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Presence Country
Food Security Outlook

Record maize production attained despite fall armyworm infestation

June 2017

IPC 2.0 Acute Food Insecurity Phase

1: Minimal
2: Stressed
3: Crisis
4: Emergency
5: Famine
Would likely be at least one phase worse without current or programmed humanitarian assistance
FEWS NET classification is IPC-compatible. IPC-compatible analysis follows key IPC protocols but does not necessarily reflect the consensus of national food security partners.

IPC 2.0 Acute Food Insecurity Phase

1: Minimal
2: Stressed
3+: Crisis or higher
Would likely be at least one phase worse without
current or programmed humanitarian assistance
FEWS NET classification is IPC-compatible. IPC-compatible analysis follows key IPC protocols but does not necessarily reflect the consensus of national food security partners.
FEWS NET Remote Monitoring countries use a colored outline to represent the highest IPC classification in areas of concern.

IPC 2.0 Acute Food Insecurity Phase

Presence countries:
1: Minimal
2: Stressed
3: Crisis
4: Emergency
5: Famine
Remote monitoring
countries:
1: Minimal
2: Stressed
3+: Crisis or higher
Would likely be at least one phase worse without
current or programmed humanitarian assistance
FEWS NET Remote Monitoring countries use a colored outline to represent the highest IPC classification in areas of concern.

Key Messages

  • Despite the fall armyworm infestation experienced in most parts of the country and the very late distribution of subsidized inputs, Zambia managed to attain a record maize output due to good rainfall.  Maize production is estimated at 3.61 million MT. With a carryover stock level of 567,000 MT, total maize availability will exceed the national cereal requirement by 1.18 million MT, which will be available for export. 

  • Although the maize export ban was lifted in mid-May to encourage exports, the prevailing export tax of 10 percent on maize grain is likely to make Zambian maize uncompetitive in the regional market. There is a delay in the new supplies reaching markets because harvesting started later than usual due to atypical rains that extended into May. Maize prices have remained high much longer than usual due to the delayed harvest, but are likely to fall steeply by July. 

  • Minimal (IPC Phase 1) acute food insecurity is being experienced across the country with the increased green harvest and incoming new main harvest which has increased household food availability. Given the improved food availability at the household and national level, acute food insecurity is projected to be Minimal (IPC Phase 1) for the remainder of the outlook period.

National Overview

Current Situation

Current Food Security

  • Minimal (IPC Phase 1) acute food insecurity is being experienced across the country with the increased green harvest and incoming main harvest which has increased household food availability. Currently households are consuming a variety of seasonal foods such as fresh groundnuts, pumpkins, sweet potatoes, and vegetables which is increasing food diversity. Given the improved food availability at the household and national level, acute food insecurity is projected to be Minimal (IPC Phase 1) for the remainder of the outlook period.
  • The Vulnerability Assessment Committee (VAC) is currently undertaking an assessment targeting only sixteen districts most of which are chronically food insecure areas that normally request food assistance even in average years. Specifically, the assessment focuses on areas viewed as chronically food insecure. Additionally, the information gathered is meant to help design a food security monitoring tool which will be used by the VAC to monitor the situation during the remaining part of the 2017/18 marketing/consumption season.

Agricultural Seasonal Progress and marketing activities

  • Harvesting is still in progress having started later than usual due to atypical rains which extended into the month of May. Those that harvested maize in late May/early June will need to wait before threshing because moisture content remains above the recommended threshold of 12.5 percent. In marginal producing areas, harvesting of maize is mostly complete, while sorghum harvesting is still in progress. Most of the new maize has not yet reached the market, so most of the millers are accessing stocks from the previous season.
  • Despite the fall armyworm (FAW) infestation that spread to all parts of the country and was reported in December and the very late delivery of subsidized inputs, Zambia has managed to produce a record maize crop of 3.61 million MT (Figure 1). This year’s maize production is approximately 27 percent above the recent five-year average. The exceptional output can be attributed to very good rainfall this season and increased production by farmers because of favorable maize prices in the 2016/17 marketing season.  The private sector equally provided a good market to small scale farmers, while the demand for the commodity in the region was exceptionally high.
  • Although about 61 percent of the maize-planted area in Lusaka and 43 percent on the Copperbelt Province was infested with fall armyworm (FAW), based on Ministry of Agriculture statistics (Table 1), both provinces attained above-average maize production this season, implying that the pest had low impact on the yields. Areas that reported less than 10 percent of area affected included Eastern, Muchinga, and Northern Provinces.  Meanwhile, Eastern (49 percent), Muchinga, (39 percent) and Southern (33 percent) Provinces experienced increases that were well-above their respective five-year averages this season. 
  • Generally, production is estimated to have increased for almost all other cereals (rice, millet, sorghum). As expected, cotton registered a production drop of 40 percent below average, while mixed beans atypically recorded a 13 percent drop. Most major cash crops have attained above-average production (Figure 2). Cotton production has been falling since 2013 due to unattractive prices on the world market, while mixed beans have only registered reduced volumes in the last two years. Soybean production increased by 14 and 50 percent, with respect to the previous season and five-year average. This can be attributed to the good prices received in the 2016/17 marketing season which provided farmers with an incentive to expand area under production by 59 percent. 
  • The carryover stock level is at 569,000MT, which is 15 percent lower than the previous season. This brings the estimated total maize availability to a record level of 4.18 million MT and exceeds the estimated national requirement by 1.18 million MT. The surplus will be available for export; however, the Southern Africa market demand will be much lower than the previous season given the anticipated improvements in regional production.
  • Livestock conditions are generally good given the increased availability of pasture and water. In Western Province, restricted livestock movement continues to be enforced since the outbreak of anthrax in February. This may limit livestock marketing activities in Western and might potentially have a negative impact on income for households. 

