Conflicts, weak currency worsen hunger in poor nations – FAO

Food security - WB

Penang, 16 Nov (Kanaga Raja) — Persisting and intensifying conflicts are the key drivers of the severest levels of acute food insecurity, and despite declining international prices, weak currencies in many low-income countries are sustaining high domestic food prices and hampering households’ access to food, the United Nations Food and Agriculture Organization (FAO) has said.

In its latest Crop Prospects and Food Situation report, FAO said that a total of 46 countries around the world, including 33 in Africa, ten in Asia, two in Latin America and the Caribbean and one in Europe, are in need of external assistance for food.

FAO said that in Palestine (a new entry to the list), a total of 1.5 million people (28 percent of the population) were estimated to be in acute food insecurity and needing immediate assistance between May and July 2022, namely 1.2 million people in the Gaza Strip and 353,000 people in the West Bank. This equates to 53 percent of Gaza’s population and 11 percent of the population of the West Bank.

The escalation of the conflict in October 2023 is likely to increase humanitarian and emergency assistance needs, while access to the affected areas remains a concern, it added.

FAO cautioned that the spillover effects from the conflict could worsen food insecurity in Lebanon.

According to the FAO report, the 33 countries in Africa in need of external assistance for food are Burkina Faso, Burundi, Cameroon, Central African Republic, Chad, Congo, Democratic Republic of Congo, Djibouti, Eritrea, Eswatini, Ethiopia, Guinea, Kenya, Lesotho, Liberia, Libya, Madagascar, Malawi, Mali, Mauritania, Mozambique, Namibia, Niger, Nigeria, Senegal, Sierra Leone, Somalia, South Sudan, Sudan, Uganda, United Republic of Tanzania, Zambia, and Zimbabwe.

The ten countries in Asia in need of external assistance for food are Afghanistan, Bangladesh, Democratic People’s Republic of Korea, Lebanon, Myanmar, Pakistan, Palestine, Sri Lanka, Syrian Arab Republic, and Yemen.

Haiti and Venezuela in the Latin America and the Caribbean region, as well as Ukraine in Europe are also in need of external assistance for food.

REGIONAL REVIEWS

According to FAO, in the Africa region, with harvesting of the 2023 cereal crops still to be finalized in some countries, total cereal production (rice in paddy terms) in Africa is forecast at 214.2 million tonnes, 1 percent above the five-year average.

In the sub-region of North Africa, the report said all countries in the sub-region rely heavily on wheat imports to cover their domestic consumption needs.

It said that reflecting a below average 2023 output, the sub-region’s aggregate cereal import requirement, of which wheat accounts for about 60 percent, is forecast at 50 million tonnes in the 2023/24 marketing year (July/ June), 2 percent above the five-year average and 7 percent above the previous year’s level.

“The expected year-on-year increase is driven by lower stock levels and consequent efforts by local authorities and traders to boost reserves as a way to dealing with future market shocks.”

The actual level of imports is likely to be negatively affected by the weakness of currencies in many countries of the sub-region, said the report.

Across the sub-region, with the exception of Libya, year-on-year food inflation rates remained at high levels in the third quarter of 2023, reflecting the delayed transmission from international commodity prices that, with the exception of rice and sugar, declined from their peaks of early 2022 and weak national currencies vis-a-vis the United States dollar.

In Egypt, where a large share of unsubsidized products, such as protein sources and perishable fresh foods, has a large weight in the consumer price index, the inflation rate increased from single digits in the last quarter of 2021 to 48 percent in January 2023, and surged to 74 percent in September 2023.

In Morocco, the annual food inflation rate increased from single digit values in early 2022 to a record high of 20.8 percent in February 2023 and then it gradually decreased up to 10.6 percent in August 2023, said FAO.

In Tunisia, in September 2023, the annual food inflation rate reached a level of 13.9 percent, showing a slight decline from the record level of 15.9 percent in May 2023.

In Algeria, food prices increased by 13.9 percent year-on-year in August 2023, a decline from the record level of 17.3 percent in June 2022, said the report.

“In Libya, the annual food inflation rate in July 2023 registered 3.36 percent, the lowest level in the sub-region owing to a widespread use of consumer subsidies.”

