Informal maize exports continue to rise—report

Despite an existing maize export ban, looming hunger and elevated prices, higher prices continue to push up informal maize exports, Femine and Early Warning Systems Network (FewsNet) Food Security Update has shown.

Figures from FewsNet show that between August and November 2019, Malawi has exported about 6 200 metric tonnes (MT) of maize with most of the grain entering Tanzania, where it is being re-exported to other east African countries, including Kenya and the DRC.

For instance, at 1 018MT, maize exports in November were about 56 percent above the five-year average while between August and October 2019, maize export volumes were fairly stable at well above-average levels of around 1 700MT per month.

Informal maize imports on the other hand continue to be below average, with figures indicating that an estimated 907MT of maize grain was informally imported in November, mainly from Mozambique.

This was attributed to national production deficits in neighboring countries, especially in Zambia and Mozambique, and higher prices being offered elsewhere in the region.

 In an earlier interview, Grain Traders and Processors Association of Malawi indicated that demand in the region is also high with Kenya looking for 1.2 million MT, Zimbabwe 775 000MT and DRC 600 000MT.

The association’s president Grace Mhango said rule of demand and supply is taking its course.

The maize export ban, according to the Ministry of Agriculture, Irrigation and Water Development, was imposed to ensure that the country stocks adequate supplies for the strategic grain reserves.

Export restrictions on staple foods or cash crops are frequently imposed in developing countries to promote food security or industrial development goals.

A study by the International Food Policy Research Institute (Ifpri) revealed that a maize export ban imposed after the 2016/17 harvesting period cost Malawi K69 billion in potential export revenue as wholesale maize prices in the country were said to be between 45 and 70 percent lower than in Kenya, Rwanda and Tanzania within the period.

Agricuture expert Tamani Nkhono-Mvula yesterday said that export bans are only applicable in charted routes, observing that much of the maize in Malawi gets out of the country using informal and uncharted routes.

“All in all, export bans are not a solution to the issue of maize exportation, the solution is to make maize trade profitable in Malawi, to provide a disincentive for illegal exports.

“Selling a bag of maize at K20 000 at this point in time is a bit inhuman and it shows the failure of authorities to stabilize the prices,” he said.

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