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Pressure mounts on food prices

By Taonga Sabola:

Pressure has started mounting on the country’s staple food, maize, as Malawi passes through the lean season, a snap survey by The Daily Times has established.

The development, if left unchecked, threatens to exert pressure on inflation which rose to 10.1 percent in November 2018.

A visit to selected produce markets in Blantyre on Tuesday revealed that a 50kg bag of maize was selling at an average price of K10,000 up from K7,500 in November.

Morris Butao, a maize vendor at Zingwangwa Market, attributed the upsurge in maize prices in recent weeks to the seasonal shortage of the commodity around the months of January and February.

He said, traditionally, maize prices tend to rise around January and fall in March when harvesting starts.

“I would say it is a seasonal effect. Supply of the commodity in areas where we get it normally falls during these months,” Butao said.

Jane Chiundira, a vendor in Chirimba, attributed the rise in food prices to the onset of the rainy season which has made many earth roads in maize-producing areas impassable.

She said the development has increased the cost of transporting maize to markets.

“Again, during this period, demand for the commodity tends to go up as most small-scale farmers are left with no maize stocks,” Chiundira said.

Elevated prices were also recorded on other food items such as rice.

But the Agricultural Development and Marketing Corporation (Admarc) Wednesday said Malawians need not to worry as it has in stock plenty of maize.

Admarc spokesperson, Agness Ndovi, said the State-owned grain marketer is selling maize in its markets at K150 per kg or K7,500 per 50kg bag.

Ndovi said satellite markets could also be opened in areas far from designated markets on the request of communities.

In its November 2018 economic report, portfolio management and advisory firm, Nico Asset Managers, said the impact of the lean season could be moderated by humanitarian assistance.

It adds that the tight monetary policy adopted by the Reserve Bank of Malawi would help dampen inflammatory pressures.

Food is the major contributor to the Consumer Price Index at around 45 percent. The development means any significant shortages of the commodity has an impact on inflation.

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