MALAWI Food Security Update May 2009

• The Ministry of Agriculture and Food Security’s (MoAFS’s) second Figure 1. Current estimated food security round agricultural production estimate, released in mid-May, put conditions, May 2009 maize production at 3.66 million MT, a 32 percent increase over last year’s final estimate and 57 percent higher than the five-year average. If confirmed in the final round estimates, this level of production will result in a maize surplus of slightly above one million MT. In the absence of exports or significant procurements by the NFRA and/or ADMARC, prices of maize are likely to remain low owing to the huge supply situation.

• Food security across the country has improved with the arrival of the new harvest, and most households now have access to their own produced food. However, for parts of the Lower Shire, this access will be short-lived and moderate levels of food insecurity are expected to persist, as production in the area was compromised by poor rains during the growing season.

• Local market maize prices continue to drop as new crops enter the market and more people start to depend on own-produced food, thereby reducing market demand for maize. The majority of markets recorded maize price decreases in May, and the percentage price decreases between April and May were also higher this year than last year at the same time. Local market maize prices were generally

higher in the north, where harvesting starts later than in the other Source: FEWS NET regions. Despite a Government of (GoM)-announced minimum For more information on the FEWS NET food buying price for maize in April, farm gate prices are much lower this insecurity severity scale, see www.fews.net/FoodInsecurityScale year than at the same time last year due to bumper production.

Seasonal calendar and critical events

Source: FEWS NET Malawi

FEWS NET Washington FEWS NET Malawi 1717 H St NW FEWS NET is a USAID-funded activity. The authors’ views expressed in this Tel: +265.1.754.892 publication do not necessarily reflect the view of the United States Agency Washington DC 20006 [email protected] for International Development or the United States Government. [email protected]

www.fews.net/malawi

MALAWI Food Security Update May 2009

Food security overview

Food security across Malawi continues to Table 1. Comparison of households without own-produced food and improve as new crop harvests continue. The local market maize prices majority of households are now mostly %HH without own %HH without own Average maize produced food in produced food in prices in April 2008 Average maize prices dependent on their own food production for District April 2008 April 2009 (MK/Kg) in April 2009 (MK/Kg) household consumption, resulting in a decrease Chitipa <1 <1 36 33 Karonga <1 <1 32 25 in the number of households without own- Rumphi 4 <1 43 28 produced food (Table 1). Mzimba 2 1 47 25 Nkhatabay 3 <1 37 28 Likoma 7 3 However, food security in the Lower Shire’s Kasungu 9 2 34 27 Nkhotakota <1 <1 35 24 Nsanje and Chikwawa districts is different, as Salima 4 <1 30 20 Ntchisi 11 3 43 26 the number of households without own Dowa 6 3 37 25 produced food in these areas is much higher Mchinji 2 <1 27 22 Lilongwe <1 <1 39 30 than elsewhere, due to the poor season the Dedza 3 <1 34 30 area experienced. Indeed, farmers in large Ntcheu 2 2 34 35 Balaka 3 1 32 30 areas of central Chikwawa and parts of Mangochi <1 <1 31 30 northern Nsanje did not harvest any maize, as Machinga 6 3 32 30 Zomba 1 2 31 30 the crop was destroyed by a prolonged dry spell Blantyre 3 2 38 35 between February and March. The effects of Mwanza 3 <1 31 35 Neno <1 <1 30 35 the dry spell were most severe in Chikwawa. Chiradzulu 2 2 30 30 Thyolo 1 1 28 25 Mulanje 3 <1 28 25 All other districts in the country indicated that Phalombe 3 <1 27 30 current food security conditions this year are Chikwawa 3 12 25 30 Nsanje 9 23 26 35 significantly better than last year and the past Source: MoAFS/FEWS NET two to three years. District agricultural officials indicate they do not foresee food insecurity beyond the ‘normal’ chronic levels among poor households. Most of these districts expect even the poor to have own-produced food until the last quarter of the consumption year (around January 2010), as opposed to the usual period of October.

In Chikwawa and parts of Nsanje districts, where crop production prospects are poor for a second consecutive season, some households are facing continued food insecurity for the second year. A rapid assessment of the situation by the Malawi Vulnerability Assessment Committee (MVAC) in mid-April indicated significant needs for these areas. The final report containing the details of the assessment results is yet to be released, though the information is urgently needed for decision making with respect to response options in the affected areas.

Given current conditions in the Lower Shire, the MoAFS has intensified winter crop production campaigns in areas with residual moisture or those with access to land along the Shire River. Unfortunately, due to low rainfall in the area, some wetlands which would have been cultivated during the winter season cannot be planted this year, due to lack of residual moisture. Both the GoM and some non-governmental organizations (NGOs) have supplied free seed to some farmers for winter planting in the area, though the needs are greater than what has been provided.

