Fertilizer prices have decreased but remain over 2.3 times the average 2020 price while rising government debt distress may put subsidy programmes in question.
Food security in Sub-Saharan Africa remains critical. 13 of the 17 countries tracked in AGRA’s March Food Security Monitor1 showed increases in number of people that are food insecure in January 2023 compared to both January 2022 and 2021 and Fewsnet2 reports large regions of all Sustain Africa focus countries3 in stressed (IPC 2), crisis (IPC3) or – in Kenya – emergency phase.
Fertilizer prices continue to decline, though at modest rates so far in 2023 for DAP, Potassium chloride and TSP, a slight increase for phosphate but just over 30% drop in the price of urea in February vs. December 2022. However, prices overall remain high, at 2.3 times the average 2020 price according to the World Bank4. Retail fertilizer prices remain high and for some products have increased in some countries, for example Malawi and Zambia, with current prices in Ghana elevated over those three months ago5.
The FAO reports generally elevated domestic staple food prices with conflict, adverse weather events and macroeconomic difficulties, particularly currency weakness, continuing to keep domestic prices at elevated levels in many countries6.
Annual food price inflation exceeded 20 percent in over a quarter of all countries in Sub-Saharan Africa in 20227, hitting a new record high in Ghana8 of 61 percent year-on-year in January.
Meanwhile, high levels government debt and declining current accounts in many countries raise concerns of the sustainability of input and other agricultural subsidy programmes. While the average level of gross government debt in SSA in 2022 was 58% there was significant variation, standing at 102% in Mozambique and 90% in Ghana in December 20229
[1] https://agra.org/resource-library/food-security-monitor/
[2] https://fews.net/
[3] Except Tanzania and Liberia which are not covered
[4] World Bank Pink Sheet March 2023
[5] AGRA Food Security Monitor February 2023
[6] Food Price Monitoring and Analysis (FPMA) Bulletin #2, 10 March 2023
[7] World Bank Global Economic Prospects — January 2023
[8] Food Price Monitoring and Analysis (FPMA) Bulletin #2, 10 March 2023
