Food Security Information Note NISA - Apr 2009: Market flows normalize
Good harvests in the region and commercial imports are ensuring a more than adequate market supply. Market grain supplies are relatively good. Trade networks are running smoothly compared with last year when restrictive measures imposed on subregional trade created major disruptions. This year, there is a brisk trade in millet and sorghum between Niger and Nigeria, as compared to last year's erratic market flows. There is also a growing volume of cross-border trade in other crops, such as groundnuts, in the western basin, along with an intensification of last year's uninterrupted, smooth flow of trade in tubers and cassava meal. However, cowpea exports from Niger to Nigeria have been « unofficially » suspended to enable the government of Niger to ensure necessary supplies for procurement of these crops under its so-called « Operation Cowpea », designed to boost producers' incomes in Niger through targeted government procurement at better prices.
Even with good crop availability and adequate market supplies, April prices were still quite high. Moreover, after a reportedly small dip in prices back in February of this year, prices on most markets have stabilized at rather high levels. This could be attributable, in part, to a faltering demand for imports in Nigeria and Ghana. This same lull in demand is also affecting livestock prices in Niger.
Rice prices are also stable despite the implementation of control measures for maximum axle loads in WAEMU countries. Market prices for rice in Guinea Conakry are down sharply with large-scale importers ensuring regular domestic market supplies, which have been further boosted by the government ban on rice exports.
Thus, the unusually low market supplies reported in late 2008 and early 2009 in the midst of the harvest season were due partly to the wait-and-see attitude of farmers holding out for more attractive prices and have steadily grown and improved since February of this year. Right now, supplies are visibly better than at the same time last year, strengthened by falling international market prices for both rice and wheat. The per-ton export price of broken rice from Thailand in April of this year had fallen by nearly 40 percent from the same time last year.
These supply and export price dynamics kept prices for certain grains grown across the region stable and, in some cases, trending downwards throughout January and February of this year on certain markets in certain countries. This is especially true of millet and corn prices in Niger. On the whole, grain prices in April of this year were up by anywhere from 3 to 12 percent from the same time last year and running 20 to 35 percent above the five-year average.