Elsewhere across the country, intensification of winter cropping is being encouraged, and farmers’ responses are encouraging, as they expect to earn more income from selling green maize and other crops, mostly vegetables. Winter maize in many parts of the country is sold green instead of being harvested dry, due to the relatively higher incomes that can be realized from sales of green maize. It is mostly the last of the winter crop, planted in September/October, which is left to dry and used for food during the lean period of January and February.

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MALAWI Food Security Update May 2009

Seasonal progress

Outcome of the 2008/09 agricultural season

The MoAFS released second round agricultural production estimate figures in mid-May. Due to overall favorable climatic conditions during the 2008/09 production season, and increased use of fertilizer and hybrid seed, crop production this season is projected to be higher than last season (Table 2). Maize production is estimated at 3.66 million MT, an increase of 32 percent over last year’s final estimate and 57 percent higher than the five year average. If accurate, this level of production will result in a maize surplus of slightly above one million MT.

Table 2. Comparison of national crop production estimates Comparison: Comparison: 5 Year 2008/09 and 2008/09 and CROP 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 R2 Average Average 2007/08 MAIZE 1,608,349 1,225,234 2,611,486 3,444,655 2,777,438 3,661,732 2,333,432 57% 32% RICE 49,693 41,270 91,450 113,166 114,905 131,058 82,097 60% 14% GROUNDNUTS 153,414 141,078 203,071 273,757 260,573 282,605 206,379 37% 8% TOBACCO 106,187 93,598 121,600 117,412 160,238 192,516 119,807 61% 20% COTTON 53,581 50,363 58,569 63,290 76,761 67,098 60,513 11% -13% SORGHUM 40,905 18,175 54,309 63,698 61,999 58,612 47,817 23% -5% MILLET 17,349 15,970 27,037 32,251 31,869 26,671 24,895 7% -16% PULSES 242,364 209,492 344,586 415,551 396,868 481,992 321,772 50% 21% CASSAVA 2,532,079 2,197,640 2,832,141 3,285,127 3,539,660 3,786,630 2,877,329 32% 7% S. POTATOES 1,762,034 1,081,463 1,781,595 2,307,354 2,362,425 2,634,978 1,858,974 42% 12% I. POTATOES 420,590 404,420 527,831 594,003 673,344 768,315 524,038 47% 14% Source: MoAFS

However, the outlook is less optimistic in the Lower Shire districts of Nsanje and Chikwawa, where prolonged dryness, which lasted for almost a month and two months, respectively, damaged crops, including maize, sorghum, millet, and cotton. The dry spell adversely affected crop production in the area, particularly cotton, sorghum, and millet, as the main production area for these crops were most affected by the dry spell.

If these estimates are validated in the final round of production figures (which is based on actual weighing of sample plots to determine yield), Malawi will have a significant surplus this year. Currently, the MoAFS is selling subsidized pesticides to encourage farmers to store their maize properly and to minimize post-harvest losses due to weevil infestation. Initial indications are that a lot of farmers are buying these pesticides to protect their crop. In addition to the pesticides, the MoAFS is intensifying campaigns to encourage farmers to store enough food for their own consumption and to only sell the remaining surplus. These campaigns began in response to reports last year that farmers were selling off large amounts of maize, due to high prices, at the expense of household food security, as they were buying maize on the market later in the year at twice the price they sold it.

The other concern with this year’s bumper production is that there is no clarity as of yet on whether the ban on large scale traders’ participation in maize trading – which was imposed last year at the peak of high maize prices – will continue this year. During a May field monitoring trip, FEWS NET observed that, in many districts, the local assemblies, in consultation with chiefs, had imposed a ban on selling maize to vendors, since they were mostly paying very low prices, in some cases as low as MWK 12 - 15/kg. These are low prices when compared to last year at the same time when buying prices were in the region of MWK 30 - 40/kg due to the competition among traders. Although the GoM announced a buying price of MK 50/kg, no district has reached that price yet. Traders are of the opinion that, with a surplus, there is no need to buy at a high price. The GoM, on the other hand, wants to protect farmers’ income by setting a minimum price. ADMARC has not yet started buying this season’s maize, as they are waiting for the moisture content to drop. They are likely to start buying in June. For districts like Chitipa in the north, where farmers have a lot of carry over maize from last year, due to limited demand following the banning of vendors by local chiefs, the continuation of the ban on the sale of maize to traders other than ADMARC will affect farmers, as ADMARC did not buy all the maize they had wanted to sell last year. They are concerned that, if ADMARC fails to buy all the maize they wish to sell this, it will be difficult for them to store it.

