Friday, January 21, 2011

Food Crises in Africa

Minot of IFPRI researched the transmission of the 2007/08 global food price crisis to African food prices in 12 countries. African food prices increased about 63%, with significant variation - much larger in Malawi, smaller in Uganda for instance. With a more concentrated set of prices, about half of the rice prices moved significantly with global food prices but most other food prices did not respond significantly over the longer term. He hypothesizes three factors that would influence this: the size of the shifts, the importance of oil prices in the crisis, and local policy factors. "In general there isn't a strong relationship between African prices and world market prices" and any connections are stronger for wheat and rice than other commodities.

The Tunisian revolution is unusual for many reasons. One is just that revolutions are unusual in Africa. A second is that it does not appear that the revolters have anyone in mind they would like to put in power; they're just kind of against whoever takes the reins at the moment. A third is that there is a wide variety of reasons given by the protestors, including responses to high food prices but that isn't the first thing being mentioned in most stories. A fourth is that Tunisia also appears to be unusual when compared with other Arab states, Cowen's principle mention being that there are significant policy areas they get right, like clean water provision.

Food prices are rising fast in Cote d'Ivoir:
In the northern city of Odienné and in Gagnoa in central Côte d’Ivoire, before the election crisis a kilogram of sugar cost the equivalent of about $1.25. It now costs $2.40; and the same goes for a litre of cooking oil. A sack of rice now costs around $35 in Odienné and the centre-north city of Korhogo; families could buy the same sack before the political crisis for around $26. In Abidjan [the capital] a kilogram of meat cost $2.80 before; now prices range between $4.40 and $5. ...
In Abidjan’s wealthier neighbourhood of Cocody, Fatim Touré [food retailer] sat waiting for clients. “Many people just turn around when I tell them the prices,” she told IRIN. “But it’s not the vendors’ fault; with this crisis, hauliers are charging more for moving vegetables into Abidjan.” She said a sack of aubergines which used to cost her $20, now cost $26.
Cooking fuel is costing families more: In Abidjan a 12-kg bottle of propane gas that went for about $9, now costs about $13. A market vendor in Gagnoa told IRIN charcoal there used to be $10 a sack; now it’s double that. ...
Higher-income families in Abidjan are able to keep extra food at home just in case of further unrest. Some said the most significant impact for now is that they feel confined to their homes. “Every week we stock up at the supermarket, just in case,” bank executive Bertrand Comoé said. “I don’t allow the children to be out after 6pm. Everyone is home by that hour; it’s like a prison. It’s stressful, but we have to do what we can to avoid the worst.”
And let's not forget the role of BLOOD CHOCOLATE in Cote d'Ivoir's current political struggles.

FAO happily announces that Niger's food production is up 60% over last year and that the livestock that survived last season's drought are now well-pastured.  The people, however, not so much. Malnutrition and food insecurity are still quite high. "FAO/WFP called for an improvement in family purchasing power in Niger by assisting pastoralists to replenish their livestock and boosting off-season agriculture such as vegetable and roots and tubers production."

The Africa News Blog is concerned that drought could seriously hamper Kenya's economic growth (6% last year), ability to provide electricity, and political stability.

I think speculators get a bad rap and speculation is a stabilizing impact on commodity prices. The easiest illustration of this comes from the price of onions. Onion futures trading was banned in 1958 at the behest of then-congressman (later president) Gerald Ford who felt speculators were engaged in price manipulation. The result is that onions are one of the most unstable commodities out there:

And for a food crisis of a different kind: for authentic African cuisine in Dubai, there's just one place to go: Tribes, serving authentic African BBQ and burgers, accompanied by authentic music: Wakka Wakka.  Hoo boy.

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