Maize prices up 47% since Bingu wa Mutharika’s death


The World Bank has revealed that maize prices in Malawi went up by 47 percent between April and July this year, adding up to increases in the cost of living among Malawians who are reeling with rises in other essential needs following the massive devaluation of the kwacha in May.

The bank also says prices of the staple have cumulatively increased by 174 percent between July 2011 and July 2012.

The World Bank’s Food Price Watch released on August 30 indicates that between April and July 2012, the sub-Saharan Africa region had the highest price increases in food and that Malawi was one of the countries that registered highest rates of increase in maize prices.

The report says Mozambique recorded the highest jump in maize prices at 113 percent, resulting from localized poor harvests, reported cyclones, and normal seasonal patterns, while Malawi’s 47 percent maize price hike is in part a reflection of high inflation.

“Annual nominal cereal prices remain higher than a year ago,” reads the report.

The bank also says in the report that prices of rice in Malawi in July 2012 were 90 percent higher than in July 2011.

The bank blames pockets of drought in some par ts of the country for reduced food production which has influenced rises in prices for most locally grown food items.

It observes that the droughts may have substantive economic, poverty, and nutritional effects.

“The impacts [of drought] can be transitory, permanent, and/or intergenerational,” says the World Bank, adding: “Simulations based on historical data in Malawi point to average losses of 4.6 percent of its maize production each year, and an economy wide loss of 1 percent of gross domestic product.”.

The Centre for Social Concern reported in its June 2012 commentary that the prices of maize had risen by an average of 19 percent in one month in four cities, with Blantyre topping the list at 73 percent.

“The food price rises come as a sharp shock to many families at this period of the year. One other shocking revelation is that the food price rises are not as universally distributed across the four cities.

“These have been unevenly distributed across different four cities, and a common concern is that even quite substantial rises in income might not be enough to keep up with the rising cost of living,” said CfSC.

“The worrisome aspect here is that the steep maize price increases, coupled with limited income-generating opportunities, will very likely lead to deteriorating purchasing powe r of poor households. As such, if the problem is the poor’s inability to purchase sufficient calories, then economic and social policies targeting the poor are warranted,” reads the CfSC report.

It advices the government, civic organisations and cooperating partners to embark on distribution of free foodstuffs to families at and below the poverty line to protect the most vulnerable families from starvation.

“The task is daunting, but one unacceptable response is doing nothing,” said CfSC.

It is acknowledged, however, that while the country has not produced in great supply to allow for cheaper prices, it has some in stock, making it able for government to influence lowering of prices by releasing some maize into the market.

“This would make the maize more accessible to people because the price would be lowered,” says CfSC

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