Grain Watch: East African Grain markets and Trade Highlight

Prices of grain staples eased marginally as stocks in the markets were adequate owing to harvest from the main seasons of Tanzania and Uganda and carry overstocks from the previous marketing year.

In South Sudan, the protracted conflict continued to disrupt trade with high inflation and fuel prices pushing prices upwards. Burundi and Rwanda, prices gained marginally in the second quarter as the countries were in the lean season. However, cross border trade eased demand pressure. In Kenya, imports from the region pushed prices of grain staples below the five-year average with harvest realized from the previous long rains season still in stock due to cheaper imports from the region.

In Tanzania, prices decreased towards the end of the quarter as stocks improved with the Msimu crop harvest. Uganda supply was on an upward trend following the main season harvest. There were no far reaching trade restriction in the region in the quarter. The main seasons in Tanzania, Uganda, Rwanda and Burundi were above average with improved yields compared to last year as a result of adequate and well-distributed rainfall.

Trade in the second quarter decreased seasonally in most countries within the region following improved domestic stocks from the main season harvest hence, Burundi and Rwanda had shortterm self-sufficiency as harvest commenced the end of the second quarter with Tanzania and Uganda harvesting from the month of May and June respectively. Intraregional trade in the second quarter of 2018 experienced fewer tariff barriers after the lifting of trade bans and no food subsidy programs compared to same period in 2017.

In South Sudan, the government lifted the long standing subsidy on fuel therefore the cost of transport is expected to increase and this will be reflected in the price of food staples; Currently, t rains have compromised access to markets as most roads are seasonal. Field reports indicated that trade between Uganda and Tanzania through Mutukula was affected by localized restrictions following a trade ban by Tanzania on import of beans to manage the plummeting prices in the country. In retaliation, Uganda instituted a ban on rice from Tanzania which is the major trade commodity along the corridor. In Rwanda, the Kabale-Gatuna-Kigali road traffic was directed to Kagitumba border as the road was destroyed by rains cutting off trade temporarily in May.

There has been a ban on paddy rice imports from Tanzania as the Rwanda Government is currently promoting domestic production of the commodity after heavy investment on equipment and machinery to support the Rwanda rice value chain. Trade between Kenya and Uganda remained vibrant in the second quarter, as prices in the

Maize: In the second quarter, a total of 130,651.6MT was traded in the region. This was a 24% decrease from the previous quarter volumes and a 16% decrease compared to the same period last year. A look at the seasonal trend shows that exports from Tanzania into Kenya have increased steadily since last year as restrictions on trade were relaxed late 2017.

Tanzanian exports increased atypically in the first quarter as result of higher carry-over stocks occasioned by the ban on trade, however, decreased in the second quarter as stocks tightened seasonally. With the inbound Msimu crop in late May from the southern highlands, exports to Kenya, Burundi and Rwanda are expected to increase in the third quarter. Uganda on the other hand was the top regional exporter of the commodity accounting for 60% of the trade. Prices were noted to be lower in the Ugandan

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