Trade and market functioning

  • With the delay in the new harvest supplies reaching markets, prices have remained higher than normal at this time. In marginal producing areas, there is no maize in markets, but households are accessing their own production now so demand is low.
  • With maize supplies in transit to markets, and the uncertainty of the maize market this year, traders have yet to fully position themselves. The government has not fully announced its marketing plan through the Food Reserve Agency (FRA) for the new marketing season. However, the FRA has reiterated that it will only buy up to 500,000 MT of maize for strategic reserves once the maize is adequately dry through the end of October. Consequently, activity on the maize market is currently low.
  • In mid-May, after receiving the crop estimates from the Ministry of Agriculture, the government announced the lifting of the maize grain export ban. This announcement came rather late for the traders to benefit fully from the large regional market which existed in the 2016/17 marketing season. Even with the lifting of the ban, a 10 percent export tax on maize grain remains in place. For maize meal, there is no export tax.
  • This time last year, maize prices were already at an average high of ZMW 1.8/Kg and the private sector was actively buying maize. In the case of soybeans, the prices have steeply dropped by as much as 50 percent from their high levels of ZMW 4.6/Kg in the 2016/17 season to between ZMW 2-2.4/Kg. This could be attributed to the substantial increase in production in country and within the region.
  • The consultative commodity marketing meeting for the 2017/18 season was held in mid-June focusing on developing more competitive agricultural commodity marketing systems which are inclusive of small holder farmers. This was also to help address maize marketing challenges this season given the large surplus and limited regional market. During the meeting, there were discussions about exploring ways of enhancing the Zambia Agricultural Commodity Exchange (ZAMACE), and the possibility of the Zambian Government engaging with their counterparts in maize deficit markets in East Africa and about branding the maize as non-GMO. Other proposals included the removal of the export tax on maize grain, which would open the DRC market for exports of Zambian maize surplus this season.  

Assumptions

Between June 2017 and January 2018, the projected food security outcomes are based on the following key assumptions:

Staple food availability: Given the estimated above average 2016/17 maize production (3.61 million MT), and moderate carryover stock (569,000 MT), total maize availability is estimated at 4.18 million MT and will be more than adequate to meet national staple food requirement with an exportable surplus of 1.18 million MT.  In view of this, it is likely that during the June 2017 – January 2018 period, staple food availability for most areas in the country will be at normal to above normal levels.

Labor opportunities: Due to the estimated above average 2016/17 harvest, agricultural labor demand for harvesting, processing, and marketing activities during June, July, and August may be higher than normal, but wages will remain normal. Therefore, poorer households are likely to earn average income as well as in-kind payments for labor. Non-agricultural labor demand is also likely to be average to above-average as better off households that normally hire the poor, will have more crops to sale and more cash to pay for labor. During the October to December period, labor opportunities are expected to be at normal levels for land preparation, planting, and weeding.

Start of Season & Seasonal Progress: Most forecasting models from international climate centers are predicting a higher chance of ENSO neutral conditions from around July 2017, and to persist for the remainder of the year for Southern Africa. There is therefore an increased probability that the start of the 2017/18 rainy season for the country is likely to be on time or normal and rainfall amounts are expected to be normal or average as well. However, these are very early forecasts and changes may occur over the coming months. The 2017/18 seasonal rainfall forecast is expected to be released in August 2017 during the annual Southern Africa Regional Climate Outlook Forum (SARCOF) organized by the SADC Climate Services Centre (CSC) to provide a comprehensive forecast.

Livestock conditions: With the normal to above normal rainfall experienced in the country during the 2016/17 rainy season, FEWS NET expects that livestock conditions will be favorable as pasture and water availability will be at normal levels. In parts of Southern and Western Provinces, livestock will be typically moved to flood plains during the September to November period to enable them access adequate pasture and water.

Agricultural Input support: The government will continue providing subsidized inputs through the Farmer Input Support Program (FISP) to support small scale farmers from September to December 2017. The Ministry of Agriculture intends to provide electronic vouchers for all areas rather than undertake physical input distribution. The program is targeting over 1 million farmers. Timing of voucher access will have a significant impact on timely planting and fertilizer application.

Fall Armyworm: Given the wide spread occurrence of the fall army worm during the 2016/17 season. it is expected that future outbreaks could be more damaging. The impact on crop (maize and other crops) production will depend on the government putting in place a robust monitoring system, integrated pest management (IPM) strategies for control, and a coordinated approach.

