Honduras was the country most affected by Hurricane 'Mitch' in 1998, and some 250 000 people were still receiving food aid until June this year, when the country was hit by drought. The onset of dry spells in June adversely affected crops during the early stages of development. Severe losses are reported for some 28 000 farmers living in central and southern areas of the country. An estimated 42 000 hectares of maize were lost (20 percent of the total planted area), with an expected fall in production of 38 000 tonnes. Additionally, 20 000 hectares of sorghum and 8 000 hectares of beans were lost. The Government used its strategic reserves of maize and beans to improve market supply of basic grains, and the WFP has distributed over 1 000 tonnes of food among the drought affected population. Despite the drought damage, aggregate cereal production in 2001 is forecast to fall by only 2.6 percent from last year's slightly below average crop, provided a normal second season crop is obtained.