Informal Cross Border Food Trade in Southern Africa
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- Lawrence Isaac Cunningham
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1 ay Informal Cross Border Food Trade in Southern Africa Issue tember 2 Inside this issue: Summary and Overview Summary of Maize trade flows Summary of rice trade flows Summary of bean trade flows Annex : Historical summary tables and Map A Technical Steering Committee (TSC) of the Cross Border Food Trade Monitoring Initiative, with funding from USAID, has prepared this report based on data collected by a network of border monitors based at selected border points. The border monitors record data on a daily basis, and transmit it to a central location for collation and analysis. Currently, the informal cross border trade monitoring system includes 29 borders, with new borders are added as necessary. The Alliance for Commodity Trade in Eastern and Southern Africa (ACTESA) has since ch 2, been collaborating with WFP and FEWS NET on this initiative. Please address comments/ suggestions to the following addresses: pmdladla@fews.net; itarakidzwa@fews.net.; or joao.manja@wfp.org; 2 6 Summary Recorded informal trade in maize, rice and beans in tember amounted to 8,2 MT, 8 MT, and,2 MT respectively. Informal maize and rice trade dropped by 2 and percent respectively while bean trade rose by 2 percent between August and tember. Direction of informal maize trade flows remain unchanged; the main exporters remain Malawi,, and Zambia, while DRC, and Zimbabwe remain the main destination countries. This, Tanzania and have emerged as main transit routes for informal trade from Malawi going into Kenya and Zimbabwe. Rising demand has led to sustained increases in nominal maize grain prices in trade centers near the Milanje and Machipanda border posts in central and in Kasumbalesa border on both Zambian and DRC sides. The traded volumes of Figure : Maize, Rice and Bean Trade Volumes: April tember 2 compared to April tember 2 Maize Rice Beans 2 2 maize, rice and beans in tember amounted to 9,96 MT, which is 8 percent above the total of,2 MT recorded in the same month last year. Trade in maize grain alone is up percent over amounts traded in April May e July August t the same period. Higher volumes of recorded trade are indicative of increased availability of exportable surpluses among monitored countries as well as rising demand from deficit areas such as the Greater Horn of Africa. Maize accounted for about 92 percent of the trade captured in tember with the major flows being from Malawi into and Tanzania in transit to Zimbabwe and Kenya. Metric tonnes The August to tember trends in maize, rice and beans informal trade show a marked decline of 2 percent in traded maize volumes; a percent drop in rice trade and a 2 percent increase in bean trade (Table I). This unexpected drop in maize and rice trade can be attributed to reduced trade activity across the Zambian borders due to security concerns and uncertainty before and after the general election held on tember 2th resulting in an unusual drop in informal maize trade volumes during the month of tember Table : Summary of 2/2 informal Trade Flows MT) April 2 May 2 e 2 8,22 6,2 July 2 August 2 tember 2 Maize (Incl. maize meal) 6,8 2,8 2, 8,2 9,296 Maize meal (only) ,89 Rice 282 8, 9 6 8, Beans ,26,2,8
2 ay Page 2 Summary of Maize trade flows Informal Cross Border Food Trade in Southern Africa metric tonnes, 2, 2,,,, Fig 2: Recorded Volumes of Informal Cross Border MAIZE Trade: 2/ to 2/2 Apr May Jul Aug Oct Nov Jan Feb 2/2 2/ 2/6 26/ 2/8 28/9 29/ 2/ Figure 2 shows trends in volumes of informal maize trade (includes maize meal converted to grain equivalents) among the monitored countries while Figure (a and b) shows the trade flows by source and destination. The monthly volumes of informally traded maize peaked at 2, MT in August and dropped 2 percent in tember to 8,2 MT. This drop is in line with al patterns even though this tember s traded maize volume is the highest ever recorded since the inception of informal cross border monitoring in 2. Trade flows (ranked by volume and direction) were recorded along the Malawi/, Malawi/Tanzania, / Malawi, South