. Bugna W heat 89.00 286.00 221 143.00 61 -50 (land rollof Sorghum 75.00 29 6.00 295 111.00 48 - 63 Tof 119.00 271.00 128 220.00 85 • 19 Averago 90.00 280.00 222 149.00 70 P ~ 4 5 7. Guba Laffo Sorghum 72.00 200.00 178 110.00 53 - 4 5 Barely 80.00 200.00 150 165.00 10 6 - 18 Whoat 81.00 24 0.00 196 151.00 86 -37 Tot 131.00 240.00 83 200.00 53 ■ 17 Avorago 91.00 216.00 152 149.00 75 ■31 8. Soquota Sorghum 78.00 n,a .. 130.00 67

Barely 115.00 2 9 8.00 - 1 7 5 . 0 0 55 ■41 Whoat 108.00 338.00 213 167.00 55 • 51 Tot 108.00 330.00 206 180.00 67 - 4 6 Avorago 95.00 307.00 219 150.00 59 - 5 0 C. NORTH SHF//A Sorghum 114.00 330.00 163 118.00 4 .6 1 9.E frala & Maizo 101.00 27 5.00 172 95.00 ■6 - 6 5 Tlm uga Tof 183.00 n a - 197.00 8 -- B a ro ly 80.00 n a - 115.00 44 - W hoat 120.00 n a - 200.00 67 -

A vora go 120.00 2S8.00 168 145.00 23 - 6 3

NOTE: na = roliol grain was not available for salo In local markets

SOURCE: MOA Woreda officios (for secondary data including y/ookly monthly market price records): questlonnalro-basod intorvow with samplo SCs PAs members and other key Informants; and direct market observations (Dagnew, 1994).

55 Figure 7: Trends of Average* Staple Grain Prices Since 1984/85 in Wollo and North Shewa

Blrr/Qt

(1984/85) (1986/87 & 1992/93) (1994) Sorghum Wheat Tef _B~ Barley Maize * Overall average grain prices by types Source: Based on the overall average price information in table 14

56 Table 15: The General Trends of Grain Prices in Grain Deficit Areas of Wollo Post-1984/85 Food Crisis (in Relatively Good Years)

Administrative Average Prices by Grain Types and Zones Years

Food Grain 1986/87 1992/93

1. South Wollo:

a) South-Central Barley 62 .00 106.00 71 & South-Western W heat 68 . 00 132.00 94 sample Woredas Sorghum 59.00 122.00 107 (eg. Sayint, Tef 106.00 158.00 4 9 Tenta, Legambo Horse bean 52 . 00 94 . 00 81 and Kutaber) Average 69 . 00 122.00 7 7

b) South-eastern sample Woredas Sorghum 50 . 00 119.00 138 (eg. Bati, Maize 4 0 . 00 98 . 00 145 Worebabo and Wheat 86.00 160.00 86 Esaye-Go11a)

Average 59 . 00 126.00 114

2. North Wollo:

Sample Woredas Bariey 43 . 00 104.00 142 include: Bugna, Wheat 58. 00 101.00 7 4 Sequota and Sorghum 42.00 96 .00 129 Guba Lafto Tef 81 .00 137.00 69 Horse bean 34 . 00 105.00 209

Average 52 .00 109.00 110

Source: Survey Dc\t.a (Dagnew, 199 1)

57 Figure 8: The General Trends of Grain Prices In Relatively Good years in Grain Deficit Areas ol Wollo Post-84/85 Food Crises

South Wollo 8 l r r / Q 1

(86/87) (92/93)

Barley Wheat Sorghum

- s - Tef Horse Bean Maize

North Wollo B irr/Q t

Source: Based on the Information in table 15 58 Table 15 and figure 8 show the general average grain price trends in relatively good years between 1986/87 and 1992/93 in sample areas of Wollo. Although price data by grain types for all relatively good years ( 1986-1993) was required to show the true picture of price changes post-crises periods, we were unable to get a complete price information for the years referred to in most sample Woredas. Because of such data gap problem, it was decided to use only the 1986/87 and 1992/93 average price information for which we were able to gather for indicating the general price changes in about 8 years duration. Accordingly, the two years’ price information considered indicates that there had been an overall average price increase of 60-119 Birr/qt (about 98% increase) in Wollo as a whole in about 8 years. When we look at the price changes by administrative zones during the same period, there had been an average price increase of about 94% (64-124 Birr/qt.) and 110% (52-109 Birr/qt.) in S. Wollo and N. Wollo respectively. Despite the similarities in the general price trends, there were inter- and intra-annual variations in the food supply and market price situations by geographical locations (including by the location of market centres).

Analysis of tables 14 and 15 indicate that, there had been a sharp price increase over the last one decade reflecting a sharp fall in food production and supply in most parts of Wollo and North Shewa. According to sample respondents, there had been a more consistent and serious production and food supply decline for the last one decade in most Woredas, more seriously in the northern, north-eastern and south-eastern parts of Wollo. The most important cause for the annual and/or recurring food supply decline is production decline and/or production failure leading to a sharp price increases. The main causes for the gradual grain production decline and/or recurring total harvest failure in Wollo are the following in order of importance: - seasonal rain failure or shortage of rainfall; - pest attacks; - sharp decline in size of farmland ownership (as a result of yearly re-allocation to incoming settlers and new households); - decline in soil fertility and alarming soil degradation in many areas - productive asset decline and use of unsuitable farm technologies (farm practices); - sharply declining purchasing power (for seasonal input and asset purchases); - decline/absence of institutional farm credit, marketing and extension support services; and - high/growing human and livestock population pressure on available scarce resources such as land.

As regards sample Woredas in N. Shewa, such as Geramidir in Menz and Gishe; Kewot, Efrata and Timuga in Yifat and Timuga Awrajas, there had been also a gradual decline of food supply and price increase despite variations within and between months and seasons of the years. This applies to the situation in S. Gondar (eg, Gayint). On the other hand, very little change had been observed in sample Woredas of East Gojjam with the exception of very few PAs vulnerable to food shortages caused by the recurring drought/seasonal rainfall irregularity and pest attacks alongside the Abay (Blue Nile) gorge. However, the rest

59 Table 16: The roles of rural petty traders and urban grain traders of different economic status in stabilizing food grain supply and prices at local, secondary and major market centres in times of food shortages compared to their roles in normal years in Wollo.

