Sahel price strains
Several Sahel and West African countries have seen prices of agricultural commodities rising since September 2007 compared with 2006 and on into the first quarter of 2008. This has given rise to tension in some countries like Burkina Faso, Cameroon, Côte d’Ivoire and Senegal.
Also, figures show that the region has seen a slight decline in cereal output compared with 2006-07, even if there was a 16% increase on the five-year average. The decline is due to the cumulative effect of flooding and an early end to the winter rains (in September). In particular, the production shortfall recorded in northern Nigeria could have major implications for the other Sahel countries, particularly Niger, as the shortfall comes at a time of high demand for cereals from the agro-food industries for the likes of brewing and livestock feed.
The strain on markets is palpable, and is compounded by the increase in world foodstuff prices. Some countries have taken steps to counter the rise by repealing taxes and import duties on some foodstuffs or releasing institutional stocks at subsidised prices, but these measures have so far had little effect. Now there is also uncertainty as to whether existing stocks can meet demand during the lean season, which is boosting speculative trading by private operators. The strain on the markets could well be long-lasting. Rory J. Clarke
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©OECD Observer No 267 May-June 2008
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