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MALAWI Food Security Update May 2009

Markets, trade, and food access

The majority of the markets continued to record maize price decreases in May, and the number of markets registering increases dropped significantly compared to April. Out of the 58 markets with comparative maize price data for April and May, 50 recorded decreases in maize prices. Maize price increases this time were also slightly higher than in the previous month. The price increases ranged from just above zero percent at Lunzu Market in to 18 percent at Balaka Market in . Maize price decreases are attributed to increased availability of maize on the market following the harvesting of the new crop in a year when production is projected to exceed the all time high of 3.4 million MT set in 2007. For an illustration of maize price trends at selected markets in the northern, central, and southern , please see the price annex at the end of this update.

Average local market nominal maize prices for May (2 weeks of data) ranged from MK 18.79/kg at Hewe Market in to MK 49.37/kg at Chintheche Market in Nkhatabay District. Regionally, average local market nominal maize prices in the north ranged from MK 18.79/kg at Hewe Market in Rumphi District to MK 49.37/kg at Chintheche Market in Nkhatabay District. In the central region, maize prices ranged from MK 20.00/kg at Mwansambo Market in to MK 48.50/kg at Malomo Market in . In the southern region, maize prices ranged from MK 24.67/kg at Ntaja Market in to MK 45.34/kg at Neno Market in Neno District.

ADMARC is yet to open their markets for maize purchases. Farmers across the country have high expectations that ADMARC will have enough money to buy their maize at the high price of MK50/kg announced by GoM. At the time of writing this update, ADMARC intentions on how much maize they plan to buy were not yet known. The same applies to the National Food Reserve Agency (NFRA), which is yet to release their procurement plans for the year. In any case, given GoM plans not to export – though this may be reviewed after final production figures are released in early July – NFRA and ADMARC could buy 200,000-300,000 MT for local storage, potentially leaving farmers with the remainder of the surplus (700,000 – 800,000 MT). Given this scenario, it is likely that some exports will be allowed in order to create demand for maize and improve buying prices paid to farmers. Without exports, such a surplus situation will likely cause prices to remain low, which is good for consumers but not for the producers for whom maize is a source of income.

Cotton, another cash crop, is not faring well this year, following disagreements between buyers and the GoM on the buying price. The GOM unilaterally announced a price of MK 75/kg, but the main buyers say this is too high and, as a result, have not started buying the crop. This is a cause for concern, particularly in the Lower Shire districts of Nsanje and Chikwawa, where production of this cash crop, as well as the main cereal crop, was compromised by poor rainfall. As a consequence of not opening the cotton markets, some farmers have been forced to sell whatever little maize they harvested in order to meet other household expenses. Additionally, those farmers who traditionally depend on cotton income to buy maize are in a dilemma, since they do not have that income at this time of the year when maize prices are low and they could buy more for the same amount of money than they will be able to in a few months time. The longer it takes for this pricing issue to be sorted out between GoM and cotton buyers, the more it costs the producers, as their cotton loses value.

Tobacco income, too, is expected to be below normal this year, due to low auction floor prices since the season started. Two issues have affected tobacco prices: overproduction encouraged by the good prices tobacco fetched last year and poor quality as a result of the overproduction, as some of the crop was not properly managed. With low incomes from tobacco, poor farmers in the main tobacco areas will be under pressure to sell more maize in order to meet household expenses, compromising their food security.

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MALAWI Food Security Update May 2009