Response figures Response figures Comparative roles of grain on the roles of on the roles of traders at different urban traders petty traders levels in Wollo SCs/PAs MOA SCs/PAs MOA Nj = 12 % N2 = 16 X> N, = 12 % N< = 16 %

Relatively stabilize local 8 67 u | 69 grain availability and market prices.

Distablilize market prices and create scarcity 4 33 4 25 - - --

Participate in grain movements to local markets but they: a) don’t influence (stabilize) market prices _ — 4 33 4 25 b) have little/limited influence on market prices _ 4 33 2 13

Urban (big) traders don’t ex i st 7 58 10 63 - --

Focus on distant major market centres 4 33 12 75 - - -

Often create scarcities in local/secondary markets (aggravating price i ncreases) 5 4 2 11 69 2 13

Some times create scarcity - 1 6 4 33 2 13

Consumers buy food grain:

a) direct from producers only

60 continued from table 16

Response figures Response figures Comparative roles of on the roles of on the roles of grain traders at different urban traders petty traders levels in Wollo SCs/PAs MOA SCs/PAs MOA Nj = 1 2 % N2 = 16 % Nj= 1 2 X N4 = 16 % b) largely from producers & less from petty traders (except in periods of local production short f alIs) c) equally both from producers & petty traders -- - - d) largely from petty traders & less from producers - - 5 42 7 44 e) direct from petty traders in times of local food shortages - - -- - f) direct from petty traders only (all times) - - 5 42 7 g) direct from petty traders and less from big traders - 3 19 2 13 h) direct from warehouses of urban traders - -- - i) largely from warehouses of urban traders and less from both producers and/or petty traders

Note: SCs/PAs - Sample Service Cooperatives/Peasant Associations

MOA - Sample Offices of the Ministry of Agriculture.

Members of each sample group gave two or more answers. Each sample group of SC/PA and MOA comprises of an average of 5 member participants and staff members respectively.

N1 and N3 - Each represents a total sample population in groups (in SCs and/or PAs); and each sample population consists a total of 60 member participants.

N2 and N4 - Each represents a total sample population in groups (MOA offices); and each sample population, consisting a total of 80 technical staff participants.

Source: Survey Data (Dagnew, 1994)

61 of Dega and Woina-Dega areas of E. Gojjam still maintain their historic production of annual marketable grain surplus.

8. The Roles of Traders in Market Stabilization

Table 16 shows the roles of traders at different levels (economic status) in stabilizing food grain supply and prices at local, secondary and major market centres in times of food shortages compared to their roles in normal years in both North and South Wollo. The survey information indicates that the rural grain marketing activities (mainly at the level of local and secondary markets) are dominated by petty traders (mostly with farming backgrounds). The group response in sample food deficit areas generally show that petty traders play an important role in stabilizing grain supply and prices in rural (local) and secondary (Woreda and even Awraja-level) markets mainly using transport/pack animals. Of the total sample group respondents, 67% of the SC/PA members and 69% of the MOA marketing and extension development staff stressed that petty traders are more important in stabilizing local grain availability and market prices than urban traders. This, however, does not mean that the participation of traders in grain marketing may be expected to stabilize markets directly in times of absolute food shortage.

In most sample Woreda and even Awraja towns grain traders/merchants do not exist. Thirty-three percent of the SCs/PAs and 75% of the MOA group respondents indicated that the roles of big urban traders generally focus on distant major market centres (like Dessie, Addis Ababa, Mekele, etc.). Fourty-two percent and 69% of the sample SCs/PAs and MOA staff group respondents explained that in markets where big urban traders are involved, they often tend to create scarcities (destabilized grain supply and prices) particularly in important relay markets aggravating price increases. Urban traders are often blamed by consumers for hoarding food supplies (most importantly food grain) to inflate prices seeking for superfluous profit.

In most local and secondary market centres visited (in food deficit areas) consumers were observed buying food grains largely from petty traders and less from producers (non from big traders). On the other hand, in relatively grain surplus areas such as E. Gojjam, S. Gondar, and Wadla, Delanta and Dawnt Woredas in N. Wollo, consumers buy food grains largely direct from producers and very less/rarely from petty traders at local/secondary markets (including at Woreda-Awraja level market centres, but in a decreasing scale). Ir these areas, petty traders don’t stabilize markets. However, they tire- said to be beneficial in times of disaster-induced food scarcity ir. making food grain available despite the increased price they demand pe r unit.

The perception of the sample respondents on distant traders a1 different levels appears to be very negative. Generally, distant grain traders are considered by rural and urban consumers as some of the important factor for worsening (a) food grain scarcity (negatively affecting grain availability), and (b) grain market price increases at many local and secondary market centers, depressing the purchasing

62 TABLE 17: THE ROLE OF FOOD AID (FOOD RELIEF) IN STABLIZING GRAIN MARKET PRICES IN PERIODS FOOD SCARCITY / CRISIS.

ADMINSTRATIVE/ FACED SERIOUS FO IF YES. RECEIVED RELIEF IF YES, RELIEF FOOD DITRIBUTED IN CRISIS PERIODS: GEOGRAPHICAL SHORTAGES WHEN? FOOD ASSISTANC STA8LIZED STABLIZED FOOD HAD LITTLE HAD NO ZONES YES NO YES NO MARKET PRICE SUPPLY EFFECT AT ALL SCs MOA SCs MOA SCs MOA SCs 1. SOUTH WOLLO: a) South-central and South 7 1984/85 (86% response) 7 5 3 5 3 1 1 1 western food deficit sample (100) — 1987/88 (14% response) (100) — (71) (71) (71) (75) (14) (25) (14) Woredas (including. Kuta-Ber, Saylnt, Tenta & Legambo

b) South eastern sample 1984/85 & 1987/88 (67% response 3 3 3 3 3 Woredas (including Bad, 3 ... 1984/85 & 1985/86 (33% response (100) (100) (100) (100) (100) Wertoabo and Esaye-Gola (100)

2. NORTH WOLLO: Sample Woredas include: 5 -- 1984/85 (80% response) 5 — 5 4 5 4 — — — Bugna, Guba Lattto (100) 1984/85 & 1987/88(20% response) (100) (100) (100) (100) (100) and Sequota 3. NORTH SHEWA: Sample include: Geramidir, 2 2 2 4 2 4 —— — Kewot, and Etrata & Timuga (100) — 1984/85 (100% response) (100) ... (100) (100) (100) (100) Woredas

NOTE: Figures in brackets are percentages of group responses (only group numbers are indicated in the table, each group consisting of an average of 5 member respondents).

SOURCE: Survey data (Dagnew, 1994).

63 power of the poor mainly in periods of growing food production/supply shortfalls.

