WFP denies food aid causing slump in maize prices

The United Nations' World Food Programme (WFP) on Thursday denied that the sale of food aid it had distributed to refugees in Kenya was contributing in any significant way to an oversupply of maize on the local market, which has resulted in a slump in prices and hit farm incomes. It was "really without much foundation" that the Kenyan market could be distorted, or flooded, by the volumes of food WFP was distributing to refugees (in Kakuma and Dadaab refugee camps in the northwest and east of the country respectively), WFP official Paulette Jones told IRIN. Kenyan farmers have blamed food aid brought in by aid agencies for a steep drop in local prices, which has hit farm incomes, already depressed by market liberalisation, the BBC reported on Tuesday, 19 March. Many of the refugees in Kenya were reared on a diet based on wheat flour or rice and allegedly sold the maize rations they received from WFP to help buy the type of food they wanted, the report stated. There were approximately 215,000 refugees in Kenya (as of the start of this year), with some 132,00 in Dadaab (about 129,000 of those Somalis) and a little over 83,000 in Kakuma, where Sudanese (67,000-plus) are in the majority, according to the office of the UN High Commission for Refugees (UNHCR). The WFP told IRIN on Thursday that, while some refugees may trade or barter some commodities for others, this would not be of a scale to affect national maize prices. Refugee rations have had to be temporarily reduced to 60 percent of their normal level because of funding problems, so it seemed unlikely there was much excess food to trade in the marketplace, an official added. In any case, the amount of maize WFP was distributing was "very limited" in comparison with the overall size of the Kenyan market, the agency said. WFP has also pointed out that 88,729 mt of food distributed in Kenya in 2001 was bought in the country through local purchase orders by the government and WFP - which should support local prices - and that the agency does everything it can to make sure it does not have a negative effect on food crop prices through its operations. "Local farmers may be finding it hard to offload maize crops [in an oversupplied market] but to say the glut, or farmers not having the livelihood they would like, is because of food aid is not the case," Jones told IRIN. The market price of a 90 kg bag of dry maize ranged between 850 Kenya Shillings (Ksh) in the coastal city of Mombasa to KSh 750 in the Kenyan capital, Nairobi, and KSh 700 in Nakuru, in the Rift Valley, the Daily Nation newspaper reported on Friday. Green maize [on the cob] was selling for between KSh 2,500 in Mombasa, KSh 1,900 in Nairobi, KSh 1,700 in Nakuru and as low as KSh 1,200 in Kisuma, western Kenya, it added. As well as being critical of food aid, farmers have accused the Kenyan government of failing to protect them from cheap imported foodstuffs, and of being too keen to embrace free-market policies, according to the BBC. The government maintained that it could not protect local farmers from a competitive global market, and that farmers should not expect subsidies, it added. Part of the issue is that relatively good "long rains" in 2001 (especially in the main producing areas of the Rift Valley Province) provided for a good maize crop. This, combined with carry-over stocks, has led to a sharp decline in prices in recent months, such that the government has appealed to donors to increase local purchases of food aid. One danger is that, with maize prices so depressed, some farmers may not bother planting the crop this year, which could in turn lead to shortages next year, according to humanitarian sources. Maize production came in at about 2.31 million mt for 2001, an increase of about 20 percent over the previous year, the United Nations' Food and Agriculture Organisation (FAO) reported in February 2002. Assuming an average short rains crop, the aggregate 2001/02 maize production is projected at 2.7 million mt, which would be "well above average", it stated. For Kenya - a low-income, food-deficit country - that would mean an estimated food import requirement of 1,200 mt for 2001/'02. Given anticipated commercial imports of 751 mt, that would leave a food aid requirement of almost 450 mt, according to the FAO. [see http://www.fao.org] Despite an overall improvement in food supply, especially given a much-improved maize crop, serious food supply difficulties persist in pastoral areas, particularly in Turkana District, northwestern Kenya, Mandera in northeastern Kenya, and parts of Marsabit District in northern Kenya, the FAO stated. At the height of the Horn of Africa drought in 2000, some 3.2 million Kenyans in 22 districts were dependent on food aid, with malnutrition rates soaring to rates as high as 40 percent, more than three times the normal level. In November/December 2001, WFP distributed about 27,000 mt of food to about 1.5 million people in 13 pastoral and agro-pastoral districts that continue to be affected by drought. The nutritional status of most pastoralists (especially children) has stabilised from the dangerous lows of mid-2000, but several pastoral districts still need assistance to improve access to adequate clean and safe water, and health and sanitation services, as well as to food, according to humanitarian sources. The European Commission's humanitarian aid office (ECHO) on Tuesday announced that it is to provide 2.5 million euros (about US $2.2 million) to help some 70,000 pastoralists affected by continuing drought in north and northeast Kenya. The funding, to be channeled through partner NGOs and UN agencies, is intended to support a range of health and nutrition, livestock support, and water and sanitation activities.