As droughts sweep across much of southern Africa threatening the food security of millions, value chains for other industries that depend on agriculture are also under threat.

In Zimbabwe, the livestock industry is being forced to import some 200,000 metric tonnes (mt) of maize to sustain stock feed production in 2016 following a poor harvest.

A severe El Niño weather pattern, exacerbated by the impacts of climate change, has caused a drought across southern Africa and parts of east Africa. Supplies of key crops such as maize are now in short supply.

The grain is a staple food for the bulk of the region’s population and a raw material for the agro processing and feed industries. Now, these sectors must survive on pricey imports.

Maize shortages are poised to push prices up all down the value chain. Higher dependence on imports may increase the food prices in South Africa by 20 percent across the board this year, according to some estimates.

In Zimbabwe, it costs $320 to $350 to import a tonne of maize from Mexico compared to $240 when it comes from neighbouring Zambia, whose harvest has also failed this year.

In 2014, a good harvest allowed Zimbabwe’s feeds sector to meet most of its requirements locally. However, due to a poor 2014-2015 rainy season Zimbabwe only managed to produce 742,000mt of maize leaving a gap of 650,000mt to feed populations, let alone to fuel industries.  

With all local white maize earmarked for human consumption, Israel Muchuchu, the chairman of the Stock Feed Manufacturers’ Association of Zimbabwe, says his industry has no choice but to import.

“To supply livestock farmers with stock feed, as well as keep the wheels of local industry turning and play our part in value addition, we are switching to yellow maize this year,” Mr Muchuchu told This Is Africa.

“Within the region, non-GM yellow maize is only available from Zambia, and to secure the balance we are looking as far afield as the Ukraine.”

Since dollarisation - the policy that swapped out Zimbabwe’s near-valueless national currency for a basket of foreign ones - Zimbabwe’s livestock industry has grown. Indeed, it is one of the few industries that has in the isolated, unorthodox economy.

Poultry has grown the most, but requires a lot of maize feed to sustain. Currently the industry consumes 68 percent of all feed produced in the country.

The cattle industry, which at first was hugely impacted by president Robert Mugabe’s expulsion of all white ranchers in the early 2000s, had recovered somewhat and is now valued at an estimated $2.5bn per year. However most farmers supplying the country’s beef industry are smallholders whose margins are narrow even in good years.

Costs of imports are driven up by poor logistics and coordination. Inspections fees on maize imported into Zimbabwe can be as high as $450 per truckload.

“Such regulatory costs...affect the viability of the livestock producer and ultimately increase the cost of meat and eggs and dairy products to the consumer,” Mr Muchuchu explains.

These difficulties in pricing for consumers are compounded by the country’s slow uptick in inflation and a  serious cash shortage countrywide.

South Africa’s crop fails

Zimbabwe is not the only country struggling to cope with shortages.

The maize industry plays a big role across the 15 economies of the Southern African Development Community (SADC), led by South Africa which usually produces 40 percent of the region’s maize.

However South Africa, traditionally a maize exporter, is also struggling. This year it will import about 3.8m tonnes of the grain. Prices are already up 45 percent year on year for the yellow variety, and 80 percent for white.

South Africa’s livestock industry had been thriving and well supplied with feed until this drought, its worst since the early 1980s.

According to industry association Grain SA economist Wandile Sihlobo, South Africa imported 1.8m tonnes of yellow maize for feed from South America and Ukraine in 2015 to make up shortfalls. That is expected to rise to 2.7m tonnes of imports in 2016/17.

Malawi and Zambia, the second and third biggest maize producers in the sub-region are also importing. Reports from Zambia indicate that farmers are deeply concerned by the ever-escalating cost of livestock feed.

Unfortunately these look unlikely to abate anytime soon. “All the negative news is already priced in – so, one can expect prices to remain at higher levels until mid-2017,” says Mr Sihlobo.

Extracted from "This is Africa," 30th March 2017.