9. The Role of Food Aid in Market Stabilization

In this context, market stabilization refers to the food supply/availability and price stabilization in markets at different levels in Wollo. Table 17 shows the role of food aid (food relief) in stabilizing grain market prices in periods of serious food shortages. All sample respondents (peasants) in food deficit Woredas, mentioned that they did face serious food shortages in 1984/85. In addition, some sample areas even faced such food scarcity problem in 1987/88, but lesser in magnitude. During these crisis periods, all respondents indicated that they did receive food relief assistance from different sources. Eighty-eight percent of the group respondents (from sample SCs), stressed that the relief food distributed during the crises periods stabilized both grain supply/availability and market prices in relative terms. This information was confirmed by 93% of the group respondents (field experts) from sample MOA offices. For detailed sample responses by food deficit Woredas and administrative or geographical zones refer to table 17.

As regards the disincentive effects of relief food distribution on seasonal crop production activities, most sample respondents explained that, it will not have negative effects as long as proper targeting is applied and distribution doesn’t interfere with peak agricultural seasons (eg, planting and harvesting seasons). Almost all respondents in every Woreda stressed that food relief is vital in disaster-induced crises periods (in periods when no crop production is expected to be undertaken mostly due to weather abnormalities). Many respondents (eg, 3 SCs in Bugna), however, were honest enough to clearly explain both the positive and negative effects of free relief handouts. Having admitted the necessity of relief food assistance in times of serious food scarcity, sample peasants and key informants witnessed that in the past crises and post-crises years, many peasants showed a sign of dependency and used to travel to distant relief distribution sites ignoring their seasonal productive operations (including some better-off peasants). They mentioned to receive 15 Kg of relief grain (some times even less or non at all), peasants used to sacrifice a number of valuable work days. The same sample SCs in Bugna stressed too much dependency (expectation) on free food assistance led people in one community to the extent of postponing the burial ceremony of a person died in the village (a practice which is culturally unacceptable). Many even in other sample areas did not deny the psychological depressive effects of free food distribution.

The discussion results with the experts and development agents of the MOA offices in sample Woredas indicated that free relief food distribution has a negative impact on the regular agricultural extension work and seasonal production and productivity of peasant producers. They stressed the beneficial effects of targeted free food distribution if it is applied on food-for-work (FFW) basis particularly in off-farm (slack) seasons. They emphasise that relief food distribution should be planned/targeted and be implemented in relation to community-based socio-economic developments to avoid its negative impacts. Some offices in both North and South Wollo mentioned

64 1

that the past unplanned free food distributions by some relief agencies in many areas have eroded the psychology of producers, developing a feeling of laziness reducing their household and community-level socio-economic development or productive participations. It was indicated that, many peasants (eg, in Legambo of S. Wollo, and Bugna and Guba Lafto in N. Wollo) developed a saying (in Amharic) "Kanada Kezenebe Chigir Ayinorim", meaning "there would be no problem as long as there is adequate rain in Canada" - Canada considered as the main source of relief grain (imported wheat in particular).

The other disadvantage of free food distribution as pointed out by MOA extension staff was its anti-saving effects. Free food distribution (including FFW) is also said to have a negative effect on production and producer prices if implemented in relatively good production years/seasons. The survey information indicates the high need for detailed or anthropological study on the impact of relief food in selected communities where relief distribution is considered as one of the important sources of household food security.

10. Socio-Economic Impact of Differential Distances From the Main Road/Market Centres

Table 18 shows the impact of differentials in distances and/or inaccessibility problems on food supply/distribution and market stabilization in both grain deficit and relatively grain surplus sample areas. The commonly observed negative socio-economic impact of increases in distance and/or inaccessibility problems primarily in food deficit sample areas covered include the following: a) high transport cost leading to a high grain prices per unit to consumers; declining purchasing power of the consumers (mainly the poor) as grain price/unit rises; grain availability problem (food shortages) in market centres due to supply shortages; negative effects on production incentives leading to production decline per unit due to low income from output sales and high input prices (in remote areas); negative effects on the distribution/provision of other goods and services (institutional support); deteriorating terms of trade between producers and consumers, and between crop and livestock producers; g) serious effect on the rural technology transfer and literacy efforts; and h) further impoverish the poor in both urban and rural sectors.

These problems also generally apply in relatively grain surplus areas (with some exceptions). For the detailed socio-economic impact of differences in distances and/or inaccessibility problems to the main roads/market centres refer to table 18.

65 Table 18: The impact of increases in distance from the main road/market centres and inaccessibility problems on food supply and market price stabilization.

Administrative Socio-economic Impact of Remark Zone Distance Increase and Inaccessibility Problems

1 . South Wollo ■high transport cost (eg. 25-30 Birr/Qt Borena-Dessie,and Woreilu- and up to Dessie) 50 Birr/Qt in ■high grain price/unit to dry and wet consumers (kremt) ■erode purchasing power of seasons the poor respectively ■increase the grain availability problem (food shortage) ■erode producers’incentives due to high input cost or inavailability of inputs leading to low production and income ■negatively affect the provision of institutional support (in goods & services) ■negatively affect the terms of trade between producers & consumers, or between sellers and buyers ■further impoverish the poor

2.North Wollo -lead to a high increase in urban transport cost per unit dwellers and -increasing grai n price per government unit due to dec reasing employees are volume of food supply rural land -erode the purch asing power owners of consumers (mostly -negative effect on input renting to supply and prod uction (due producers) to increasing i nput price/ which is unit and its becoming inavailability in areas among the most needed ) many causes -negatively affe ct the of production provision of in stitutional and supply support/service s decline -negatively affe ct the terms (af feet ing of trade i mproved -further impover ish the poor input use & investments)

3 . North Shewa -price increase/unit due to increases in transport cost -food supply decline and price increase/unit

66 continued from table 18

Administrative Socio-economic Impact of Remark Zone Distance Increase and Inaccessibility Problems

-erode the purchasing power of consumers -high input prices/unit leading to low farm input use and production decline -negatively affect the provision of institutional support -deteriorating terms of trade

4. East Gojjam -increased transport cost/unit -depress producers’ price incentives -lead to decreased farm input use due to high input cost/ unit (negatively affecting production) -pre-and post-harvest grain loss due to low consumption or inavailability of pesticides -decrease or hamper the provision of institutional support -reduce the movement of tradable grain surplus

5. South -increased transport cost/unit Gondar -seriously affect input and output prices -decline in supply flows leading to grain price increase/uni t -erode the purchasing power of the poor -pre-and post harvest grain loss -erode the incentives of producers & even traders -negatively affect the provision of institutional services

Source: Survey Data (Dagnew,1991 )

67 11. The Main Sources of Cash Income

Table 19 shows the main cash income sources for rural households to be used for food purchase and meeting other basic needs in both good and bad years by different income groups. The survey information reveals that, by and large, the main sources of cash income for the rich and middle income groups (better-off households) in most survey areas are from sales of crop produce and livestock (mostly small animals). Livestock sale is the primary cash income source for lowland pastoralists. Better-off peasant households in relatively surplus grain producing areas, however, are more dependent on cash incomes from the sales of their grain produce than better-off households in food deficit areas. The primary and secondary cash income sources of the same income groups in generally food deficit areas are from sales of animals (small animals in particular) and grain produce respectively.