In the sub-region of West Africa, the report said that the prices of coarse grains were higher year-on-year in most countries.

In Ghana, prices of sorghum, millet and maize in August 2023 were between 35 and 70 percent above their year earlier values.

The depreciation of the Ghanaian cedi, high international commodity prices and transport costs, are key factors driving food prices higher, it added.

It said in Nigeria, prices of millet, sorghum and maize rose by 60 to 100 percent between May and August, and were 80 to 130 percent higher on a yearly basis, reflecting conflict-related market disruptions and a loss of value of the naira.

Higher transport costs, following the removal of a fuel subsidy in May 2023, also contributed to pushing prices up. Moreover, these high fuel prices spilled over into Benin, reflecting the large informal imports of fuel from Nigeria, the report added.

“The resulting increase in transport costs contributed to pushing up already elevated sorghum and maize prices between June and August, when they were up to 25 percent higher year-on-year.”

In the Niger, prices of millet and sorghum rose by 10 to 45 percent between June and September, with seasonal trends exacerbated by reduced supply due to sanctions imposed by the Economic Community of West African States following the military takeover in July 2023, including the suspension of economic and commercial transactions, and the closure of borders with Benin and Nigeria, key sources and transit areas for imported food.

FAO said prices of millet and sorghum were up to 15 and 35 percent, respectively, above their year earlier levels last September.

However, in both Mali and Burkina Faso, prices of sorghum and millet were 15 to 40 percent below their very high year earlier levels.

The report said according to the March 2023 “Cadre Harmonise” (CH) analyses, at the sub-regional level, about 42.5 million people faced acute food insecurity during the June to August 2023 lean period, up from the 38.3 million people that were acutely food insecure during the same period in 2022.

It said whilst conflicts and economic challenges are the key drivers of the increase in acute food insecurity, the worsening situation in part reflects an expansion in the geographical coverage of the CH analyses in 2023.

The report said worsening conflicts and persisting civil insecurity drove high levels of acute food insecurity in the Liptako-Gourma Region, the Lake Chad Basin and northern Nigeria. Non-state armed groups (NSAGs) continued to expand their presence in Burkina Faso and Mali, triggering further population displacements and disrupting trade and agricultural activities.

In Burkina Faso, 3.4 million people were estimated to be acutely food insecure, including 605,000 people in CH Phase 4 (Emergency) and 42,700 people in CH Phase 5 (Catastrophe) in Boucle du Mouhoun and Sahel regions, marking the highest figure of people in catastrophic conditions ever projected for the country, said FAO.

In Mali, 1.3 million people faced acute food insecurity, including 76,000 people in CH Phase 4 (Emergency) and 2,500 people in CH Phase 5 (Catastrophe) in Menaka Region.

FAO said that this was the first time that the country had populations estimated to be in catastrophic conditions.

“Insecurity is expected to deteriorate with the withdrawal of the United Nations Multidimensional Integrated Stabilization Mission in Mali (MINUSMA) by the end of 2023,” it cautioned.

FAO said in Nigeria, 24.8 million people were acutely food insecure, including 1.1 million people in CH Phase 4 (Emergency).

“Northern areas registered a spike in violence against civilians in recent months, partially driven by worsening macroeconomic conditions across the country.”

Slow economic growth, currency depreciations and high inflation rates, particularly in Sierra Leone, Ghana, Nigeria and Gambia, are also having a negative impact on households’ purchasing power and consequently constraining food access, it added.

In the sub-region of Central Africa, FAO said in Cameroon, the Central African Republic and the Democratic Republic of the Congo, the prices of imported food commodities, such as rice, wheat flour and vegetable oil, remained at high levels in the third quarter of 2023 compared to the previous year.

According to the International Monetary Fund (IMF), the average annual inflation rates in 2023 are expected to increase moderately year-on-year in Cameroon, the Central African Republic and the Republic of the Congo.

In contrast, inflation rates are forecast to decline slightly in the Democratic Republic of the Congo and Gabon.

About 30.8 million people are estimated to be facing severe acute food insecurity in the Democratic Republic of the Congo, Cameroon and the Central African Republic, about one-quarter of the aggregate population.

