East-African Region Corn Report

An Expert's View about Cereals, Leguminous Crops, Oil Seeds in Kenya

Posted on: 29 Jun 2012

During the July/June marketing year 2013, Kenya will likely require about 600 thousand tons of white corn imports to meet projected domestic demand.

THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Voluntary Public - Date: 6/21/2012 GAIN Report Number: Kenya Post: Nairobi East-African Region Corn Report Report Categories: Grain and Feed Approved By: Stephen Hammond Prepared By: FAS/Nairobi Staff Report Highlights: During the July/June marketing year 2013, Kenya will likely require about 600 thousand tons of white corn imports to meet projected domestic demand. However, within the East African Community’s (EAC) region, where almost all farmers produce white corn, there will only be about 200-300 thousand tons of exportable corn surpluses that Kenyan importers will be able to access. The remaining imports will likely originate from Member States of a larger trade coalition known as the Common Market for Eastern and Southern Africa (COMESA). Executive Summary: Of the EAC Member States, Kenya will likely import a majority of the corn traded in the region with about 600 thousand metric tons (TMT) of imports during MY 2013, up from an estimated 300 TMT during MY 2012. About 200 thousand tons will originate from Uganda and Tanzania may contribute up to 100 TMT. South Africa, with about two million tons of exportable surplus for MY 2013, would traditionally have supplied most of the remaining 300-400 TMT import shortfall. However, Kenya’s new import requirements for imports of genetically engineered (GE) corn and the 50 percent ad-valorem tariff applied to corn imports from non-EAC/COMESA Member States will likely keep South African corn out of the Kenyan market. Kenya’s new Biosafety regulations, enforced by the National Biosafety Authority (NBA), require import permission for GE commodities, which may imply additional trade uncertainty surrounding potential denial of the permit and/or the potential terms of the import permit. As an example, if the NBA were to issue an import permit, the terms might require the importer to mill the corn at the port of import into Kenya to preclude potential propagation of the GE corn. As a result, Kenyan importers will likely source the remaining import balance from Zambia and Malawi. Both countries are Member States within COMESA and thus not subject to the EAC’s 50 percent ad valorem tariff. The Governments of both countries have in recent years adopted input subsidy and minimum price guarantee programs that appear to have stimulated corn production and, in addition, neither country permits GE corn production or trade, which facilitates exports to Kenya under Kenya’s Biosafety regime. The corn production and trade policies in Zambia and Malawi appear to be facilitating an export platform, which has potential to displace South African white-corn market opportunities in southern and east Africa. As a result, South Africa appears to be on track to play the role of “supplier of last resort” for white corn in the region. The Government of South Africa’s (GSA) decision to adopt GE corn enabled South African farmers to benefit from new agricultural technologies, but may also be working against South African corn exporters. For this report, FAS/Nairobi includes production, supply and distribution tables for EAC Member States, Malawi and Zambia, because of their role in “South-South” trade and because they have enacted specific agriculture production and trade policies that have led them to their current export potential. This report updates the previous FAS dated March 9, 2011. This report reflects the analysis and opinions of the FAS/Nairobi Office of Agricultural Affairs and does not necessarily represent the views or opinions of the U.S. Department of Agriculture in Washington, D.C. EAC The supply and demand table here below presents a favorable price scenario for EAC corn producers on the aggregate through the first half of MY2013 and possibly through the entire year. The MY 2012 and 2013 estimates of aggregate import demand