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Bellmon Analysis in Ethiopia: Crop Production, Availability and Market

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Bellmon Analysis in Ethiopia: Crop Production, Availability and Market BELLMON ANALYSIS Crop Availability and Market Study in Ethiopia January 2018 This publication was produced at the request of the United States Agency for International Development. It was prepared independently by Social Impact, a USAID/Ethiopia Contractor for the Ethiopia Performance Monitoring Evaluation Service (EPMES) Activity. CROP AVAILABILITY AND MARKET ANALYSIS IN ETHIOPIA Analyzing Crop Production, Availability and Market Functions for 2016/2017 and Estimations for 2017/2018 January 2018 Evaluation Mechanism Number: #AID-663-C-16-00010-EPMES Ethiopia Performance Monitoring and Evaluation Service (EPMES) for USAID/Ethiopia Activity Cover photo by Social Impact, Inc. Authors Getachew Olana Nuri Kedir Raya Abagodu Basab Dasgupta Worku Ambelu Francis O. Okello Mildred Magut, Team Leader DISCLAIMER The author’s views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government. ACKNOWLEDGEMENTS The study team would like to thank USAID for its kind facilitation of this study. The staff of Relief Society of Tigray, World Vision International, Catholic Relief Services, and Food for the Hungry provided essential information for this report. This report would not have been possible without the considerable effort made by the Professional Researchers International Network (PRIN) and Social Impact survey teams in collecting the focus group and key informant interview data from rural Woredas. Thanks to all the farmers, traders, and other stakeholders who took part in the interviews and group discussions that form the basis of this report. Mildred Magut, on behalf of the Crop Availability and Market Analysis Study Team September 2017 iv Ethiopia Performance Monitoring and Evaluation Service Crop Availability and Market Analysis in Ethiopia ABSTRACT Prior to the approval of a proposed US food aid program in a recipient country, the United States Government (USG) must make a positive “Bellmon Determination.” USAID/Ethiopia has commissioned in-depth Bellmon Analyses to Social Impact, implementing the Ethiopia Performance Monitoring and Evaluation Service. The purpose of the analysis was to determine that any direct cash transfer and distribution of U.S. agricultural commodities provided for use in Ethiopia during FY18 through Title II meet the criteria set forth in the Bellmon Amendment. The report examines food availability and demand in the country and potential impact of food distribution on the local markets in Oromia, Amhara, Southern Nations, Nationalities and People’s (SNNP), Tigray regions and Dire Dawa city administration. The report analyzes the interactions beneficiaries have with the surrounding markets, the dynamics of the markets, the capabilities of local traders to cope with increased demand, and households’ access to a diversified diet. Quantitative analyses are used to show historical trends, commodity flows, price volatility complemented by qualitative data from focus groups with farmers, key informant interviews with other stakeholders, and secondary data. Results from the analyses showed that food supply in 2017/18 is about 31.45 million metric tons. Food supply will be adequate to meet the minimum energy requirements, only if imports of grains reach 987,300 metric tons, otherwise, it will be inadequate. Cereal availability in Ethiopia is low both in the surplus and deficit areas, causing prices to increase throughout the country. Short-term and short-lived inflationary pressures are evident in the market immediately after a cash transfer. Ports, storage, and inland transportation seem to be adequate for the transportation and storage of food aid commodities. There is therefore no evidence that either a Title II food distribution or cash transfer would have a substantial negative effect on the marketing and production of grains in Ethiopia in 2017/18. v Ethiopia Performance Monitoring and Evaluation Service Crop Availability and Market Analysis in Ethiopia CONTENTS Acknowledgements ...................................................................................................................... iv Abstract .......................................................................................................................................... v Contents ........................................................................................................................................ vi Acronyms ....................................................................................................................................... x Executive Summary .................................................................................................................... xii Background ................................................................................................................................................................... xii Study Objectives .......................................................................................................................................................... xii Study Design, Methods, and Limitations ............................................................................................................... xiii Findings ......................................................................................................................................................................... xiv 1. Introduction ............................................................................................................................... 1 1.1. Background ............................................................................................................................................................. 1 1.2. Study Objectives .................................................................................................................................................... 2 1.3. Research Questions .............................................................................................................................................. 2 1.4. Study Area ............................................................................................................................................................... 3 2. Methodology .............................................................................................................................. 4 2.1. Study Design and Approach ................................................................................................................................ 4 2.2. Data Sources .......................................................................................................................................................... 4 2.3. Sampling and Samples ........................................................................................................................................... 6 2.4. Data Collection Details........................................................................................................................................ 6 2.5. Data Analysis .......................................................................................................................................................... 7 2.6. Limitations ............................................................................................................................................................... 8 3. Context Analysis ....................................................................................................................... 9 3.1. Government Policies Affecting the Agricultural Sector ............................................................................... 9 3.2. Agricultural Overview ........................................................................................................................................ 10 3.3. Food Security Overview .................................................................................................................................... 16 3.4. Trade Overview................................................................................................................................................... 18 3.5. Food Aid Overview ............................................................................................................................................ 23 3.6. Food Aid Interventions ...................................................................................................................................... 27 4. Food Supply and Demand Estimation ................................................................................... 32 4.1. Food Supply .......................................................................................................................................................... 32 4.2. Food Imports ........................................................................................................................................................ 43 4.3. Carryover Stocks ................................................................................................................................................ 47 4.4. Summary of the Overall 2017/2018 Food Grain Availability .................................................................... 47 4.5. Livestock Situation .............................................................................................................................................. 48 4.6. Food Demand ......................................................................................................................................................
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