On the other hand, particularly in the eastern lowlands of Wollo (bordering Afar), pastoralists primarily depend on the sales of their livestock (mostly small animals in normal years) to meet their family cash needs. In all cases, livestock plays a significant role in supplementing or complementing household cash needs (in addition to its role as sources of food, farm power, natural fertilizer, and dung for fuel. Some households even from the poverty group also depend on the sales of small animals to meet their cash needs. Some poor households in most villages own small animals (sheep/goats).

Although there is a significant variation in the sources of cash income according to some geographical differences, the most common sources of cash income for the rural poor in most survey areas depend on the sales of family labour (locally and/or through temporary migration), sales of wood and charcoal, and petty trading activities. These economic activities get more intensified in periods of growing food shortages (crises) as the most important coping mechanisms. Petty trading in this context does not only involve grain trading, but also the trading of small animals (rarely including large animals) as one of the important secondary options. For other detailed household cash income sources by income groups and geographical locations, refer to the survey data in table 19.

12. Ma.ior Grain Supply and Marketing Problems

Earlier (in section 5), we attempted to explain the problems affecting the movement of grain from relatively grain surplus to grain deficit areas based on the information in table 12. This section briefly discusses important grain supply and marketing problems prevailing in the survey areas in relation to causal factors based on the information from the field work. Particular emphasis is made on food deficit Woredas of both North and South Wollo. Issues mainly including: (a) grain production and supply problems, (b) grain marketing (including distribution and pricing) problems, and (c) improvement suggestions by sample respondents are discussed in the following sub-sections stratified by geographical areas.

68 Table 19: The Main Sources of Cash Income for Rural Households of Different Income Categories in Times of Good and Bad Years in the Survey Areas of Region Three (by Geographical and Administrative Zones)

Administrative/ Sources of Cash for Different Income Categories Geographical Zones Rich and Middle Income Groups Poor Income Group

1. Southeastern - Sales of grain produce (eg. - Selling family labour & Northeastern Sorghum) (locally & through Lowlands - Sales of animals (primarily seasonal migration) (Wollo) small animals in normal - Sales of wood and (years) charcoal (incl. crop - Renting Camels (including residues & grass sales for payments in kind - in some areas) food ) - Petty trading by those living around towns - Sales of relief grain - Sales of household possessions (in times of food crises)

2. South and - Sales of grain produce - Sales of small share of Southwestern - Sales of animals (primarily their produce (including Wollo small animals in normal green harvest) years) - Selling family labour - Sales of eucalyptus trees (locally & through in the highlands (mainly seasonal migration) alongside the main road) - Sales of wood and grass - Petty trading - Sales of handicrafts - Sales of relief food (in - Dessie Zuria & some parts of Legambo) - Sales of household possessions (in times of food crises)

3. North and - Sales of crop produce - Sales of labour (locally Northwestern - Sales of animals and through temporary Wollo small animals in normal migration) years) - Credit from the rich - Sales of eucalyptus (with upto 100% interest trees in the highlands payable at harvest (eg. in Meket Woreda season) alongside the main road) - Sales of wood and grass - Petty trading - Sales of handicrafts - Sales of relief food (in periods of relief distribut ion - Selling household possessions (in times of crises)

69 continued from table 19

Administrative/ Sources of Cash for Different Income Categories Geographical Zones Rich and Middle Income Groups Poor Income Group

North Shewa - Sales of grain produce Sales of family labour - Sales of small animals (locally and through (including large animals temporary migration) in times of serious Borrowing (credit) food shortages). Rarely, from any source large animals are also (rural/urban) sold to meet different Sales of wood, charcoal household cash needs and grass/crop residues even in normal years. (in the lowlands of eastern Wollo and Yifat and Timuga in N .Shewa t Sales of handicrafts Sales of relief food n periods of relief distribution Selling household possessions (in times of crisis)

5. South Gondar The household cash The cash income sources income sources in this in this zone dosen’t zone generally similar generally differ from to the cash sources the cash sources indicated for indicated for Southwestern and Southwestern and Northwestern Wollo Northwestern Wollo

6. East Gojjam - Largely from sales of Sales o f small share (Grain Surplus grain produce of thei r produce Areas) - Sales of small animals Sel1ing family labour (local1 y in rural & urban) Sales o f wood and dried c ow-dung collect ed from the communi ty grazing areas Petty t rading (mainly by peas ants living nearer to towns)

Source: Survey Data (Dagnew, 1994)

70 i) Grain Production and Supply Problems

In chapter four, an attempt was made to explain the general grain production and supply situation/problems in Wollo as a whole in relation to the general causal factors. Although specific production problems vary in their extent and magnitude (with some differences in types of problems) from one geographical zone to the other, by and large, the following are the most common production problems that prevail in the survey areas of North and South Wollo (including in the adjacent survey areas such as parts of N. Shewa and S. Gondar):

- shortages of seasonal rains (irregular rainfall distribution coupled by recurring rain failure) often leading either to partial or total production/harvest failure; - agricultural productive asset decline both in size and quality (eg, inadequate size of farmland distribution, declining soil fertility and most areas even facing alarming land degradation problems, a problem of land ownership rights, declining in size or lack of draught and breeding animals, shortages of farm tools, etc. ) ; - shortages of seasonal farm inputs due to its inavailability as a result of inaccessibility/transportation problems coupled by high input costs, and/or lack of proper institutional services for timely input distribution, and due to lack/declining purchasing power of farm households. In most cases, all these factors are found to be chronic problems. - seasonal crop pest infestations (including post-harvest losses due to lack of proper storage and crop protection facilities); - poor or lack of agricultural marketing and credit services; - use of traditional farm technologies (still using the traditional farming practices which in many ways is considered as one of the causal factors for the gradual soil erosion or fertility decline, and soil degradation leading to the gradual production decline). For example, irrigated farming, one of the most important farming systems in ensuring sustainable production and household food security is not practised in any of the sample Woredas having some perennial water resources. - poor terms of trade between crop and livestock producers seriously affecting producers’ incentives. This becomes more serious particularly in times of drought-induced food shortages that often lead to a fast decline in stock prices/unit and a sudden increase in grain prices eroding the purchasing power of livestock producers. - population pressure of both human and livestock leading to land scarcity, fragmentation and soil degradation; and - poor/declining agricultural extension support by MOA which significantly affects the production and productivity.

