Weather shocks to affect food inflation—FewsNet

Famine Early Warning Systems (FewsNet) says the below average rainfall over southern African countries, including Malawi could threaten the 2022 harvest and higher food inflation.

In a statement on the weather summary and outlook published last week, FewsNet notes that the below average rain through November to mid-December in some southern African countries remain a threat to harvest and inflation.

Reads in part the statement: “Across these areas, drought conditions are ongoing to start the season as land preparation activities are delayed, and planting has yet to begin across many areas as of November.”

“If rains do not come before the planting window closes, next year’s harvests will be smaller with a knock-on effect on food prices.”

According to the FewsNet, although regional maize levels remain above average, monthly prices seem to be rising and above average, a situation which is already heightening Inflation.

In Malawi, maize, as part of the food component, accounts for about 45.2 percent of the Consumer Price Index, which is an aggregate basket of goods and services for computing inflation.

In an interview on Tuesday, agriculture policy development expert Tamani Nkhono-Mvula observed that it would be too early to determine the impact of the current situation on inflation and harvest.

He, however, said given that the country is an agro- based economy, any weather-related shocks impact on economic growth and inflation which is largely driven by food.

Meanwhile, Malawi’s annual rate of inflation has been rising lately owing to rising food and non-food inflation in the country.

According to National Statistical Office figures, Malawi’s year-on-year headline inflation rate for November 2021 rose by 1.3 percentage points to hit 11.1 percent, triggered by a rise in food and non-food inflation.

The figures show that during the same period last year, inflation rate was recorded at 7.3 percent. This means prices of goods and services during the period under review increased at a fast rate.

Reserve Bank of Malawi pegged the 2021’s average inflation rate at 9.1 percent, which means at 11.1 percent recorded in November, the country’s inflation is higher than the RBM target.