exceed estimates of aggregate exportable supplies by just over 20 TMT for MY2012, but about 300 TMT for MY2013. However, farm-gate price prospects will likely vary substantially within each of the EAC Member States and by regions, because of Member State export bans, non-tariff barriers to intra-EAC trade and high transport and transaction costs associated with transshipments from points of production to points of consumption throughout the region. Tanzanian corn producers, for example, may be financially- disadvantaged by Government of Tanzania (GOT) corn export bans, even while Kenyan corn producers may benefit financially from the GOT action. 2010/ 2011/ 2012/ 5 Yr. FAS/Nair 2008/ 2009/ obi--EAC Corn PSD 2009 2010 2011 2012 2013 Avg. Area Harvested(Mixed MY)(1000 H 5,875 6,118 6,408 6,255 6,290 6,189 ectares) Beginning Stocks(Mixed MY)(1000 M 1,088 961 789 1,465 1,611 1,183 T) Production(Mixed MY)(1000 MT) 7,783 8,194 10,174 9,577 8,927 8,931 MY Imports(Mixed MY)(1000 MT) 1,068 704 74 305 605 551 TY Imports(Oct/Sep)(1000 MT) 1,330 405 205 305 605 570 TY Imports from USA(Oc 220 0 0 0 0 44 t/Sep)(1000 MT) Total Supply(Mixed MY)(1000 MT) 9,939 9,859 11,037 11,347 11,143 10,665 MY Exports(Mixed MY)(1000 MT) 33 105 180 283 305 181 TY Exports(Oct/Sep)(1000 MT) 43 105 176 280 305 182 Feed and Residual(Mixed M 500 500 725 700 600 605 Y)(1000 MT) FSI Consumption(Mixed MY)(1000 M 8,435 8,465 8,671 8,756 8,877 8,641 T) Total Consumption(Mixed M 8,935 8,965 9,396 9,456 9,477 9,246 Y)(1000 MT) Ending Stocks(Mixed MY)(1000 M 961 789 1,465 1,611 1,361 1,237 T) Total Distribution(Mixed 9,939 9,859 11,037 11,347 11,143 10,665 MY)(1000 MT) Yield(Mixed MY)(Tons/HA) 1.50 1.60 1.70 1.60 1.60 1.60 Data Source: Latest available Government area harvested and production data--Otherwise FAS/Nairobi estimates Longer term, EAC Member State producers appear to be increasing production on the aggregate at a faster rate than the increase in EAC population (please see Graph 1) here below). On the aggregate, FAS/Nairobi forecasts that EAC Member States will meet EAC consumptive demand by about 2015 and increase production at or about the level of increasing population, because the production- stimulating effect of the ad-valorem tariff stimulus will soon be completely exhausted as the two aggregated numbers coincide (please see Graph 1) here below). Even though EAC white-corn producers possess tremendous production potential (currently averaging only 1.6 tons/hectare versus South Africa’s four (4) tons/hectare), there aren’t financial incentives for EAC corn farmers to produce, on the aggregate, in excess of EAC domestic demand. If and when EAC corn farmers produce in excess of domestic demand, farm-gate prices will likely plummet, because the non-EAC export market for white corn remains very limited (South Sudan and the DRC) and/or dominated by exports from lower-cost producers like South Africa. EAC Population EAC Corn Production Linear (EAC Corn Production) 160 16 140 14 120 12 100 10 80 8 60 6 40 4 20 2 Graph 1) Increasing EAC Corn Production Growing Faster than Population Population Millions MMTs 0 0 2001 2005 2006 2007 2008 2009 2010 2011 2012 2013 Data Source: Latest available Government area harvested and production data--Otherwise FAS/Nairobi estimates Kenya Currently, almost all of east Africa’s corn exporters will benefit from Kenya’s MY 2013 corn production “shortfall” in that the Kenyan wholesale price draws off exportable supplies from neighboring countries to the extent that the Kenyan market demands additional supply and to the extent permitted by neighboring Governments intent on maintaining food security at home. Kenyan traders have even imported corn from logistically-distant Malawi via Mozambique and the Port of Mombasa. The newly formed Government of Malawi, however, will need to rescind the corn export ban put in place by the previous Government, if they are to contribute to Kenya’s corn supply. The MY 2013 Kenyan corn production estimate reflects a reduced output from the five-year average do to lateness of planting, shortages of seed and fertilizer and a disease some scientists have