The survey information indicates that, the question of sustainable food production activities and income are being washed out of the minds of most farm producers particularly in most parts of Wollo as a result of the complex problems theyhave been facing yearly. The above complex problems not only affect crop producers, but also livestock producers in all agro-ecologies (more seriously affecting lowlanders). The growing problems for livestock producers is lack of adequate grazing land, decline both in size of livestock

71 ownership and productivity/unit, disease and pest problems, and lack of adequate institutional support (including veterinary service). Livestock producers (lowland pastoralists in particular) suffer more seriously in times of drought-induced pasture and water loss leading to: (a) partial or total livestock loss, (b) a sharp decline in stock prices/unit (deteriorating terms of trade), and (c) serious food shortages due to sharp declines in households’ purchasing power as a result of sharp increases in grain prices.

The production and food supply problems that prevail in other sample areas such as in N. Shewa (eg, Yifat &. Timuga, and Menz and Gishe), and S. Gondar (eg, Gayint) do not generally differ from the problems prevailing in most parts of Wollo.

ii) Grain Marketing Problems

The complex problems indicated above have been the causal factors for the annual production shortfalls in most survey areas in Region Three, particularly in food deficit Woredas of Wollo and adjacent administrative zones. Production shortfall is one important cause for periodic grain supply decline (one of the most important marketing problems) in generally food deficit Woredas. However, there is a marked variation in the degree of annual production shortfalls according to some geographical/agro-ecological differences by Woredas or administrative zones. This also influences the extent and intensity of grain marketing activities accordingly. The following are the most common grain marketing (including grain distribution and pricing) problems prevailing in most sample areas, grain deficit areas in particular: - grain supply/availability decline due to annual production or harvest shortfalls and/or distribution problems; - grain price increase caused by supply decline affecting consumers seriously; - declining purchasing power of consumers (mainly low-income groups); - poor transport and communication facilities that seriously affect the distribution and pricing of marketable grains from surplus to deficit areas (not only resulting often to high price increase of marketable food grains/unit, but also the prices of development inputs and other commodities); - lack of transport animals for both sellers and buyers/consumers; - influences by distant traders on local grain prices (often creating scarcity or market distortions); - lack of market information for both sellers and buyers; - lack of capital/sources of financial credit particularly for petty traders and consumers in rural areas (including in most Woreda and Awraja towns); - hoarding food grains due to price speculation by traders, and by producers as a hedge against future food scarcity. This is one of the important causes for the decline in marketable grain availability in most local and urban markets. - storage problem (one cause for post-harvest losses); - decline in the terms of trade between producers/sellers and consumers (buyers);

72 - lack of institutional support in grain market pricing or market stabilization.

The survey information indicates that the penetration of distant grain traders (including illegal traders) in many market centres has been creating grain market distortions mainly in the central areas of North and South Wollo, alongside the main roads in particular. These problems also generally apply in sample grain deficit Woredas of N. Shewa and S. Gondar. Rural people in some Woredas like Sayint in S. Wollo, Ziquala, Dahena and Abergele in N. Wollo, face the most serious marketing problems of all mainly due to transport and communication problems. Movement of marketable grains and other essential commodities in these areas is very limited or severely hampered by transport and communication problems. Peasants living in these Woredas would be among the many most isolated and deprived of most institutional support services (eg, education, basic physical infrastructures - roads, rural extension support, etc.) in Region Three.

iii) Improvement Suggestions

In the above subsections, we tried to briefly discuss the main grain supply and marketing problems (including the problems of grain production, distribution and pricing) in relation to their specific causal factors based on the information from the field work. Different sample respondents at different levels of the survey areas did not only specify the prevailing grain supply and marketing problems in relation to their causes, but also with some improvement suggestions. Despite some differences in the responses of sample interviewees according to the differences in the types and magnitude of the problems faced, the following are improvement suggestions given by most respondents in order to solve the problems commonly faced by the people in the survey areas (in Wollo and adjacent administrative zones):

- the need for urgent policy attention to establish key transport and communication networks at least up to major relay and secondary market centres (eg, the urgent need of access to all-weather roads, opening of market centres and associated facilities at strategic locations); - urgent need for grain market (food supply and price) stabilization and regulation policy support; - institutional support for improving transport facilities (eg, trucks and transport animals); - there is a high need for an improved credit and marketing institutional support. In particular, there is an urgent need for targeted financial and asset institutional support to improve the economic status and purchasing power of the poor. - the need to encourage for the establishment of food reserves at strategic locations as a buffer stock; - the need to improve grain production and supply/distribution system. For example, removing local check points existing in some areas would be one of the positive policy measures in order to solve or reduce grain distribution/supply and pricing problems; - the need for an improved institutional support with crop protection facilities (eg, protection against store pests);

73 - policy support to improve the terms of trade between food grain and livestock producers, and between producers/sellers and consumers; - a high need to solve the growing problems of farmland ownership rights and inadequacy (farmland shortages/unit) which is currently one of the most important sources of grain production and supply decline; - the urgent need to improve the existing input-output pricing problems in order to promote sustainable food production; - appropriate support to SCs for improving rural marketing and credit services to peasants (and even to petty traders); - the need to provide appropriate farm services, including the transfer of suitable production technologies to promote increasing production and productivity; and - the need of developing targeted development support for both agriculturally potential and deficit areas in order to solve future food production and supply problems.

13. Institutional Grain Market/Price Stabilization Support

In chapter two (section 2), I tried to briefly explain the current government grain marketing policy. The specific objectives of the newly established marketing agency (the Ethiopian Grain Trade Enterprise) is also indicated. Field observations in Region Three show that the full-scale operation by branch offices of the Enterprise has not started yet largely due to capacity problems. Some grain purchasing activity directly from traders and not directly from producers was observed in Gojjam. This was confirmed by Ato Gebre-Meskel (general manager) during our discussion held at the head office. According to the field observations in sample market centres, there has been no sign of market price stabilization effort/support made in most administrative zones visited in Region Three. That is, appropriate institutional market interventions to regulate or stabilize unfavorable market situation following the designed policy objectives have not been exercised yet. The on-going grain purchase directly from traders observed in some survey areas can’t be the answer to it. The hope is that proper measures to attain the actual objectives summarized under chapter two would develop with the Enterprise’s capacity strengthening effort.

