17 January 2013

Ethiopia: Positive Price Decline in Cereal Market

In spite of an irregular rainy season, the mehar harvest (October to December) is expected to be above-average, leading to a stabilisation or slight decline of prices in the cereal market. The harvest is expected to have a positive impact on the market supply and staple food prices during the first quarter of 2013, with further declines in price later in the year, according to a report issued by the UN Office for Coordination of Humanitarian Affairs.

Nonetheless, reduced yields are expected in belg rain (March-May) dependent areas in eastern Amhara, southern and southeastern Tigray, East and West Harerge and parts of Arsi, Bale, Borena, North and West Shewa zones, as well as the agricultural and agro-pastoralist areas in Somali Region.

The expected impact on the seed harvest has been confirmed by a report released by the Central Statistics Agency, announcing that Ethiopia's year-on-year inflation has fallen to 12.9pc from 15.6pc, while food price inflation declined by 1.6pc to 11.8pc. This has been a consistent trend since August 2012. The Agency attributed the drop in food prices primarily to the mehar harvest reaching the market, as well as the influence of international prices.

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