identified as corn lethal necrosis (CLN) appear to be limiting corn development in some regions. CLN has prompted much concern amongst farmers and in the national press. Local scientists are calling on farmers to burn the infected corn and the Minister has promised replacement seed. In the United States, the disease reportedly prospers when two viruses develop conjointly within the corn stock. One of the viruses implicated could be the corn chlorotic mottle virus, which produces mild symptoms, until a key second virus infects the same corn plant. The second virus can be the sugar cane-mosaic virus or the wheat-streak mosaic virus. CLN reduces yields from slight-to-complete failure, depending on the timing and severity of the infection. 2008/ 2009/ 2010/ 2011/ 2012/ 5 Yr. FAS/Nairobi--Kenya Corn PSD 2009 2010 2011 2012 2013 Avg. Area Harvested (Jul/Jun)(1000 H 1,794 1,885 1,925 1,950 1,975 1,906 ectares) Beginning Stocks(Jul/Jun)(1000 MT) 391 349 193 234 300 293 Production(Jul/Jun)(1000 MT) 2,367 2,439 3,222 3,100 2,600 2,746 MY Imports(Jul/Jun)(1000 MT) 1,013 699 64 300 600 535 TY Imports(Oct/Sep)(1000 MT) 1,305 400 195 300 600 560 TY Imports from USA(Oct/Sep)(1000 M 220 0 0 0 0 44 T) Total Supply(Jul/Jun)(1000 MT) 3,771 3,487 3,479 3,634 3,500 3,574 MY Exports(Jul/Jun)(1000 MT) 3 0 5 8 5 4 TY Exports(Oct/Sep)(1000 MT) 3 0 1 5 5 3 Feed and Residual(Jul/Jun)(1000 MT) 100 100 100 200 100 120 FSI Consumption(Jul/Jun)(1000 MT) 3,319 3,194 3,144 3,129 3,100 3,177 Total Consumption(Jul/Jun)(1000 MT) 3,419 3,294 3,244 3,329 3,200 3,297 Ending Stocks(Jul/Jun)(1000 MT) 349 193 234 300 295 274 Total Distribution(Jul/Jun)(1000 MT) 3,771 3,487 3,479 3,634 3,500 3,574 Yield(Jul/Jun)(Tons/Hectare) 1.30 1.30 1.70 1.60 1.30 1.44 Data Source: Latest available GOK area harvested and production data--Latest available GTA trade data--Otherwise FAS/Nairobi estimates FAS/Nairobi--Kenya Corn PSD 2 0 0 8 / 2009/ 2010/ 2011/ 2012/ 5 Yr. (million 90Kg Bags) 2009 2010 2011 2012 2013 Avg. Area Harvested (Jul/Jun)(1000 H 1,794 1,885 1,925 1,950 1,975 1,906 ectares) Beginning Stocks (Jul/Jun)(million 90Kg 4.34 3.88 2.14 2.60 3.33 3.26 Bags) Production (Jul/Jun)(million 90Kg Bags) 26.30 27.10 35.80 34.44 28.89 30.51 MY Imports (Jul/Jun)(million 90Kg 11.26 7.77 0.71 3.33 6.67 5.95 Bags) TY Imports (Oct/Sep)(million 90Kg 11.26 7.77 0.71 3.33 6.67 5.95 Bags) TY Imports from USA (Oct/Sep)(million 2.44 0.00 0.00 0.00 0.00 0.49 90Kg Bags) Total Supply (Jul/Jun)(million 90Kg 41.90 38.74 38.66 40.38 38.89 39.71 Bags) MY Exports (Jul/Jun)(million 90Kg 0.03 0.00 0.06 0.09 0.06 0.05 Bags) TY Exports (Oct/Sep)(million 90Kg 0.03 0.00 0.01 0.06 0.06 0.03 Bags) Feed and Residual Jul/Jun)(million 1.11 1.11 1.11 2.22 1.11 1.33 90Kg Bags) FSI Consumption (Jul/Jun)(million 90Kg 36.88 35.49 34.93 34.77 34.44 35.30 Bags) Total Consumption (Jul/Jun)(million 36.89 35.50 34.95 34.79 34.46 35.32 90Kg Bags) Ending Stocks (Jul/Jun)(million 90Kg 3.88 2.14 2.60 3.33 3.28 3.05 Bags) Total Distribution (Jul/Jun)(million 41.90 38.74 38.66 40.38 38.89 39.71 90Kg Bags) Yield (Jul/Jun)(90Kg Bags/HA) 14.44 14.44 18.89 17.78 14.44 16.00 Data Source: Latest available GOK area harvested and production data--Latest available GTA trade data--Otherwise FAS/Nairobi estimates The tables above show an increase in yields for MYs 2011 and 2012 that will likely have resulted (at least partially) from a Kenyan Ministry of Agriculture attempt to implement a subsidized fertilizer and seeds program for small-scale farmers. East African corn producers respond very positively to free or highly subsidized inputs as demonstrated in the PSD tables from Malawi and Zambia here below and as shown in the break-even analysis in Table 1) presented below. The Future of Kenya’s Corn-production behind the EAC 50 Percent ad-valorem tariff wall using different production-policy approaches Kenyan corn producers will likely continue to produce at or just below aggregate domestic demand as long as the GOK maintains the 50 percent ad-valorem tariff an in spite of any efforts to push them beyond this level. At the macroeconomic level, as long as Kenyan corn farmers don’t produce