Maize prices drop wanes, falls by nine percent
Maize prices continued to fall in June, but the decrease has slowed as most farmers completed the harvest of the staple.
According to the Famine Early Warning System Network (Fewsnet), the price of maize dropped by nine percent in June, dropped by 11 percent in the month’s first two weeks, after falling by 16 percent in May.
The Fewsnet July report has noted that although maize prices dropped in June, it continues to be 60 percent above the five-year average while prices are expected to rise between July and December. The prices will, however, be lower than those recorded during the same period last year.
The slowing down in the fall of maize price may have a bearing in the fall of inflation—the general rise in prices of goods and services—whose composition is dominated by food accounting for about 52.1 percent.
Inflation fell by only 0.1 percentage point to 22.5 percent in June, according to the National Statistical Office (NSO), creating fears that the Consumer Price Index (CPI) might start rising soon.
However, Fewsnet notes that currently, most areas in Malawi are generally experiencing favourable food security conditions and nearly all but a few districts are reporting that about one percent of households do not have staple food from their own production.
The network further notes that the country is expected to have 1.5 million tonnes of surplus maize based on official estimates.
Estimates by the Ministry of Agriculture, Irrigation and Water Development indicate that this year’s maize production is approximately nine percent higher than the previous season and 12 percent higher than the five-year average.
The July report also notes that there is an increase in maize imports especially from Mozambique through Muloza Border that is being driven by lower prices on the Mozambique side.
According to available figures, on average, maize from Mozambique is being purchased for about K64 per kilogramme (kg) compared to K71 per kg on the Malawi side.
The report also notes that informal exports in June remained low at 415 tons compared to exports in May 432 tons with almost all informal exports being recorded at the Songwe and Mbirima border points into Tanzania.
Reports indicate that Admarc and the National Food Reserve Agency (NFRA) have not yet started to purchase maize this season and no planned procurement of maize has been announced.