Africa/ Zimbabwe, Zambia/DRC, Tanzania/ Zambia and /Zambia borders. The lifting of the maize export ban in Malawi; existence of export markets in food deficit countries in East Africa and Zimbabwe, and the existence of large surpluses following several years of above average harvests in the monitored countries remain the major factors influencing large volumes of informal maize trade within the region. metric tonnes 2 2 Figure a: Monthly maize exports by source: April tember 2 compared to April tember 2 Zimbabwe Zambia Tanzania South Africa Malawi Exports: Malawi continues to dominate the export market with a 62 percent total share of exports followed by at 2 percent. shares of exports for Zambia, South Africa and Tan April May e July August t metric tonnes 2 2 Figure b: Monthly maize imports by destination: April tember2 compared to April tember April May e July August t Zimbabwe Zambia Tanzania DRC Malawi zania remained relatively low at 6. percent,.9 percent and.2 percent respectively. Although the monitoring system captures all Malawi exports crossing the and Tanzania borders as imports into those countries, the traders concerned reveal that the final destinations are Zimbabwe and Kenya. Imports: The 2/2 marketing year monthly data continues to show with the largest share of total imports (about 6 percent) followed by Malawi and Tanzania at 2 and percent respectively. The DRC, Zambia and Zimbabwe had the least shares at 6.8 percent,.8 percent, and.9 percent respectively.
3 Issue Page ay Table 2: Informal cross border MAIZE trade by source and destination country (MT) /6 6/ /8 8/9 9/ / t 2 t 2 April t 2 April t 2 Malawi 9, 2 6,2 2,29 96,6 Malawi DRC Malawi Tanzania 9 2,928,8 29 6,, 6,92 Malawi Zambia 8 22, Malawi Zimbabwe 6. Malawi,28,9 6,8,22 6,99 2,, Zambia 9,269 2, 86,62 8, 9 Zimbabwe 2,8 8,6 South Africa Zimbabwe, ,66, 9, 86 Tanzania Malawi 8,862,888, 2, Tanzania Zambia,6 6,26,98 2,9,, Zambia DRC,682 9,8,2,89 9,86 2,,2 9 Zambia Malawi 9 8 2,,88 6 Zambia Zambia Tanzania 2 2 Zambia Zimbabwe ,9 Zimbabwe Zimbabwe Zambia Traded (MT),99,2 8,69, 2,68 96,8 8,699 8,2 2,6 6, 226 2,22,66 2,6,29, , 2,,2 88 9,696 2,8,8 2,2, ,296 Note: Volumes of maize meal trade are estimated in grain equivalent and added to the volumes of informally traded maize as presented in Table 2 above Table : Informal MAIZE MEAL trade flows by source and destination country (MT) 9/ / April 2 May 2 Malawi Zimbabwe 2 Malawi 8 2 South Africa Zimbabwe 9,2 2 Tanzania Zambia 9 Zambia DRC,89,6 6 Zambia 6 Zambia Tanzania 2 2 Zambia Zimbabwe 9,2 Zimbabwe Zambia Traded (MT) 2,2 8,92 9 e July August t April to tember 2 2,2 8,89 Maize meal exports from Malawi into were once more down to usual levels (2 MT in tember) after a huge spike recorded in August. Reasons for the large export in August remain unclear, but it may well have been formal stocks mistakenly captured as informal by border monitors. Informal maize meal trade remains dominant between South Africa and Zimbabwe with the latter being the recipient (Table ). Nominal maize grain prices at source and destination points: Figures a to c (page ) present monthly nominal maize grain prices (in USD equivalent) for selected border points, while Table shows the monthly percentage changes for the current marketing year as well as the year on year changes for the period ending tember 2. The monthly price percentage changes between August and tember show significant price increases along the side of the Milanje border (with Malawi), as well as on both sides (Zambia and DRC) of Kasumbalesa border. These price increases are in line with al price trends as marketable supplies begin to dwindle as household stocks deplete and many households turn to the markets for food. In addition, increased demand by traders on the markets in these particular areas as they exploit export opportunities is also exerting additional upward pressure. Year on year price changes continue to show varied trends: some markets show higher price levels, while others are down from last year. Modest increases ranging from percent in Kasumbalesa (Zambia) to percent in Milanje (). Elsewhere prices still remain below last year s levels confirming availability of the commodity.