in excess of Kenyan aggregate demand, Kenyan farm-gate corn prices can climb to very high levels (please see graph 2) here below), as supported by the 50-percent ad-valorem tariff and high transport and transaction costs. However, once aggregate production exceeds aggregate demand the external tariff no longer provides price support and farm-gate prices can fall precipitously (MY 2006-08 in Graph 2) here below). Corn production in excess of domestic human-consumptive demand must be stored at high cost or sold domestically as animal feed at much lower farm-gate prices, because transactions and transportation costs and quality discounts exclude Kenyan production from the export market. However, more often than not, Kenyan corn farmers produce at levels that assure the highest possible Ksh/Bag Production 3,000 3,500 3,000 2,500 2,500 2,000 2,000 1,500 1,500 1,000 1,000 500 500 Graph 2) The Relatively Strong Inverse Relationship between Aggregate Kenyan Corn Production and Farm-Gate Prices in Kenya TMT Ksh/90KgBag 0 0 farm-gate prices under the EAC corn tariff. The 50 percent ad-valorem tariff wall on non EAC and non COMESA corn imports, combined with the high “basis” (transaction and transportation costs) to bring imported corn to the wholesale markets from outside Kenya, permit strong farm-gate corn prices (please see Table 1) and Graph 2) below). 2001 2005 2006 2007 2008 2009 2010 2011 2012 2013 Prices from the GOK Ministry of Agriculture 3.5 45 40 3.0 35 2.5 30 2.0 25 20 1.5 15 1.0 10 0.5 5 Graph 3) Kenyan Corn Production Trends with the Population Growth Rate—Producing Corn in Excess Million of Kenyan Domestic Demand would likely Lead to GreatlyDiminished Farmer Incomes MMT People 0.0 0 2001 2005 2006 2007 2008 2009 2010 2011 2012 2013 Prices from the GOK Ministry of Agriculture In Table 1) below, the microeconomic estimates clearly indicate that at today’s farm-gate prices and estimated expenses, small-scale farmers benefit financially from, and respond to free fertilizer and seed through the input subsidy programs represented in Scenario a) with increased yields. They also benefit from adhering to the high-investment approach represented in scenario c). However, assisting small- scale farmers (who produce 75 percent of Kenya’s corn production) achieve greater corn yields and production, without commensurate focus on expanding corn off-take will eventually work against the financial position of small-scale corn farmers. In the microeconomic view at the farm-gate, Table 1) below clearly indicates why many external actors dedicate tremendous effort and development funds to improving individual-farmer yields. There’s lots of room for Kenyan farmers to improve yields (please see the yields for South African farmers) and improve incomes, if prices were to remain steady. However, without some form of price stability over and above the protection provided by the EAC 50- percent ad-valorem tariff, Kenyan corn farmers will likely continue to minimize inputs (scenario b). Under this scenario, farmers may not receive enough income to cover minimal extra-farm living expenses required to meet basic family necessities. Table 1) Estimates of approximate break-even points for maize farming in Kenya based on farmer yields of: a) 1.65; b) 1.3; c) 4; and, d) 4 tons/hectare and different input-cost and farm-size scenarios Kenya Shilling (Ksh) and thousand metric tons (TMT) unless otherwise denoted a) b) c) d) Hectare/s/farm family 1 1 1 100 Yield (MT/Ha) 1.65 1.30 4.00 4.00 Yield (90Kg Bags/Ha) 18.3 14.4 44.4 44.4 Farm Production (MT) 1.65 1.30 4.0 400 Farm Production (90 kilo bags) 18.3 14.4 44.4 4,444 Area Harvested (AH)(1000 hectares) 1,906 1,906 1,906 1,906 Production potential under scenarios a), b), c) & d) 3,145 2,478 7,623 7,623 Aggregate National Demand 2009-2013 Avg. 3,177 3,177 3,177 3,177 Shortfall/surplus using AH & Yields in a), b), c) & d) -33 -700 4,446 4,446 Deficit/Surplus AH to meet current demand (1000 Ha) -20 -538 1,112 1,112 Corn Farmers (1000) needed under scenarios a), b), c) & d) 1,926 2,444 794 7.94 Avg. consumption/Kilos/farm family/year--6 Members/Family 480 480 480 480 