Posted on August, 3, 2023 at 10:03 am
The declining trends in international food prices are likely to reverse with the suspension of the Black Sea Grain Initiative (BSGI). The suspension has the potential to add further upward pressure on international and local food prices, while undermining the supply of key staples in countries heavily dependent on imports from the Black Sea ports. Ethiopia, Kenya, Somalia, and Sudan – where food security and nutritional status are already fragile – are likely to see the worst outcomes.
Staple food prices in most of the countries in Eastern Africa followed seasonal trends. Nevertheless they remained high due to currency depreciation, below-average harvests, constrained imports, and disruptions in trade flows. Food prices in Sudan are significantly above pre-conflict levels due to irregular supply, increased fuel costs, conflict-related high transaction costs.
South Sudan saw a significant increase in staple food prices due to spikes in fuel prices (leading to high transportation costs) and reduced trade volumes from Sudan. The price of sorghum increased by almost 180 percent between June 2022-2023 while beans prices more than doubled in the same reference period.
In the second quarter of the year, many currencies across Eastern Africa continued to lose their value against the U.S. dollar (USD), with South Sudan and Ethiopia recording the highest depreciation in the parallel market (down 51 and 28 percent, respectively).
As of June 2023, average pump prices stood at USD 1.4/L: 21 percent higher than the same month last year. The fuel crisis in Burundi eased in the second quarter of the year, but pump prices in June 2023 were still 15.4 percent higher than in June 2022. In Ethiopia, petrol prices/L went up by a staggering 88.3 percent between June 2022-2023. In South Sudan, petrol prices increased by 79.4 between June 2022-2023.
The cost of living across Eastern Africa continued to be high, with the annual inflation rate across the region averaging 12.5 percent in June 2023. Ethiopia and Rwanda continued to record double-digit annual inflation throughout the first quarter of the year. Official inflation rates for Sudan have not been issued since the outbreak of the conflict in April; however, they are expected to be above 200 percent by June considering the soaring food prices observed up to now.
Food prices remain high across Eastern Africa, with average food inflation at 16 percent as of June 2023. Rwanda, Ethiopia, Kenya, and Uganda continue to record double-digit food inflation.
As of June 2023, the average per capita monthly price of a local food basket reached USD 20 across the Region – representing a 32.5 percent increase from the same month last year. Compared to a year ago, the food basked more than doubled in South Sudan and it went up by 36.7 percent in Burundi and 34 percent in Rwanda. In the second quarter, South Sudan, Sudan, and Somalia recorded the most expensive food baskets in the region (USD 33.3, 31.4, and 28.1, respectively)\
Source: Relief Web