4 Page Informal Cross Border Food Trade in Southern Africa Table : Percent change in nominal maize grain prices at source/ destination points (USD cents/kg) Price at (S) and (D) % change to Apr 2 % change Apr to May 2 % change May to e 2 % change e to July 2 % change July to August 2 Maize Price Aug 2 (cents/ Kg) Maize Price t 2 ( cents/ kg) % change Aug to t 2 Maize Price t 2 (cents/ kg) Maize Price t 2 (cents/kg) % change t 2 to t 2 Mal/Moz: Muloza (D) Moz/Mal: Milanje (S) Moz/Zim:- Machipanda (S) Zam/DRC: Kasumbalesa (S) DRC/Zam: Kasumbalesa (D) Tan/Zam: Nakonde (S) Figures a-c: Retail MAIZE prices in selected border points (USD cents/ kg) 8 6 Malawi - Muloza (9) Milange (9) 2 - Machipanda (2) US$ cents/kg 2 2/6 26/ 2/8 28/9 29/ 2/ 2/2 Zambia - Kasumbalesa (2) DRC - Kasumbalesa (2) (US$ cents/kg) 2 2/6 26/ 2/8 28/9 29/ 2/ 2/2 Malawi - Songwe () Zambia - Nakonde () Tanzania - Kasumuru () (US$ cents/kg) 2 2 2/6 26/ 2/8 28/9 29/ 2/ 2/2
5 Issue ay Page Summary of Rice trade flows Table. Informal cross border RICE trade by source and destination country (MT) /6 6/ /8 8/9 9/ / t 2 t 2 April t 2 April t 2 Malawi Malawi Tanzania,2,68 29,99 Malawi Zambia 2,6 99 2,6 2 Malawi Zimbabwe 6 Moz Malawi,69, Moz Zambia Moz Zimbabwe 99 8,28, RSA Zimbabwe ,2 6 Tanzania Malawi 92 2 Tanzania Zambia Zambia DRC 2,629,69 6,6 9,,66,89 8 Zambia Malawi Zambia Tanzania 6 9 Zambia Zimbabwe 6 8,2, Zimbabwe Zambia 8 Traded (MT) 6,62,,,268, 6, ,2 289, , Table and Figure summarize informal cross border rice trade trends. Monthly volumes of traded rice continue to dwindle following the peak in e. Recorded trade has dropped 6 percent from the peak of, MT to just 8 MT in tember. The low level of informal trade in rice is expected as maize grain (for which rice serves as a substitute) remains readily available for most households. This year s informally traded rice volumes for the month of tember and the cumulative (April to tember) volume compares quite well with the volumes captured last year which was an equally good year in terms of maize availability. In tember, rice flows (ranked in order of volumes) were captured along the Tanzania/ Zambia, Zambia/DRC borders, Malawi/ Tanzania, and Malawi/. Trends in Volumes of Rice Traded by Month and Year, Figure : Recorded Volumes of Informal Cross Border RICE Trade: 2 / to 2/2,, 2, e s n to e tric m 2,,, Apr May Jul A ug Oct N ov Jan Feb M ar Rice 2/2 2/ 2/6 26/ 2/8 28/9 29/ 2/
6 Page 6 Informal Cross Border Food Trade in Southern Africa ay Summary of Bean trade flows Table 6. Informal cross border BEAN trade by source and destination country (MT) /6 6/ /8 8/9 9/ / t 2 t 2 April t 2 April t 2 Malawi Malawi South Africa 2 Malawi Tanzania Malawi Zambia Malawi Zimbabwe 8 Malawi 2, 2,98 2,, 2,69 6,9 9 2 Zambia 2 Zimbabwe South Africa Zimbabwe Tanzania Malawi 2,9,66,68 2,9 622,6 28 Tanzania Zambia 2 88,8 96,99, 22 Zambia DRC 8,2 2,22 2,8,88,8, Zambia Zambia Tanzania Zambia