MAIZE PRICES CONTINUE TO HIKE ON THE MARKET

Although maize prices in Malawi remained lower than in most eastern and southern African markets, a recent market survey indicates that the commodity’s prices in major markets in the country are almost double the minimum farm gate price.

The report on the country’s 26 retail maize markets which was carried by the International Food Policy and Research Institute (IFPRI) shows that retail prices in all markets except for Chitipa, Karonga and Rumphi are higher than K180 per kilogramme (kg) announced by the Ministry of Agriculture, Irrigation and Water Development in August this year.

Mulanje recorded the largest price increase (15 percent) at K300 per kg from K260 per kg at the beginning of the month while Nsanje recorded the largest price decline (11 percent) at K220 per kg from K247 at the beginning of the month.

Despite the largest decline, however, at K171 per kg, retail maize prices in Chitipa remained the cheapest of the markets surveyed.

Irrespective of the price increases, maize prices in Malawi remained lower than in most eastern and southern Africa markets, although prices in Malawi’s Lunzu and Mitundu markets were higher than the national average price of maize in Zambia just as prices in Mzuzu and Karonga were higher than on Safex, South Africa.

“The highest price was reported in Bujumbura, Burundi followed by Dar es Salaam, Tanzania, and Maputo, Mozambique. Safex, the main grain futures market in South Africa recorded the lowest retail [maize] price,” reads the report in part.

Recently, the Food and Agriculture Organizations (FAO) said given the current levels and the historical seasonal trends, prices could surpass K250 per kg before the harvest period in March 2020 and, consequently, resulting in an aggravation of food insecurity conditions.

Maize, as part of the food component, impacts the country’s economy given that it constitutes 45.2 percent in the Consumer Price Index (CPI), which is an aggregate basket of goods and services for computing inflation.

Available figures from the National Statistical Office (NSO) indicate that food inflation has risen from 13.7 percent in June to 14.2 percent in July, to 14.6 percent in August and 13.9 percent in September.

During the same period, headline inflation has moved from 9 percent in June, to 9.3 percent in July, 9.5 percent in August and dropped slightly back to 9.2 percent in September.

Grain Traders Association of Malawi President Grace Mhango earlier observed that the current situation is a reflection of speculative market which she said triggers price hikes and holding of maize by traders at different levels.

Minister of Agriculture, Irrigation and Water Development Kondwani Nankhumwa earlier said the increasing maize prices have been worsened by declining stocks from the previous season held by smallholder farmers, which resulted in increased demand for maize across the country.

This, he said, is in addition to the reduced maize production in the Southern African Development Community (SADC) region with neighbors such as Zambia, Mozambique, and Zimbabwe which also pushed prices as traders were trying to get hold of the grain hoping to exploit the international markets.