Integrated maize grain price trends and projections (Lusaka): Maize prices are expected to remain atypically high in June, but slightly lower than April/May levels. The delayed harvest and delayed drying of the maize will influence the timing of when most of the new harvest will reach the market. Maize prices are expected to steeply fall by July as supplies on the market substantially increase. Given the record production and limited regional market this season, prices are expected to fall below the previous year’s levels by the end of July, and then remain relatively stable up to October/November. Thereafter, the prices typically increase, but this year they will remain below the previous year’s levels. As rural household stocks begin to decrease and more households begin to depend heavily on market purchases (November/December), price will start to increase gradually. Since the main harvest is larger than usual, households may likely delay dependency on the market for a few more months because their own staple production may last slightly longer. This could imply that the lean season may be delayed by a month or may remain mild. As typical, prices will rise from December to January. Throughout the entire outlook period, maize prices are still expected to remain slightly above average given the high levels that have been maintained for the past two marketing seasons.

Maize flow and trade: The lifting of the maize export ban by the government, coupled with an estimated large exportable surplus of 1.18 million MT is likely to increase formal and informal maize exports. However, improved harvest prospects in Malawi, Zimbabwe, and South Africa will result in reduced regional demand. Subsequently, Zambia may have to look to East Africa, which is facing significant maize deficits, for possible markets. Given the 10 percent export duty on maize and relatively high transport costs to East Africa, Zambian maize may become uncompetitive in that market. It is more likely that the DRC and Zimbabwe will remain the main formal maize export markets during the outlook period, provided the export ban to that country is removed. Informal exports to the DRC are expected to continue at normal levels, while exports to Tanzania for Kenyan markets is likely to increase significantly.

Local currency performance and inflation: Given that the exchange rate has remained relatively stable from August 2016 to April 2017, its assumed that this relative stability will likely remain during the outlook period of June 2017 to January 2018. However, despite the drastic drop in the inflation rate since October 2016 and stability during the January to April 2017 period, it is likely that the rate will increase from its current level of 6.5 percent. The recent 50 percent increase in the power tariff and the impending additional 25 percent increase in September are all cost of production increases that support higher inflation rate that is likely to be passed on to consumer through increased prices of commodities.

Social safety-net: It is expected that assistance needs will be much below the five-year average given the estimated above average harvest prospects. Most poor households in the chronically food deficit areas are likely to run out of own produced stocks during the lean period (Nov to Dec), but due to increased labor opportunities, fewer households may look to government for assistance to help fill their food gap through relief efforts. The Zambia Vulnerability Assessment Committee (ZVAC) carried out a Food Security and Livelihoods Assessment in May/June in 16 districts that face chronic food insecurity to determine the magnitude and severity of food insecurity for the 2017/18 consumption season, and recommend the mode of assistance.  Any food assistance needs will be provided by the government using the Food Reserve Agency stocks.

Most Likely Food Security Outcome

Given the expected record maize harvest and good production for many cash crops, Minimal (IPC Phase 1) acute food insecurity will be experienced across the country for the duration of the outlook period. Consequently, most rural households will increasingly depend on their own harvest longer than usual as most areas attained an above average production. Given this situation, employment opportunities are likely to remain at normal levels as better-off households have more food to pay poorer households in exchange for labor.  Additionally, with improved access to food, households holding livestock will not be selling off the animals in desperation at low prices and therefore, will earn normal income.

Given the large harvest, increased household food supply, and limited regional markets, maize prices are expected to fall steeply by July when the new harvest is expected to reach the market in larger volumes.  The prices are expected to fall below the high levels of the 2016/17 marketing season and this will benefit consumers. This will improve access to staples for market-dependent households, especially those in the urban areas. Compared to average, the prices are likely to remain at or above the recent five-year average, given the high levels maintained in the past two years.

Market demand may remain relatively low for longer than usual. Rural households are likely to enter the market much later (two months later average) than usual, which may keep prices stable for a slightly longer period. This also implies that the lean period which typically runs from November to February is likely to be mild. 

Despite the positive outlook, there are chronically food insecure areas that are being assessed. The VAC assessment findings are expected in early July, and will determine if poor households in these areas will need assistance. If required, the government will make provisions through the available FRA stocks. 

Area Event Impact on Food Security Outcomes
National

Abnormally low private sector participation in marketing activities. 

Small-scale farmers will be stick with maize due to a lack of a market. This could result in maize prices falling to below-average levels and earning less from their maize sales this season. This event could ultimately result in farmers reducing their maize area planted for the next season (2017/18) that commences in November. 

 

About Scenario Development

To project food security outcomes, FEWS NET develops a set of assumptions about likely events, their effects, and the probable responses of various actors. FEWS NET analyzes these assumptions in the context of current conditions and local livelihoods to arrive at a most likely scenario for the coming eight months. Learn more here.

About FEWS NET

The Famine Early Warning Systems Network is a leading provider of early warning and analysis on food insecurity. Created by USAID in 1985 to help decision-makers plan for humanitarian crises, FEWS NET provides evidence-based analysis on some 34 countries. Implementing team members include NASA, NOAA, USDA, and USGS, along with Chemonics International Inc. and Kimetrica. Read more about our work.

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