Annex 1. Market prices, January - May 2009 % Change: April Jan-09 Feb-09 Mar-09 Apr-09 May-09 MARKET and May HEWE 45.60 47.30 44.67 32.24 18.79 -41.70 MWANSAMBO 81.51 85.55 73.47 22.22 20.00 -9.99 MISUKU 41.60 51.05 47.38 35.34 23.13 -34.55 NTAJA 74.19 72.14 64.33 21.33 24.67 15.63 SALIMA 81.04 70.66 69.80 70.00 25.22 -63.97 CHILUMBA 52.14 56.88 52.67 33.87 27.09 -20.00 NANJIRI 69.31 72.90 70.00 68.83 27.85 -59.54 THETE 73.75 78.25 67.13 29.00 28.33 -2.30 MULOZA 78.18 77.55 62.03 33.04 28.36 -14.16 MPAMBA 67.34 64.15 54.93 27.59 28.45 3.13 JALI 65.64 69.22 69.47 49.90 28.50 -42.88 DOWA 61.83 58.73 62.70 64.30 28.75 -55.29 NSANJE 91.30 83.37 64.98 32.52 28.89 -11.16 KARONGA 61.84 54.59 64.22 37.66 28.91 -23.22 DWANGWA 72.13 81.08 73.08 40.14 29.44 -26.65 BOWE 57.00 60.88 58.50 53.00 29.50 -44.34 CHIRADZULU 70.00 65.00 60.00 38.10 30.00 -21.26 NAMWERA 75.00 82.98 95.00 30.02 30.50 1.59 MTAKATAKA 82.59 80.22 64.63 26.15 30.65 17.20 MITUNDU 67.41 67.54 68.85 35.41 30.72 -13.26 MONKEY BAY 81.17 82.52 76.21 34.19 30.74 -10.10 BANGULA 88.43 82.58 54.38 34.73 31.11 -10.42 LUCHENZA 90.30 83.18 47.34 41.27 31.17 -24.47 RUMPHI 59.03 59.57 66.45 54.24 31.57 -41.79 NSUNDWE 65.82 62.16 61.23 52.03 31.69 -39.09 LUNZU 78.16 79.86 79.61 31.84 31.95 0.32 CHIMBIYA 66.37 69.21 63.53 38.55 32.68 -15.21 ZOMBA 78.53 78.78 75.39 66.27 32.98 -50.24 CHITIPA 51.70 52.38 54.04 48.88 33.02 -32.44 TSANGANO TURN OFF 72.23 81.21 77.70 50.59 33.05 -34.67 NGABU 77.86 72.73 63.42 51.07 33.33 -34.74 MAYAKA 72.00 63.50 33.38 -47.43 PHALOMBE 85.12 80.93 50.19 33.41 33.78 1.12 LIZULU 74.57 76.39 73.39 54.11 34.20 -36.80 NKHATABAY 53.71 54.50 52.04 40.12 34.26 -14.61 CHIKWAWA 78.91 79.92 69.73 37.72 34.48 -8.58 NAMBUMA 57.82 57.09 63.19 59.44 34.65 -41.72 MZIMBA 54.05 54.38 50.00 45.49 35.00 -23.06 SANTHE 59.40 60.13 57.33 37.14 35.27 -5.04 NCHALO 78.63 76.51 45.63 32.95 35.63 8.12 NKHOTAKOTA 73.90 79.50 63.34 37.89 36.69 -3.17 BVUMBWE 78.63 79.00 73.13 54.40 37.00 -31.99 BEMBEKE 77.78 72.22 67.22 49.02 37.51 -23.49 MZUZU 56.80 59.50 56.16 49.15 37.57 -23.56 LIMBE 106.62 103.14 88.46 54.87 38.53 -29.77 LILONGWE 72.00 71.75 67.61 54.07 40.00 -26.02 NTHALIRE 43.25 46.58 45.05 45.66 40.01 -12.39 MWANZA 92.04 86.49 85.32 59.57 40.40 -32.18 LIWONDE 73.74 75.94 75.54 52.17 42.34 -18.85 MANGOCHI 78.65 81.83 74.78 60.52 42.78 -29.30 NKHOMA 71.37 74.78 66.77 48.82 43.35 -11.20 BALAKA 80.46 76.94 75.54 37.38 44.01 17.75 NTCHEU 80.03 88.55 77.76 46.28 45.20 -2.35 NENO 82.32 81.44 55.56 45.34 -18.40 MCHINJI 61.32 63.97 58.96 51.93 45.60 -12.19 EMBANGWENI 51.50 52.96 55.00 50.34 46.00 -8.62 MALOMO 72.52 74.80 83.63 55.00 48.50 -11.82 CHINTHECHE 51.15 50.20 50.80 54.10 49.37 -8.75 Source: MoAFS

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ANNEX: Malawi Monthly Price Bulletin May 2009

Maize, rice, and cassava are the most important food commodities. Markets selected represent the entire geographic length of the country: two markets in each of the north, center, and south. In the north, Karonga is one of the most active markets in maize and rice and is influenced by informal cross‐border trade with Tanzania. Mzimba is a major maize producing area in the northern region. Salima, in the center along the lake, is an important market where some of the fishing populations are almost entirely dependent on the market for staple cereals. Mitundu is a very busy peri‐urban market in Lilongwe. In the south, the Lunzu market is the main supplier of food commodities such as maize and rice for Blantyre. The Bangula market in was chosen to represent the Lower Shire area, covering Chikwawa and Nsanje districts.

Monthly prices are supplied the Ministry of Agriculture and Food Security Market Information System in Malawi.

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ANNEX: Malawi Monthly Price Bulletin May 2009

Famine Early Warning Systems Network ii

ANNEX: Malawi Monthly Price Bulletin May 2009

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