Afghanistan: Drop in fuel, food prices raises hope for food insecure

KABUL, 17 November 2008 (IRIN) - Food and fuel prices have declined slightly over the past month, prompting some to say this could bode well for the country's eight million chronically food-insecure people.

The average price of wheat flour - a staple in Afghanistan - is at least 3.4 percent lower in November than September, according to a publication by the Ministry of Agriculture called the Agricultural Commodities Price Bulletin (see

Wheat prices have seen a marginal but steady decline since May in all the provinces in line with the "decreasing trend of wheat prices on global markets", it said.

Wheat prices have fallen by up to 17 percent in global markets over the past few months.

According to a joint emergency appeal by UN agencies and the government, Afghanistan is facing a 36 percent reduction in domestic agricultural production. The government recently announced a two million tonne food deficit. It has decided to import about 250,000 tonnes of wheat from Pakistan and Kazakhstan, according to government officials.

Lower fuel prices

High fuel prices over the past few months have adversely affected food prices. Fuel prices are now coming down (a litre of petrol was US$1.12 and diesel $1 on 16 November in Kabul) but not fast enough, according to the government.

On 15 November it called on private vendors to sell fuel at a lower price or face fines or cancellation of business licenses.

"The government and representatives of the private sector have agreed to reduce fuel prices by at least four Afghanis [eight US cents] per litre [from 15 November]," Jawad Umer, a spokesman of the Commerce Ministry, told IRIN, adding that the government had opened eight fuel stations in Kabul where fuel was sold at lower prices than elsewhere.

Relief for millions

Over 60 percent of Afghanistan's estimated 26.6 million people spend most of their income on food. High prices and drought have pushed more than eight million of them into high-risk food-insecurity, aid organisations say.

Several aid agencies have warned about a possible hunger crisis this winter, so even a marginal decline in food prices could prove beneficial for millions.

"It's good news food prices have declined. We hope the trend will continue and food will become more available to ordinary people," said Ahmad Nasir, a government employee in Kabul who earns about $75 a month.

Some aid workers say even a significant price reduction should not lead to complacency as the availability of adequate food in all parts of the country will remain a challenge for a long time.