Ethiopia Bellmon Analysis 2015/16 And Reassessment Of Crop Production and Marketing For 2014/15 October 2015 Final Report Ethiopia: Bellmon Analysis - 2014/15 i Table of Contents Acknowledgements ................................................................................................................................................ iii Table of Acronyms ................................................................................................................................................. iii Executive Summary ............................................................................................................................................... iv Introduction ................................................................................................................................................................ 9 Methodology .................................................................................................................................................. 10 Economic Background ......................................................................................................................................... 11 Poverty ............................................................................................................................................................. 14 Wage Labor ..................................................................................................................................................... 15 Agriculture Sector Overview ............................................................................................................................. 16 Agricultural inputs ...................................................................................................................................... 16 Livestock .......................................................................................................................................................... 19 Crop Marketing ............................................................................................................................................. 20 Government Policies affecting The Agricultural sector ......................................................................... 22 Intensification ................................................................................................................................................ 22 Price Controls ................................................................................................................................................ 22 Strategic Food Reserve .............................................................................................................................. 23 Food Supply in 2014/15 ..................................................................................................................................... 25 Carryover stocks........................................................................................................................................... 25 Meher Production 2014/15 ..................................................................................................................... 25 Belg Production 2015 ................................................................................................................................. 30 Market Trends......................................................................................................................................................... 33 Cereals .............................................................................................................................................................. 33 Pulses ................................................................................................................................................................ 39 Oilseeds/Edible Oils .................................................................................................................................... 40 Factors affecting Grain Supply ................................................................................................................ 43 Deficit Market Conditions ......................................................................................................................... 44 Food Security ........................................................................................................................................................... 53 Wage Labor ..................................................................................................................................................... 54 Consumption .................................................................................................................................................. 56 Impact of PSNP Interventions .......................................................................................................................... 60 Ethiopia: Bellmon Analysis - 2014/15 ii Self-Monetization ......................................................................................................................................... 62 Food/Cash Preferences ............................................................................................................................. 66 Logistics of Food Aid Distribution .................................................................................................................. 68 Port Capacity .................................................................................................................................................. 68 Transport ......................................................................................................................................................... 69 Storage .............................................................................................................................................................. 71 Bellmon Considerations ...................................................................................................................................... 72 Annex A: Study Areas ........................................................................................................................................... 75 Annex B: Questionnaires .................................................................................................................................... 84 Ethiopia: Bellmon Analysis - 2014/15 iii Acknowledgements The author would like to acknowledge the kind assistance of the Disaster Risk Management and Food Security Sector in facilitating this exercise. The staff of Save The Children, Relief Society of Tigray, Food for the Hungry, and the Catholic Relief Services also provided essential information and the benefit of their experience. This report would not have been possible without the considerable efforts made by the Agridev Consult survey team to collect the Rapid Rural Appraisal data from remote woredas. The results themselves reflect the patience of farmers and traders as well as other interviewees who kindly accepted to provide their time and to share the experiences that this report attempts to reflect. Table of Acronyms AGP Agricultural Growth Programme AISCO Agricultural Input Supply Company CPI Consumer Price Index CSA Central Statistical Agency DA Development Agent DRMFSS Disaster Risk Management and Food Security Sector ECX Ethiopian Commodity Exchange EFSR Emergency Food Security Reserve EGTE Ethiopian Grain Trade Enterprise ETB Ethiopian Birr FGD Focus Group Discussion FY Financial Year FSCD Food Security Coordination Directorate GoE Government of Ethiopia HICE Household Income Consumption and Expenditure Km Kilometer MEWIT Merchandise Wholesale and Import Trading Enterprise MOARD Ministry of Agriculture and Rural Development MT Metric Tonne NMA National Meteorological Agency PSNP Productive Safety Net Programme Qt Quintal RRA Rapid Rural Appraisal SFR Strategic Food Reserve SNNPR Southern Nations Nationalities and Peoples Region USAID United States Agency for International Development WFP World Food Programme Ethiopia: Bellmon Analysis - 2014/15 iv Executive Summary Objective. This study provides the information necessary for USAID to make an accurate Bellmon determination for an anticipated volume of 100,000 MT of Title II grains (wheat and pulses) for distribution through the Productive Safety Net Programme (PSNP). In order to do so, it describes relevant developments in the Ethiopian economy and provides an overview of the agricultural sector, including both production and marketing. It provides an overview of government policies affecting food security before assessing current levels of food availability as determined by the last Meher season (2014/15), the recent Belg season together with carryover stocks and food imports. It also considers the state of Ethiopian grain markets and recent price trends, with particular reference to price movements and market capacity in deficit areas. Current and anticipated levels of food security are assessed as well as the impacts of PSNP transfers of food and/or cash. Beneficiary preferences as to cash or food are discussed and recommendations made to mitigate the price risk associated with cash transfers. The port, transport and storage capacity available for the importation of the anticipated volumes of Title II commodities is assessed against requirements. In the light of all of the above, recommendations are made to facilitate the final Bellmon