74 VII. CONCLUSIONS AND POLICY IMPLICATIONS

1. Production and Supply Problems

The dominant food supply and income source for the majority of the people in Wollo and adjacent administrative zones is Agriculture. Other subsidiary economic activities, often termed as off-farm (non-farm) income generating activities rural people (particularly the low income group) have been involved for decades include petty trading, selling family labour, weaving, pottery-making, blacksmithing, sales of wood and charcoal, and handcrafting. In more recent years, because of the increasing population pressure, the key productive resources such as land have been getting more and more scarce leading to the annually declining family food production, food supply and growing food insecurity. The number of landless and near-landless rural people have increased, gradually leading to a rural unemployment crisis. The serious households’ productive asset decline (mainly including farmland and oxen) are the root causes of the growing food production and supply constraints. Because of such seriously declining key productive resource ownership constraints coupled by the recurrent drought-induced food insecurity, many peasants primarily in chronically food deficit areas make growing efforts to diversify possible subsidiary off-farm income sources indicated above as a coping mechanism. Such growing rural unfavorable situations are likely to foster more migration mostly into urban centres within and outside Wollo which may lead to further urban unemployment crisis. The findings from the fieldwork suggest that, there is an urgent need for appropriate policy interventions in order to enhance community-based diversified production and other income generating activities.

In the recent decades, recurring production shortfalls have been the chief causal factor for the periodic shortfalls in food supply and availability leading to marked price increases. The traditional agricultural practices that prevailed for centuries have to change. Peasants have to get access to improved farm technologies with particular reference to farm tools, seasonal productive inputs, farm power and other farming practices. The agricultural extension services need to be improved, and many areas particularly with poor rural road facilities need to be given special priority support. In order to gradually solve the existing agricultural production-based food supply constraints in Wollo and adjacent areas of Region Three, the government policy should specifically focus on: (a) ways of reducing the growing population pressure and productive asset (eg, land, oxen, farm tools) constraints, (b) prevent infestation of crops by pests and diseases, (c) livestock disease prevention, (d) improving the agricultural inputs, marketing and credit support to producers, (e) improving farmland ownership I'ight and developing ways of solving the problem of yearly re-a11ocation of the already diminished farm plots to new in-migrants and adult children which seriously affects local conservation work and investments; and (f) building the capacity of rural people in disaster prevention, preparedness and management.

75 Moreover, as a result of annual production-based income decline and lack of reserves, the majority of the rural people in the study areas are becoming vulnerable to the recurrent disaster-induced food crisis that has increasingly become a common phenomena primarily since early 1970s. There has been a growing gap between the food requirement of the people and food supply. That is, the food production and supply situation in most sample areas is far below the food requirement at a household, local and zonal levels. The survey information reveals that the overall household-level annual food produced particularly in the food deficit sample areas of Wollo does not last for more than an average of 6-7 months.

Besides, despite the existing variations between seasons, the study reveals that an overall estimated average of 20 percent of the total annual food grain requirement in Wollo (in normal years) is satisfied through regional importation mainly from surplus grain producing areas of N. Shewa, E. Gojjam and S. Gondar. Often, the amount of food grain importation into Wollo markets increases in periods of seasonal food shortages (mainly May-September). There had also been a sharp price increase over the last one decade reflecting a sharp fall in food production and supply in most parts of both North and South Wollo. The past eleven years overall grain price information also indicates that the general inflation in the survey areas (until the time of survey) has been approximately 22 percent per year. This has a serious policy implication in terms of enhancing appropriate income/employment generating schemes to supplement/complement farm- based incomes, and to improve household purchasing power and food security.

Although there is a significant variation in the sources of cash income according to some geographical differences, the most common sources of cash income for the rural poor in most survey areas depend on the sales of family labour (either locally and/or through temporary migration), sales of wood and charcoal, and petty trading activities. These economic activities get more intensified in periods of growing food shortages as the most important coping mechanisms. Petty trading in this context does not only involve grain trading, but also the trading of mainly small animals as one of the important secondary options.

2. Grain Marketing and Household Food Security

In the study areas, grain marketing is one of the important economic activities often played by merchants, middle-level traders, and mainly by rural-based peasant and non-peasant petty traders as their main and secondary sources of income respectively. These are the main agents of food grain distribution generally from relatively grain surplus areas or markets to grain deficit areas or markets at all levels. Thus, in relative terms, petty grain traders play a useful role in local-based grain distribution, directly or indirectly helping the low-income consumers to get access to or buy food grain at an affordable retail prices per unit. In times of deepening food crisis, households intensify market-based economic activities as an adaptive, income and food supply stabilization strategy when their first production-based income and food supply fails. Such local/rural-based economic activities require special policy focus in terms of household

76 and community-level capacity strengthening and provision of marketing infrastructural support.

Traditionally, petty trading is generally undertaken by the low-income groups as a secondary economic activity, while in some cases, it is also practised by the rich to accumulate more wealth in addition to covering their small shortfalls for sustaining family needs. This subsidiary economic activity as one of the major sources of family cash income in normal years also plays a significant role in stabilizing household incomes and food security in times of stress. In times of food crisis, petty trading also plays a significant role in protecting household assets from distress sales. The survey information indicates that, from year to year the number of peasant participants in grain followed by livestock petty trading has been increasing in the recent decade in order to secure their family food security. The problem of periodic growing food supply shortfalls as a result of farmland inadequacy and/or crop loss due to exceptional rain failure, pest attacks, etc. has led many rural households to intensify petty trading as one of the important adaptive mechanisms.

In conclusion, despite the negative effects of the policy-induced trade barriers of the past and the present mainly transportation/communication and trade regulation problems, petty trading in Wollo and other northern regions of the country at large has been one of the vital sources of income and food supply as a secondary occupation in both normal seasons and crises situations. In particular, petty trading plays a good role in: (a) securing family food security (as income sources for traders themselves); and (b) food grain distribution from supply sources to food deficit areas/market centres in periods of food scarcity not only in Wollo and adjacent regions, but also in the country at large.

