Escalating maize prices hit Malawians hard

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By Earlene Chimoyo

 

Malawians begin the year 2020 on empty stomachs as prices of maize rise beyond the reach of many.

Spot-checks by Capital FM have found that the cost of a kilogram of maize is now selling at an average MK330 in most private trader markets.

The development comes at a time the Malawi Vulnerability Basement Committee report also indicates that some part of the country will experience hunger and are in need of relief aid.

The country’s middle to low income earning households will have to struggle to earn a meal following the continued sharp rise in maize prices.

In just a matter of weeks, the price keeps moving up at intervals of over MK10.

A 50 kilogram bag of maize is the per capita measure of food locally.

One would be tempted to believe that a majority of the people in the two classes can all afford to purchase the grain at that price, but no.

For example, to buy a 50 kg bag, one has to part ways with a minimum MK17, 000, but in other areas it has gone as high as MK19, 000.

But most of these people can normally go for 25 kg, or smaller portions.

This is also against the shortage of the grain which this group of people can afford, the ADMARC Maize and produce.

At the public grain trader, the prices are still at a MK150 per kg, totaling MK7, 500 per 50 kg.

Most ADMARC depots however do not have enough stocks.

This is likely to mean that a majority will have to be affected by hunger this lean season which is creating doubts over the MVAC figures which predicted a drop in the number of those to be affected.

Further, this kind of pricing is likely to increase inflationary shocks.

Inflation has maintained at a single digit since the beginning of 2019, and it even went as low as 7 percent somewhere along the year, but the upward trajectory started manifesting itself from midyear.

This now starts posing a threat to the economy, as inflation has now gone back to double digit, standing at 10.4 percent, from 9.2 percent in the last quarter of 2018.

Food inflation now stands at 17.2 percent while Non Food Inflation is at 4.7 percent.

This then means the cost of living is also going to shoot.

Retailers will be pushed to hike prices of basic goods and services.

Minister of Finance, Joseph Mwanamvekha however remains confident that this is just a phase, and it will definitely pass.

As much as Kambewa agrees with Mwanamvekha that this is just a phase, he is quick to speculate that such hunger situations are mostly created deliberately by private traders so as to cash in on the maize when it becomes scarce.

Meanwhile, the government is expected to start importing maize to fill in the gaps at its ADMARC depots following the poor response by private traders to sell maize in their possession to the public grain Marketer.

In the meantime, stampedes, at ADMARC depots will continue, and private traders on the other hand will also continue to make supernormal profits from their grain stocks until the next harvest which is roughly in the next 4 months.

 

 

 

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