Zimbabwe Traded (MT),,,988 9,26 8,8,8,99,2 8, ,22 6 9,,96 96,68,6 8 68,8 Bean trade has generally been consistently moderate this year with the tember 2 volume of,2 MT being the highest on record since the beginning of the current marketing year (Figure 6). This is indicative of availability of tradable stocks as a result of last year s good harvests. In southern Africa, most rural households consume beans as the main source of protein. The cumulative April to tember volume of informally traded beans has declined significantly (by percent) over last year s, MT to,8 MT this year (Table 6). This could be indicative of increased bean availability (from own harvests) at household level. Bean trade flows remain significant along the / Malawi, Tanzania/ Malawi, Tanzania/Zambia and Zambia/DRC borders. Malawi remains the major bean importer this marketing year with the highest share of total imports at percent. The DRC and Zambia registered shares of 2 and 26 percent respectively. Elsewhere bean trade remains low and insignificant. Trends in Volumes of Bean Traded by Month and Year e s n to e tric m,, 2, 2,,, Figure 6: Recorded Volumes of Informal Cross Border BEAN Trade: 2/ to 2/2 Apr May Jul A ug Oct Nov Jan Feb Beans 2/2 2/ 2/6 26/ 2/8 28/9 29/ 2/
7 Issue Page Annex ay : Trade Tables Table Informal Cross Border trade in Maize (MT) 2/ 29/ / /8 26/ 2/6 2, Tanzania Zambia,6 6,26,98, ,9 9,89,8,,88,89,2,89,26,8 Zambia Zimbabwe Zambia Malawi 9 8 2, 2, 9, Zambia Tanzania Malawi Zambia 8 22,9 9,6, ,6 2, Zambia DRC,682 9,8,2,,89,,88 2,69,9 2,89 2,8,26,288,9,6 Zimbabwe 2, ,,8,26 9 8, Zambia 9,269 2, ,22,92,9 9,22, , ,,9,2, 6,,8 9, 2, Zimbabwe,688 9, , 9, 2,66 2,9 9 8,22 2,2 2,9 2, ,6 2,9 2,6 9,9,,88,2 Malawi,28,9 6,8,9,22 9, 8, 9, 9, 9 2, Malawi Tanzania 9 2,928, , 82 2,6,8 2,6, 28,, Tanzania Malawi 8,862,888,888 2, Malawi Zambia Zimbabwe 6 South Africa 9, 2,8 2, 6 26,6 2, 6,862 2,9,2 26,6 2,,26 6,28 8 9,,9 28,6 6 Traded (MT),99,2 8,69 Table 8: Informal Cross Border trade in Rice (MT) 2/ 29/ South Africa / /8 26/ Tanzania Zambia Malawi Tanzania,2, Tanzania Malawi Zambia DRC 2,629,69 6,6,66,2 2,,6 9, Zambia Malawi Malawi Zambia 2, Zambia Zimbabwe 6 8, , Malawi,69, Malawi Zimbabwe 99 8, ,98 2/ Zimbabwe Traded (MT) 6,62,,,6 2,88,92,68,
8 Page 8 ay Informal Cross Border Food Trade in Southern Africa Annex (continued) Table 9: Informal cross border trade in beans (MT) 2/6 26/ 2/ / / 2/ Tanz Zambia 2 88, , , Zambia Tanz Zambia DRC 8,2 2,22 2, ,88 6,,9 688,8,296, ,88 Malawi Moz Zambia Zim Moz Malawi 2, 2,98 2,, , ,69 2,2 2,68,2 6,9 Malawi Tanz Moz Zim Malawi Zambia Tan Malawi 2,9,66,68, , ,6 RSA Zim Traded (MT),,,988, 2,2, 8,288,6 2,2 2,8,6 8,8,,6 2,926 2,2,92 ACTESA -COMESA, Lusaka, Zambia; UN World Food Programme Regional Bureau for Southern Africa, Johannesburg South Africa and FEWS NET Regional Office, Pretoria South Africa For more information see:
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