Ongoing conflicts continue to cause population displacements and widespread disruptions to agricultural and marketing activities, a key cause underlying the high prevalence of food insecurity, said the report.

“In addition, households’ purchasing power has been significantly reduced by the high prices of staple foods.”

In the sub-region of East Africa, the report said in the Sudan, prices of main staples, sorghum and millet, surged by up to 60 percent between April and August 2023 due to trade and market disruptions caused by the conflict, reaching new record highs.

The report said prices were also supported by a difficult macroeconomic situation, resulting in high prices of fuel and agricultural inputs that pushed up production and transport costs.

In South Sudan’s capital, Juba, prices of maize and sorghum increased by 15 and 20 percent between April and June 2023, as the national currency depreciated on the parallel market, it added.

“Subsequently, prices remained mostly stable between June and September as the exchange rate remained firm.”

The report said prices of maize and sorghum in September were at exceptionally high levels, 27 and 12 percent, respectively, up from the already high year-earlier values, mainly due to protracted macroeconomic challenges and insufficient domestic supplies.

In Ethiopia, prices of locally produced maize increased by 20 to 55 percent between January and August 2023, reaching record levels.

It said the continuous depreciation of the national currency and consequent imported inflationary pressure is a key factor driving up prices, amplifying normal seasonal patterns.

The report also pointed to the dire food insecurity situation in the Sudan due to the ongoing conflict.

It said in the Sudan, the conflict that broke out in mid-April 2023 has severely disrupted livelihoods, paralyzed economic activities and triggered large-scale population displacements.

About 20 million people, over 42 percent of the population, were estimated to require emergency food and livelihood assistance in 2023, it added.

The food security situation is not expected to improve substantially during the harvest period, between October 2023 and January 2024, as the conflict continues to hamper physical and economic access to food, reflecting market disruptions and high prices, said FAO.

In Somalia, northern and eastern Kenya and southern Ethiopia, the current dire food security situation is mainly a consequence of the prolonged drought between late 2020 and early 2023, which caused consecutive failed crop harvests and widespread livestock deaths.

FAO said favourable March to June 2023 rainy seasons marked the end of the drought and resulted in a decline of the prevalence and severity of food insecurity compared to the peaks reached in early/mid-2023.

In the sub-region of Southern Africa, the report said prices of maize reached record levels in Malawi and Zambia in September, as currency weakness continued to support rapid price growth.

Reduced domestic supply in Malawi and strong export demand for Zambian maize have also contributed to the price spikes in 2023, it added.

It said in Zimbabwe, following a short period of disinflation, food price rises quickened in September, pushing the inflation rate to 23 percent, amid a moderate depreciation of the national currency.

“Prices of maize meal, the key national food staple, were more than four times higher in September compared to the year-earlier values.”

In Malawi and Namibia, acute food insecurity conditions have worsened notably compared to the previous year, with the number of food insecure people (IPC Phase 3 [Crisis] levels and above) increasing to 4.4 million (15 percent higher) and 0.7 million (78 percent higher), respectively, said the report.

These increases are largely attributed to localized shortfalls in production and high inflation rates. In Lesotho and Eswatini, small increases in acute food insecurity levels were projected in 2023/24, due to the high cost of living, whilst persistent double-digit inflation rates and weak economic growth are key factors driving food insecurity in Zimbabwe, where an estimated 3.5 million people are in need of urgent humanitarian assistance.

Looking further ahead, the report said the anticipated adverse effects of El Nino pose a heightened risk for food insecurity.

It said that concerns mostly relate to the poor production outlook, and the potential ramifications that reduced harvests would have on food availability, as well as food access due to losses of income for rural households.

In addition, production downturns could trigger supply related price spikes across the sub-region and curb import availabilities, particularly if production declined in South Africa, it added.

As for the Asian region, FAO said that total regional cereal production (rice in paddy terms) is pegged at a well above-average level of 1,502 million tonnes in 2023.

This forecast is largely driven by sizeable production upturns in Far East Asia, mostly concentrated in the leading producers China (mainland) and India, reflecting area increases, it added.

In the sub-region of the Far East, the report said domestic retail prices of rice, the sub-region’s main staple food, increased in most countries of the sub-region and, last September, they were significantly up year-on-year.

