GOVERNMENT’s Tripartite Agreement between the Food Reserve Agency (FRA) and selected millers to reduce mealie meal prices has failed to yield the desired results, says the Indaba Agricultural Policy Research Institute (IAPRI).
And IAPRI says the 2019/2020 agricultural season is the fourth consecutive period in a row where Zambia experienced the Fall Army Worm (FAW) infestation, with Southern Province the worst affected.
Meanwhile, IAPRI says that the COVID-19 pandemic is likely to induce further hardships, especially on the poor and vulnerable households, due to an interruption on food systems amid border closures.
In a Food Security Status Report for the first quarter of 2020, released this month, IAPRI stated that government’s Tripartite Agreement between the FRA and selected millers, through the Millers Association of Zambia (MAZ), to reduce mealie meal prices failed to reduce prices of the staple food.
Last November, the FRA, Grain Traders’ Association of Zambia (GTAZ) and selected millers signed a Tripartite Agreement where the FRA and GTAZ blended their stock and supply to millers at a subsidised price, with the expectation that millers would pass on the subsidy through an agreed reduced mealie meal price to consumers.
However, the national average mealie meal prices had shot up to an all-time high of K168.15 per 25Kg breakfast bag last month compared to K96.09 just 12 months prior, according to Zambia Statistics Agency (ZSA) data.
“Of the over 71,000MT FRA committed to supply through the Tripartite Agreement, about 56,000MT was reported to have been released at the time of writing this report. Millers, who are not part of the Tripartite Agreement, continue to source their maize from traders at the market price and hence could not sell mealie meal at the government recommended price of ZMW136 for breakfast meal and ZMW131 for roller meal as the upper-limit. This signals that the government’s effort to try to contain maize meal price increases through subsidized maize grain prices to selected millers has not been effective to reduce the general mealie meal price increase,” IAPRI stated.
“The Tripartite Arrangement between government through FRA, MAZ and the GTAZ on average helped to cushion the price increase in major retail chain stores such as Shoprite, but was inadequate in terms of stabilizing the mealie meal prices across the other market channels because not all millers in the country could participate in the programme. Also, channelling the limited commercially available stocks to only selected millers meant that the rest of the millers and consumers had to rely on other more expensive or rather unsubsidized stocks. This further demonstrates the ineffectiveness of targeting a select number of millers to cushion consumers from rising prices. The impacts of distributing breakfast meal as relief food is yet to be accessed.”
It noted that subsidizing only a selected few millers’ input costs was not an efficient use of public resources.
“Subsidising all consumers through a general subsidy to selected millers is not an efficient use of public resources because this diverts limited resources from those who really need the assistance. Hence, as an alternative, the government should always prioritize targeted relief efforts through a combination of strategies, including community sales and emergency Social Cash Transfer to those who really need assistance. This will ensure that limited public resources go to where they are needed the most,” IAPRI stated, who, however, noted that maize supply during the forthcoming 2020 crop marketing season was likely to improve as a result of early planting,” IAPRI stated.
And IAPRI stated that the 2019/2020 agricultural season saw another infestation of army worms and the African Army Worms (AAW) in other areas.
“The agricultural 2019/2020 agricultural season is the fourth agricultural season in a row that Zambia is experiencing FAW infestations. The AAW and FAW status report further shows that FAW infestations, in contrast to AAW attacks, have been reported in all provinces. In absolute terms, the infested area was highest in Southern Province with 74,447 Ha of 397,270 Ha planted affected, followed by Central Province with 43,260 Ha of 342,260 Ha planted, and then Eastern Province with 40,869.55 Ha of 717,085.14 Ha affected,” IAPRI stated .
“About 15.3 per cent of the estimated 1,922,051 hectares planted to maize was reported to be affected by AAW and FAW. Western Province recorded the highest infestation rate with all of the reported planted area of 37,563 Ha affected. Lusaka, Luapula and the Copperbelt followed with 44.5 per cent, 39.7 per cent, and 39.5 per cent, respectively. Provinces in the northern region were the least affected.”
Meanwhile, IAPRI, the agro-focused think-tank and agricultural policy research and outreach institute, stated that the COVID-19 outbreak will negatively impact the poor and vulnerable households.
“COVID-19 global pandemic is likely to induce further hardship, especially on the poor and vulnerable households because of interruption on food systems, prices and income through border closures, movement restrictions and increased demand for food through potential hoarding by some. However, it may be too early to know the full extent of the pandemic on the food security status of the country. More of the potential impact of the pandemic will be covered in the April –June Food Security Status Report,” stated IAPRI.