Maize prices slowly easing

The average price of maize is slowly easing with freshly harvested maize coming onto the market, particularly in the Southern Region as transport links severed by Tropical Cyclone Freddy are being restored.

But Consumers Association of Malawi (Cama) yesterday  feared the low prices will be short-lived due to several factors.

A Business News snap survey in some of the selected markets in Blantyre, Thyolo, Phalombe and Mulanje shows that maize prices have declined by 34 percent from about  K41 000 in mid-March this year to around K27 000 per 50 kilogramme (kg) bag at the start of this week.

The price is K2 000 above the government’s recommended minimum price of K25 000 per 50 kg bag and is more than twice the price that prevailed during the same period last year, which averaged of K10 200 per 50 kg bag.

But speaking in an interview yesterday, Cama executive director John Kapito feared that the prices will sustain for a long  period as the country registered poor harvest due to inadequate farm inputs under the Affordable Inputs Programme, high fertiliser prices and the impact of Cyclone Freddy that hit the country in mid-March.

He said: “It’s obvious that prices will soon rise and our warning to families that are selling their maize now is that they don’t have to sell all the maize.

“This year, maize will be more expensive as we get into the lean period.”

Kapito said this year’s lean period will probably come between June and July compared to the usual October.

National Smallholder Farmers Association of Malawi chief executive officer Betty Chinyamunyamu in an interview yesterday called on government to step in to contain the maize price increases.

She said: “Firstly, government needs to provide financing to Agricultural Development and Marketing Corporation in good time so that they can go on the market and start buying the maize.

“Secondly, government needs to control informal cross-border trade to stop any illegal exports.”

Speaking separately, Blantyre-based Rhoda Makawa, a single mother of two, said she is failing to take advantage of the declining prices due to lack of disposable income.

“I can only hope that these prices will be sustained up to October this year,” she said.

Commenting on whether the decline could affect monetary policy, Malawi University of Business and Applied Sciences associate professor of economics Betchani Tchereni said: “Policy decisions are not automatic; there are other parameters that come into play, especially for the policy rate.”

On the other hand, Centre for Social Concern programme governance officer Bernard Mphepo said while the price may not be sustained in the short-term, it can affect monetary policy decisions.

Maize is an important crop in the country’s economy and as part of the food component, contributes about 45.2 percent to the Consumer Price Index, an aggregate basket of goods and services which is used for computing inflation.