3. Grain marketing and Distribution Problems

There is a problem of inadequate marketed grain supply in generally food deficit Woredas primarily caused by periodic grain production and supply shortfalls coupled by the chronic distribution problems from potential market (supply) sources. The most chronic problems that still seriously affect food grain distribution from potential sources to grain deficit areas include: inaccessibility (transportation) and communication problems, production decline affecting the grain supply and market prices, declining purchasing

77 power of consumers, sharp grain price increase in times of deepening food scarcity, and lack of capital for petty traders. Transportation and communication problems are the most serious grain marketing constraints followed by a gradual decline of grain supply and people’s purchasing power. The lack of adequate infrastructure (eg, lack of access to roads, market centres, etc.) in many sample areas had been hindering rural market integration and a more equal sharing of food supply problems and/or marketed grain surpluses from other sources, etc. Rural people in some Woredas like Sayint in S. Wollo, Ziquala, Dahena and Abergele in N. Wollo, face the most serious marketing problems of all mainly due to the lack of basic marketing and related infrastructures. The movement of marketable grains and other essential commodities in these areas is very limited or severely hampered by these Problems. Peasants living in such isolated Woredas in Region Three and in the country at large are the most deprived of basic infrastructural government support services.

In most food deficit survey areas (including lowland and highland parts of North Shewa and South Wollo, most parts of North Wollo, and parts of Gayint in South Gondar), the survey information indicates a generally fast increasing price trend that often takes place during pre-harvest seasons, and more importantly in periods of serious production shortfalls which results in declining grain supply in the markets. Such increasing periodic price increases often depress the purchasing power of the low income groups. A growing grain supply decline is mostly a result of either poor harvest due to inadequate rains or as a result of a total rain failure. In periods of serious production shortfalls, better-off peasants with some marketable grains and grain traders usually tend to hoard grains due to fear of the impending danger of serious food scarcity and price speculation respectively. This information has an important policy implication in terms of the need for strengthening early warning information and taking timely food supply and price stabilization measures in areas vulnerable to periodic food insecurity and disasters.

As regards the grain marketing costs in Wollo, the study indicates that the use of transport animals by petty traders are relatively cost effective mainly for rural-rural and rural-urban short and medium distance grain trading business. However, actual comparative trasport cost studies on the use of transport animals and trucks is not known yet for grain marketing cost/unit by distance and type of road used. Such market information gap negatively affects policy decisions and interventions. This requires closer policy attention in terms of giving priority and appropriate support to undertake detailed study to reduce the existing information gap.

Regarding grain trading across Abay (Blue Nile) river, an interesting traditional transport system is still being used. Human labour is markedly involved next to the use of work animals in transporting tradeable food grains across the risky river mainly until it reaches the relay markets in S. Wollo. This traditional marketing link across the difficult Abay gorge is another important area that requires a detailed study in order to facilitate appropriate marketing and development interventions.

78 4. Market Price Stabilization and Income Support

At the time of the survey, grain price trends observed in most Woredas seriously affected by food shortages in N. Wollo (such as Bugna & Sequota) are relatively moderate when compared to the grain prices observed in sample areas cited in S. Wollo. This is primarily because of the positive impact of the continuing food relief interventions by the government and different relief agencies; and secondly because of the effect of a much more localized nature of marketing activity coupled by a generally lower people’s effective demand in North than in South Wollo. Had relief interventions not taken place in particular Woredas most seriously disaster-affected Woredas like Bugna, Sequota, etc., the highest grain price increase of all the survey areas might have been observed in these parts of N. Wollo. Moreover, this study indicates that the relief food distributed in the sample Woredas during the past recurrent crises periods (since 1984/85) has shown relatively stabilizing effects both in grain supply and market prices. Although food shortage is not as bad as the situation observed in Woredas in either Wag or Lasta, an exceptional price increase was observed in Guba Lafto (at Woldiya market). This is for obvious reason that Woldiya is one of the few major relay markets particularly for the northern distant markets such as Mekele and even markets in Eritrea. In times of growing food scarcity, prices in such markets (like grain price rises at Dessie in S. Wollo) often tend to show a sharp increase in relatively shorter period. In particular, market prices at Dessie and Woldiya are very sensitive to food supply changes or food scarcity.

The important implications of these findings is that, there is a need for an appropriate government intervention in improving the marketing infrastructure within food deficit areas and trading links between food grain surplus and deficit areas. This study has clearly demonstrated the role of relief intervention in stabilizing grain supply and prices in periods of growing food scarcity as a result of local production and/or supply shortfalls. Price stabilization is an important area of intervention for improving household purchasing power and food security. In order to stabilize food supply and market prices mainly in targeted areas vulnerable to periodic food supply shortfalls/crisis, policy measures may involve: (a) short and mid-term price regulation, (b) income support through subsidies and proper credit facilities, (c) grain sales at subsidized prices from reserves, (d) improving distribution system for free grain flow, and (e) improving rural market integration by solving the existing local isolation problem through opening access roads and market centres at strategic locations.

5. Specific Policy Suggestions

Earlier, on the basis of the survey findings, we tried to briefly discuss the main grain supply and marketing problems in relation to their specific causal factors. Despite some differences in the types and magnitude of the problems faced by rural people in different geographical locations, the following are some specific policy

79 suggestions in order to solve the major constraints commonly faced by the people in the survey areas in order of priority:

a) Serious policy attention should be given to establish key transport and communication networks at least up to major relay and secondary market centres. That is, there is an urgent need for people to get access to all-weather roads, market centres, and the need to establish new markets and associated facilities at strategic locations. Solving these key inter-related problems would reduce many production, distribution, marketing and consumption-related problems. For example, such policy measures will positively affect not only the distribution and pricing of marketable food grains, but also the distribution and pricing of production/development inputs and other commodities from supply sources. b) There is a need for grain market (food supply and price) stabilization and regulation policy support to communities in grain deficit areas, more importantly in periods of growing food shortages. This may involve the establishment of food reserves at strategic locations, provision of pricing support through subsidies for both food grain staples and productive inputs (eg, seeds, fertilizers, pesticides), controlling of illegal trading of food grain staples and productive inputs, and targeting of relief food distribution in times of stress, etc. In particular, there is an urgent need to enhance the establishment of food reserves at strategic locations as buffer stocks in food deficit and disaster-prone areas. Our field observations in sample market centres reveal that, there has been no sign of market price stabilization effort/support made in most administrative zones visited in Region Three. Appropriate institutional market interventions to regulate or stabilize unfavorable market situation following the designed policy objectives have to be exercised as one of the priority measures of the government marketing agency, EGTE. In order for such institution to take proper measures to attain the actual objectives summarized under chapter two, strengthening the capacity of the institution itself at the appropriate levels is a pre-requisite. c) There is a high need for an improved institutional credit and marketing support. In particular, there is an urgent need for targeted financial and asset support to improve the economic status and purchasing power of the poor. Appropriate support to the agricultural service cooperatives is one of the essential approaches for improving rural marketing and credit services to individual peasant households (and even to peasant petty traders). d) There is a need for policy support to improve the terms of trade between food grain and livestock producers, and between producers/sellers and consumers. Price regulation and/or relief food distribution to most needy areas are examples of important policy options that may be considered particularly in stress periods. This does not only improve household food security, but also help in protecting assets from distress sales and to encourage producers (eg, livestock producers). e) Removing of existing local check points in some areas would also help in improving the grain supply and distribution into the local markets.