Avg. consumption/90Kg bags/farm family/year 5.3 5.3 5.3 5.3 Exportable farm surplus (90 kilo bags) 13.0 9.1 39.1 4,439.1 Farm-gate breakeven price under scenarios a), b), c) & d) 2,310 3,690 1,370 433 30,03 33,61 53,58 1,920,00 Gross revenue from exportable surplus 0 9 2 1 20,00 1,600,00 Fertilizer & certified seed expense 0 3,000 0 0 Estimate of Interest Expense 0 600 3,500 280,000 30,00 30,00 30,00 Living Ex. (school fees, food, clothes, etc.) 0 0 0 40,000 30,00 33,60 53,50 1,920,00 Aggregate Expenses (does not include opportunity cost) 0 0 0 0 Net income to producer--includes return to labor 30 19 82 110 Net income to producer (Ksh/90 Kilo Bag) 2 2 2 0 Net income/day/crop 0.08 0.05 0.22 0.30 Net income to producer $0 $0 $1 $1 Net income/day/crop $0.00 $0.00 $0.00 $0.00 Data Source: Average Production GOK--Other estimates based on interviews and public reports a) Free or Nearly-Free Subsidized Inputs --b) Low-Input Investment & Yield --c)--High-Input & Yield Small-Scale Farm--d) High-Input & Yield Large-Scale Farm--The estimates in this table are indicative and intended only to approximate the scenarios represented Reportedly, Kenya’s large-scale farmers have noticed the financial implications in Table 1) above and Graph 2) below and have increased their farm acreage dedicated to corn production. Large-scale farmers, who increase corn area-planted, potentially benefit financially even more from the 50-percent ad-valorem tariff than small-scale farmers, because they capture economies of scale in knowledge, input purchasing power and transaction and transport costs. Large-scale corn farmers (numbering in the tens) reportedly account for about 25 percent of Kenya’s annual corn production. However, they represent a very small fraction of Kenya’s farmers. Some analysts estimate that there are about 3.5 million small- scale Kenyan farmers, however, in Table 1), we can mathematically identify 2.45 million farmers using averaging calculations to make the determination. 21.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 Graph 4) Partly Because of the Price Implications of “Over Producing,” Kenyan White Corn Yields Trend Completely Flat, in spite of Extensive Efforts to Improve Individual Farmer Yields MT/Hectare 1 5 6 7 8 9 0 1 2 3 0 0 0 0 0 0 1 1 1 1 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 Prices from the GOK Ministry of Agriculture Tanzania Tanzanian corn producers will likely produce about 100 TMT of exportable surplus destined for the market in Kenya. These farmers, however, remain even more isolated from the regional market and susceptible to low farm-gate prices than other EAC Member State producers. The Government of Tanzania’s (GOT) policy to keep domestic corn production within Tanzanian borders through tools like the export ban, ultimately helps limit Tanzanian farm-gate price incentives to expand production. Tanzanian corn farmers can’t afford to take the risk of operating in high-investment corn production under the potential threat of rapidly diminishing farm-gate prices that occur when aggregate production exceeds aggregate Tanzanian demand and the GOT chokes off the export market through use of an export ban. 2008/ 2009/ 2010/ 2011/ 2012/ 5 Yr. FAS/Nairobi--Tanzania Corn PSD 2009 2010 2011 2012 2013 Avg. Area Harvested(Jun\May)(1000 H 2,961 3,045 3,288 3,100 3,100 3,099 ectares) Beginning Stocks(Jun\May)(1000 MT) 574 470 196 806 1,036 616 Production(Jun\May)(1000 MT) 3,556 3,326 4,475 4,200 4,000 3,911 MY Imports(Jun\May)(1000 MT) 55 5 10 5 5 16 TY Imports(Oct/Sep)(1000 MT) 25 5 10 5 5 10 TY Imports from USA(Oct/Sep)(1000 M 0 0 0 0 0 0 T) Total Supply(Jun\May)(1000 MT) 4,185 3,801 4,681 5,011 5,041 4,544 MY Exports(Jun\May)(1000 MT) 5 5 75 75 100 52 TY Exports(Oct/Sep)(1000 MT) 15 5 75 75 100 54 Feed and Residual(Jun\May)(1000 MT) 200 100 200 200 200 180 FSI Consumption(Jun\May)(1000 MT) 3,500 3,500 3,600 3,700 3,800 3,620 Total Consumption(Jun\May)(1000 M 3,700 3,600 3,800 3,900 4,000 3,800 T) Ending Stocks(Jun\May)(1000 MT) 470 196 806 1,036 941 690 Total Distribution(Jun\May)(1000 MT) 4,185 3,801 4,681 5,011 5,041 4,544 Yield(Jun\May)(Tons/HA) 1.20 