Global Highlights
• The global cereal price index increased by 8.8% on a year-on-year basis in the January-March 2013 quarter.This increase is driven by increases in real prices of maize and wheat (+8% and +13%, respectively).
• However, on a quarterly basis (Q1-2013 vs. Q4-2012), global maize, wheat and rice prices fell by respectively 7%, 13%, and 5%, respectively. For wheat, the decline is mostly attributable to favourable harvest prospects due to improved weather in major growing regions. In Q1-2013, wheat prices are 28% lower than during their peak period in 2008. Maize prices are still 9% higher than during Q2-2008 and 8% above the same period in 2012. The price of rice is stable compared to the same period in 2012.
• Dynamics and price trends for domestic markets are quite different than global trends. The impact of domestic price changes on the food basket cost in the last quarter was high (5-10%) or severe (above 10%) in one third of the 65 countries monitored. The most severe effects are driven by prices of maize in Malawi (32%), wheat in Tajikistan (23%) and wheat flour in Bolivia (22%).
• Overall the purchasing power of Malawians has deteriorated sharply as a result of the devaluation of the local currency (Kwacha) in May 2012. The average monthly inflation rate has soared to 38% in February 2013. The price of maize is more than four times its price two years ago in some markets.
• Despite a good 2012/2013 crop year, local prices in Niger have not recovered from the 2011/2012 production deficit in the Sahel. Millet prices at most markets are unusually high and are expected to increase in the coming months with the start of the lean season.