80 On the basis of the survey findings, the most critical problems of all that require urgent attention (interventions) by both the government and donor agencies include: (a) solving the prevailing marketing infrastructural problems (eg, provision of support in constructing motor-roads to avoid local isolation and improve market integration), (b) establishing food reserves at strategic locations particularly in food deficit and disaster-prone areas, and (c) providing support in the area of capacity strengthening for appropriate development institutions. These are critical areas that require short and medium term intervention package support. Such positive intervention would not only solve food grain marketing problems; but it could also gradually solve/reduce many other inter-related short and longer term development problems promoting food production and supply, household asset formation, employment or income generation and better food security.

81 REFERENCES

Dagnew Eshete (1993). The Impact of Food Shortages on Rural Households of Different Income Groups and Their Crisis Coping Strategies: A Case Study of Wolaita District in Ethiopia. Ph.D Thesis, Sussex University, Brighton. ------(1993). Types and Roles of Community-Level Institutions: A Case Study of Wollo and Ogaden Regions in Ethiopia. Unpublished Report. ------(1993). A Review of SCF-UK’s Nutritional Surveillance Approach in Wolaita of Southern Ethiopia. A Consultancy Report Submitted to the Office of SCF-UK, Addis Ababa (Dec. 1993). Alemayehu Lirenso (1987). Grain Marketing and Pricing in Ethiopia. IDR Research Report No. 28. Addis Ababa: IDR, AAU. Holt, J. & Lawrence, M. (1993). Making Ends Meet: A Survey of the Food Economy of Ethiopian North-East Highlands. London: Save the Children UK. Maxwell, S. & Frankenberger, T R . (1992). Household Food Security: Concepts, Indicators, Measurements: A Technical Review. Jointly Sponsored by UNICEF and IFAD, New York, 1992. TGE (1992). Negarit Gazeta of the Transitional Government of Ethiopia: Council of Ministers Regulations No. 104/1992 to Provide for the Establishment of Ethiopian Grain Trade Enterprise. Addis Ababa, 19 December 1992. ------(1994). Negarit Gazeta of the Transitional Government of Ethiopia: Agricultural Cooperative Societies Proclamation No. 85/1994. MOA/GOE (1988). Meher Harvest Evaluation Report. Prepared by the regional MOA office, Dessie (Jan. 1988). MOA/TGE (1993). National Conservation Strategy. Prepared for the National Conservation Strategy by the Ministry of Planning and Economic Development, MOPED office at Woldiya, July 1993. ------(1994). Baseline Studies on Rural Agricultural and Other Socio-Economic Situations. A Report Prepared by the Planning and Programming Office of the Zonal MOA in Region Three, Woldiya (Feb. 1994). ------(1994). Baseline Study on the Agricultural and Other Socio- Economic Situations. A Brief Report Prepared by the Agricultural Extension Division of MOA Zonal Office (S. Wollo) in Region Three, Dessie (March 1994). Webb, P. & Others (1992). Famine in Ethiopia: Policy Implications of Coping Failure at National and Household Levels. Research Report 92. Washington, D.C.: International Food Policy Research Institute (IFPRI).

82 Appendix 1

Summary of the Survey Questionnaire:

The survey specifically covered the investigation of the following questions:

- chief sources of marketable food grain staples within and outside Wollo by Woreda and administrative zones (in both bad and good years/seasons); - types of grain staples preferred by the people in different agro-ecologies (grains bought and sold in local/urban markets); - direction of marketable grain flows; - mechanisms and means of tradeable grain distribution; - analysis of the current food supply and price situation by types of food grains; - Major intra- and inter-regional marketing and distribution problems; - impact of distance from the main road or transportation problems on food supply flows and market price stabilization; - the types and roles of grain traders at all levels in: (a) the movement/distribution of marketable grains from relatively surplus to deficit areas, and (b) stabilizing food supply and market prices in periods of food scarcity; - causes/sources of marketable food supply shortages; - factors affecting (favoring or worsening) market prices and food grain movements; - policy interventions and constraints (eg, marketing and credit facilities, input and output price incentives to promote the production of marketable grain surpluses, productive asset situation and problems, transport and other infrastructural supports); - purchasing power and the general productive capacity for family food security; - general trends of food grain marketing and prices; - average months of food self-sufficiency in a year; - sources of cash for food purchase and meeting other basic needs; - general food supply situation and trends; - the role of petty trading (as a secondary economic activity) in ensuring household food security (or as a coping mechanism) in good and stress periods; - prospects in the promotion of market-based economic activities alongside production and other subsidiary economic activities; - aspects requiring urgent policy attention to facilitate production and marketing/distribution problems.

Of these questions, a more detailed examination was made on the most important types of food grain staples, their sources, means of transport (including trade routes), distribution mechanisms, the nature of existing marketing institutions, integration of markets, market prices, and areas of government interventions.

83 Appendix 2

Table 13d : Comparative Current Price Trends in Grain Surplus Producing and Fo -d Deficit Sample Areas (Dec.1993 - March 1994).

Sample Major Average Grain Prices/Qt Price Areas Gra in % Changes Staples Dec.1993 March 1994

1. Wollo So rghum 91 130 43 (Grain Tef 149 195 31 Def ic it Wheat 125 165 32 Areas) Barley 97 138 42 Mai ze 73 130 78

2. EAST GOJJAM Sorghum 58 62 7 & NORTH Tef 113 121 7 SHEWA Wheat 104 103 -1 (Grain Barley 87 93 7 Surplus Maize 59 60 2 Areas)

Source: Tables 13b and 13c (based on the survey data of 1994)