1.10 1.40 1.40 1.30 1.28 Data Source: Latest available GOT area harvested and production data via CountryStat--Otherwise FAS/Nairobi estimates Uganda Ugandan producers appear to be on track to supply about 200 TMT to the Kenyan market and the remaining 300-400 TMT will likely originate in Tanzania, Zambia and Malawi (please see Malawi and Zambia corn PSD tables here below). Ugandan corn producers have relatively unfettered access to the Kenyan marketplace and, as a result, have continued to expand production to meet domestic and Kenyan demand. There remains a formal border between the two EAC Member States that includes the imposition of some non-tariff trade barriers, but border officials don’t apply tariffs and to date, the Government of Uganda doesn’t impose an export ban on domestically-produced Ugandan corn. 2009/ 2010/ 2011/ 2012/ 5 Yr. FAS/Nairobi--Uganda Corn PSD 2008/ 2009 2010 2011 2012 2013 Avg. Area Harvested(Jul/Jun)(1000 H 820 850 850 850 850 844 ectares) Beginning Stocks(Jul/Jun)(1000 MT) 95 30 230 330 180 173 Production(Jul/Jun)(1000 MT) 1,260 1,800 1,800 1,600 1,600 1,612 MY Imports(Jul/Jun)(1000 MT) 0 0 0 0 0 0 TY Imports(Oct/Sep)(1000 MT) 0 0 0 0 0 0 TY Imports from USA(Oct/Sep)(1000 M 0 0 0 0 0 0 T) Total Supply(Jul/Jun)(1000 MT) 1,355 1,830 2,030 1,930 1,780 1,785 MY Exports(Jul/Jun)(1000 MT) 25 100 100 200 200 125 TY Exports(Oct/Sep)(1000 MT) 25 100 100 200 200 125 Feed and Residual(Jul/Jun)(1000 MT) 100 200 200 150 150 160 FSI Consumption(Jul/Jun)(1000 MT) 1,200 1,300 1,400 1,400 1,400 1,340 Total Consumption(Jul/Jun)(1000 MT) 1,300 1,500 1,600 1,550 1,550 1,500 Ending Stocks(Jul/Jun)(1000 MT) 30 230 330 180 30 160 Total Distribution(Jul/Jun)(1000 MT) 1,355 1,830 2,030 1,930 1,780 1,785 Yield(Jul/Jun)(Tons/HA) 1.50 2.10 2.10 1.90 1.90 1.90 Data Source: Latest available GOU area harvested and production data--Otherwise FAS/Nairobi estimates Rwanda Rwandans appear to be/may be developing a taste for white corn, similar to the populations in neighboring Uganda and much of the rest of east Africa. For MY 2013, the estimate of per capita consumption now suggests that Rwandans may derive more than 20 percent of their daily calories from white corn (please see consumption table here below). Many policy makers denounce the high and increasing production and consumption of corn in east Africa and encourage production of drought- tolerant and more nutritious crops such as sorghum or sweet potatoes but farmers/consumers will ultimately decide the balance. 5 2008/ 2009/ 2010/ 2011/ 2012/ FAS/Nairobi--Rwanda Corn PSD Yr. 2009 2010 2011 2012 2013 Avg. Area Harvested(Jul/Jun)(1000 H 185 223 230 240 250 226 ectares) Beginning Stocks(Jul/Jun)(1000 MT) 28 112 170 95 95 100 Production(Jul/Jun)(1000 MT) 484 508 550 550 600 538 MY Imports(Jul/Jun)(1000 MT) 0 0 0 0 0 0 TY Imports(Oct/Sep)(1000 MT) 0 0 0 0 0 0 TY Imports from USA(Oct/Sep)(1000 M 0 0 0 0 0 0 T) Total Supply(Jul/Jun)(1000 MT) 512 620 720 645 695 638 MY Exports(Jul/Jun)(1000 MT) 0 0 0 0 0 0 TY Exports(Oct/Sep)(1000 MT) 0 0 0 0 0 0 Feed and Residual(Jul/Jun)(1000 MT) 100 100 225 150 150 145 FSI Consumption(Jul/Jun)(1000 MT) 300 350 400 400 450 380 Total Consumption(Jul/Jun)(1000 MT) 400 450 625 550 600 525 Ending Stocks(Jul/Jun)(1000 MT) 112 170 95 95 95 113 Total Distribution(Jul/Jun)(1000 MT) 512 620 720 645 695 638 Yield(Jul/Jun)(Tons/HA) 2.60 2.30 2.40 2.30 2.40 2.40 Data Source: Latest available USDA area harvested and production data--Otherwise FAS/Nairobi estimates—very preliminary data Rwanda Corn Consumption based on 3,650 Calories/Kg and a daily diet of 2,200 calories (FAS/Nairobi Estimates) MY Kg/PP/Yr Grams/PP/Day Cal/PP/Day % of Daily Diet Population 2013 40.2 110.1 401.8 18.3% 11,200,000 2012 37.0 101.5 370.4 16.8% 10,800,000 2011 38.5 105.4 384.6 17.5% 10,400,000 2010 34.0 93.1 339.8 15.4% 10,300,000 2009 29.4 80.6 294.1 13.4% 10,200,000 2008 19.6 53.8 196.3 8.9% 10,186,063 2007 10.1 27.7 100.9 4.6% 9,907,509 2006 9.4 25.7 93.7 4.3% 8,648,248 2005 9.6 26.3 96.0 4.4% 8,440,820 2004 6.8 18.5 67.5 3.1% 8,440,820 2003 9.7 26.7 97.3 4.4% 7,810,000 2002 11.1 30.4 110.8 5.0% 7,400,000 2001 8.9 24.4 88.9 4.0% 