The report said in Thailand and Viet Nam, the main exporting countries, rice prices last September were between 40 and 50 percent above their year-earlier levels, on expectations of strong international demand from reduced exports from India.

“In Pakistan, prices of wheat flour, a key staple food, declined slightly between July and September 2023, due to the increasing market availability from the 2023 above average harvest, but prices were still about 70 percent higher year-on-year in September, mostly reflecting high agricultural input costs and inflationary pressure.”

High food prices and reduced incomes, due to economic downturns, have diminished the purchasing power of vulnerable households, limiting their access to food. This is the fundamental driver of acute food insecurity in several countries of the sub-region, the report emphasized.

It said in Pakistan, according to the latest IPC analysis, the number of people facing high levels of acute food insecurity (IPC Phase 3 [Crisis] and above) between November 2023 and January 2024 is projected at 11.8 million, compared to 10.5 million people in the April to October 2023 period.

In the sub-region of Near East, FAO said in countries experiencing difficult socioeconomic circumstances due to conflicts or economic crises, including Afghanistan, Lebanon, the Syrian Arab Republic and Yemen, farmers’ access to inputs remains constrained by the lack of liquidity and high prices of generally imported inputs, which is expected to have a negative impact on the extent of the area planted and yields.

It said lingering conflicts, elevated international commodity prices, particularly for rice and sugar, economic downturns and reduced livelihood opportunities continue to have a significant impact on acute food insecurity levels in many countries of the sub-region.

The report said that in Afghanistan, according to the latest IPC analysis, approximately 15.3 million people (35 percent of the population analysed) were projected to face severe acute food insecurity (IPC Phase 3 [Crisis] and above) between May and October 2023, including about 2.8 million people in IPC Phase 4 (Emergency).

It said in Lebanon, according to the latest IPC analysis, about 2.3 million people (42 percent of the population analysed), including 1.5 million Lebanese residents and 800,000 Syrian refugees, were projected to face IPC Phase 3 (Crisis) or worse conditions, including 354,000 in IPC Phase 4 (Emergency), between January and April 2023.

The situation is mainly due to the multi-faceted crisis that the country is facing and it is likely to worsen due to the spillover effects from the conflict in Israel and Palestine, it added.

In the region of Latin America and the Caribbean, the report said total cereal production is forecast at an all-time high of 300.2 million tonnes (rice in paddy terms) in 2023. This large output principally reflects a record maize out-turn in Brazil, underpinned by a substantial increase in maize plantings, as well as high yields.

FAO said according to the latest Integrated Food Security Phase Classification (IPC) analysis, the number of acutely food insecure people requiring urgent humanitarian assistance between September 2023 and February 2024 is estimated at 3.1 million in Guatemala, marginally down compared to the previous year.

It said in Guatemala, El Salvador, Honduras and Nicaragua, WFP estimates that the food security and nutrition situation of about 1.6 million people are likely to be affected by drought conditions associated with the El Nino phenomenon.

In Haiti, about 4.3 million people (44 percent of the analysed population) are estimated to experience high levels of acute food insecurity between August 2023 and February 2024, lower than the corresponding period in 2022/23, when violent protests affected the mobility of people and commodities, and access to essential services.

However, it said despite the slight year-on-year improvement, the food security situation continues to be severely affected by macroeconomic difficulties, the decline in domestic food production and widespread gang violence.

It said as of August 2023, the number of refugees and migrants from Venezuela were estimated at 7.7 million people, as a result of the severe and prolonged macroeconomic crisis in the country.

After a partial recovery in 2021 and 2022, the economy is expected to contract in 2023. The largest groups of Venezuelans are located in Colombia (2.89 million), Peru (1.54 million), Brazil (0.48 million), Ecuador (0.47 million) and Chile (0.44 million), it added.

As for the North America, Europe and Oceania region, the report said that about 17.6 million people are in need of humanitarian assistance in Ukraine.

According to the 2023 Humanitarian Needs Overview, about 17.6 million people are estimated to be in need of multi-sectoral humanitarian assistance in 2023.

It said as of late May 2023, about 5.1 million people were estimated to be displaced in the country, with about 73 percent of Ukrainian refugees recorded in European countries. – Third World Network