 | |  | |  | |  | |  |
| All Rights Reserved © Copyright AfriCommex 2008 |
| Africa Commodity Exchange |
the african farmer's marketplace
 | |  | |  |
| North Africa In North Africa, harvesting of the winter grains (mainly wheat and barley), which make up the bulk of the subregion’s cereal crop, is underway and FAO’s latest forecasts put the subregion’s aggregate output of wheat (the main crop) at nearly 16 million tonnes, 18 percent up from the previous year’s drought-reduced level, while that of barley is put at some 3 million tonnes, about 7 percent up from 2007. The outlook is favourable in Egypt, the largest producer of the subregion, where wheat output is expected to be about 12 percent up from last year and 9 percent above the recent average. In Algeria, the wheat crop is also forecast above average by about 7 percent. In Morocco, latest forecasts point out to a substantial recovery in cereal production from last year’s drought-reduced crop, although output would remain below average. The wheat harvest is forecast at 3.7 million tonnes, more than double last year’s poor level but still about 15 percent below the average. By contrast, in Tunisia prospects are less favourable and smaller crops are expected this year, mainly as a consequence of insufficient soil moisture at planting and subsequent erratic rains in the main growing areas. In spite of government incentives to farmers to increase production, wheat output is provisionally forecast to decrease from last year’s 1.4 million tonnes to some 870 000 tonnes. A below-average barley output is also anticipated. North African countries have been seriously affected by high international cereal prices due to their high dependence on imports. Governments have implemented a series of measures aimed at offsetting the sharp increase in world prices, including the waiving of tariffs, price controls and subsidies, which have put a considerable strain on public finances. In Algeria for example the bread subsidy system is estimated to cost the Government about USD 50 million each month. In spite of these measures inflation continues to accelerate across the subregion: In Egypt, the year-on-year rate of inflation reached 16.4 percent in April 2008 up from 6.9 percent in December 2007, driven mainly by price increases in the food sector where the year-on-year rate of inflation jumped from 8.6 percent in December 2007 to 22 percent in April 2008. The anticipated increase in wheat production, notably in Morocco and Egypt, is expected to ease the effects of rising international commodity prices on access to food in these countries. Even in Tunisia where production is forecast to decline significantly, consumer price inflation decelerated for the first time in almost a year to 5.3 percent in May. The arrival of the new local harvest to the market pushed food price inflation down to 7.1 percent in May from 8.1 percent in April. |