7,310,000 Burundi 5 FAS/Nairobi--Burundi Cor 8/ 2009/ 2010/ 2011/ 2012/ n PSD 200 Yr. 2009 2010 2011 2012 2013 Avg. Area Harvested(Jul/Jun)(1000 H 115 115 115 115 115 115 ectares) Beginning Stocks(Jul/Jun)(1000 MT) 0 0 0 0 0 0 Production(Jul/Jun)(1000 MT) 116 121 127 127 127 124 MY Imports(Jul/Jun)(1000 MT) 0 0 0 0 0 0 TY Imports(Oct/Sep)(1000 MT) 0 0 0 0 0 0 TY Imports from USA(Oct/Sep)(1000 M 0 0 0 0 0 0 T) Total Supply(Jul/Jun)(1000 MT) 116 121 127 127 127 124 MY Exports(Jul/Jun)(1000 MT) 0 0 0 0 0 0 TY Exports(Oct/Sep)(1000 MT) 0 0 0 0 0 0 Feed and Residual(Jul/Jun)(1000 MT) 0 0 0 0 0 0 FSI Consumption(Jul/Jun)(1000 MT) 116 121 127 127 127 124 Total Consumption(Jul/Jun)(1000 MT) 116 121 127 127 127 124 Ending Stocks(Jul/Jun)(1000 MT) 0 0 0 0 0 0 Total Distribution(Jul/Jun)(1000 MT) 116 121 127 127 127 124 Yield(Jul/Jun)(Tons/HA) 1.00 1.10 1.10 1.10 1.10 1.08 Data Source: Latest available GOB area harvested and production data--Otherwise FAS/Nairobi estimates Malawi Shortly after the disastrous MY 2005 corn crop, Malawian Government officials, with support of many European Governments and NGOs, put in place a subsidized and/or free seeds and fertilizer program for corn production. The subsidization appears to have been effective in spurring sufficient production to meet domestic demand at internal Malawian prices and to have provided some exportable surpluses from time-to-time. FAS/Nairobi generated the PSD table here below using the Government of Malawi (GOM) area harvested and production estimates (there are several differing data series—this one sanctioned by the ministry of agriculture). However, export estimates during the period remain elusive. Using generous export estimates and relatively high stocks, implied domestic consumption appears to exceed Malawian’ potential to consume corn. As a result, FAS/Nairobi limited the estimates of the consumption of corn for food, seed and industrial use to a maximum of about 60 percent of an average Malawian’s 2,200 calorie per day diet (please see table here below) and included the remaining balance in the “Feed and Residual” category. Using this methodology, the “Feed and Residual” category may contain unknown exports, over-reported production, unidentified domestic use, under-reported stocks, as well as corn used for feed. There don’t appear to be any major industrial uses of corn in Malawi. To understand the potential for imprecision in the production estimates, some observers point to a possible incentive under donor-supported seed and fertilizer programs to “over report” the success of donor contributions. Others point to the general poor quality of agricultural statistics in Malawi (and the region in general), including inaccurate estimates of corn exports. Underscoring the difficulty to understand the corn supply situation in Malawi, the GOM imposed a corn export ban at the end of calendar year 2011, even while reporting an above average and fully sufficient MY 2011 crop and average-but-sufficient production estimate for MY2012. FAS/Nairobi has reflected the effect of the ban on the MY 2012 estimate of corn exports but expects that the GOM will lift the ban soon. 2010 2011 2012 5 FAS/Nairobi--Malawi Corn 2008/ 2009/ / / / Yr. PSD 2009 2010 2011 2012 2013 Avg. Area Harvested(May/Apr)(1000 1,73 1,75 1,75 1,71 H 1,650 1,696 ectares) 2 0 0 6 Beginning 1,68 1,45 1,45 1,40 Stocks(May/Apr)(1000 M 1,200 1,240 T) 8 7 2 7 3,41 3,89 3,60 3,42 Production(May/Apr)(1000 MT) 2,635 3,583 9 5 0 6 MY Imports(May/Apr)(1000 M 5 15 0 0 0 4 T) TY Imports(Oct/Sep)(1000 MT) 5 15 0 0 0 4 TY Imports from USA(Oc 0 0 t/Sep)(1000 M 0 0 0 0 T) Total Supply(May/Apr)(1000 5,10 5,35 5,05 4,83 M 3,840 4,838 T) 7 2 2 8 MY Exports(May/Apr)(1000 M 100 100 300 300 200 200 T) TY Exports(Oct/Sep)(1000 MT) 100 100 300 300 200 200 Feed and 1,25 1,40 1,20 1,07 500 1,000 Residual(May/Apr)(1000 MT) 0 0 0 0 FSI 2,10 2,20 2,25 2,12 Consumption(May/Apr)(1000 2,000 2,050 M 0 0 0 0 T) Total 3,35 3,60 3,45 3,19 Consumption(May/Apr)(1000 2,500 3,050 M 0 0 0 0 T) Ending Stocks(May/Apr)(1000 1,45 1,45 1,40 1,44 M 1,240 1,688 T) 7 2 2 8 Total D 5,10 5,35 5,05 4,83istribution(May/Apr)(1000 3,840 4,838 M 7 2 2 8 T) Yield(May/Apr)(Tons/HA) 1.60 2.10 2.00 2.20 2.10 2.00 Data Source: Latest available GOM area harvested and production data--Otherwise FAS/Nairobi estimates Malawi Corn Consumption based on 3,650 Calories/Kg and a daily diet of 2,200 calories (FAS/Nairobi Estimates) MY Kg/PP/Y Grams/PP/Da Cal/PP/Da % of Population r y y Daily Diet 201 61.0 3 134.1 367.4 1,341.1 % 16,776,825 201 61.3 2 134.8 369.3 1,347.8 % 16,323,044 201 60.2 1 132.3 362.6 1,323.3 % 15,869,263 201 132.9 364.0 1,328.7 60.4 15,428,098 0 % 200 60.6 9 133.3 365.3 1,333.4 % 14,999,197 200 59.2 8 130.3 357.0 1,303.0 % 14,582,219 200 57.7 7 127.0 347.9 1,269.7 % 14,176,833 200 47.8 6 105.2 288.2 1,052.0 % 13,782,717 200 54.3 5 119.4 327.1 1,194.1 % 13,399,558 200 55.8 4 122.8 336.5 1,228.2 % 13,027,050 200 57.4 3 126.3 346.1 1,263.3 % 12,664,898 200 59.1 2 129.9 356.0 1,299.5 % 12,312,814 200 60.8 1 133.7 366.2 1,336.6 % 11,970,518 Zambia The above discussion regarding estimates for the Malawi PSD applies also to the data presented here below for Zambian corn PSD--completely reliable data remains difficult. Regardless of data accuracy, very clearly Zambia has become a corn exporter in the region, replacing South Africa as the exporter of preference for exports to Zimbabwe and Kenya. The Government of Zambia (GOZ) established a policy of setting a domestic floor-price for corn (a form of contract) and buys more than half of Zambian-farmer production at the floor price. That policy has spurred domestic production, skyrocketing from just over 560 TMT during MY 2000 to about three million metric tons in recent years (please see the PSD table here below for the most recent years). The GOZ corn floor-price converts to be about $245/ton, while in Kenya, the market price currently rests at about $280/ton, providing economic support for Kenyan imports from Zambia. In addition, the GOZ does not permit the production or trade in GE corn. As such, Zambian corn exports to Kenya do not come under scrutiny of Kenya’s NBA. Zambia will reportedly export about 300 TMT to neighboring Zimbabwe, as a result of a G-to-G deal recently inked. When combined with the 100 TMT “on the water” to Kenya, Zambia will have cleared 400 of the 500 estimated in the MY 2012 exportable surplus. FAS/Nairobi--Zambia Corn PSD 2008/ 2009/ 2010/ 2011/ 2012/ 5 Yr. 2009 2010 2011 2012 2013 Avg. Area Harvested(May/Apr)(1000 H 1,125 1,242 1,356 1,300 1,300 1,265 ectares) Beginning Stocks(May/Apr)(1000 MT) 145 117 309 909 1,154 527 Production(May/Apr)(1000 MT) 1,212 1,887 2,795 3,020 2,850 2,353 MY Imports(May/Apr)(1000 MT) 60 5 5 0 0 14 TY Imports(Oct/Sep)(1000 MT) 60 5 5 0 0 14 TY Imports from USA(Oct/Sep)(1000 M 0 0 0 0 0 0 T) Total Supply(May/Apr)(1000 MT) 1,417 2,009 3,109 3,929 4,004 2,894 MY Exports(May/Apr)(1000 MT) 0 100 100 300 600 220 TY Exports(Oct/Sep)(1000 MT) 0 100 100 300 600 220 Feed and Residual(May/Apr)(1000 MT) 100 200 600 675 750 465 FSI Consumption(May/Apr)(1000 MT) 1,200 1,400 1,500 1,800 1,850 1,550 Total Consumption(May/Apr)(1000 M 1,300 1,600 2,100 2,475 2,600 2,015 T) Ending Stocks(May/Apr)(1000 MT) 117 309 909 1,154 804 659 Total Distribution(May/Apr)(1000 MT) 1,417 2,009 3,109 3,929 4,004 2,894 Yield(May/Apr)(Tons/HA) 1.10 1.50 2.10 2.30 2.20 1.84 Data Source: Latest available GOZ area harvested and production data--Otherwise FAS/Nairobi estimates Zambia Corn Consumption based on 3,650 Calories/Kg and a daily diet of 2,200 calories (FAS/Nairobi Estimates) MY Kg/PP/Yr Grams/PP/Day Cal/PP/Day % of Daily Diet Population 2013 128.2 351.4 1,282.5 58.3% 14,425,000 2012 128.6 352.3 1,285.7 58.4% 14,000,000 2011 110.5 302.7 1,105.0 50.2% 13,575,000 2010 106.4 291.4 1,063.6 48.3% 13,163,000 2009 94.0 257.6 940.1 42.7% 12,764,000 2008 93.1 255.0 930.8 42.3% 12,377,000 2007 100.3 274.7 1,002.5 45.6% 12,000,000 2006 87.8 240.6 878.2 39.9% 11,637,000 2005 88.8 243.3 888.0 40.4% 11,284,000 2004 89.4 244.9 893.8 40.6% 10,942,000 2003 67.8 185.7 677.7 30.8% 10,610,000 2002 86.5 237.0 865.1 39.3% 10,288,000 2001 90.2 247.2 902.2 41.0% 9,976,000
Posted: 29 June 2012

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