Grain marketing policies and food aid in Lesotho : implications for food security.

Abstract

Food security is a necessary condition for the survival of every nation, household and individual. With the failure of the food self-sufficiency policy in Lesotho alternative food security objectives are suggested. Supply and demand factors need to be considered to develop a holistic and balanced view of food security. Maize marketing and pricing policies as well as food aid impact on food (in)security since they affect the movement and trade of maize grain and maize meal, the primary staple of Lesotho. A study was conducted amongst policy makers, government officials, retailers and millers in Lesotho to review the maize marketing system and procedures for setting maize prices at producer, mill-gate and consumer levels. Set prices distort price signals which influence decisions to allocate and distribute resources to provide goods and services for markets. Lesotho is a net importer of maize grain, the major staple, implying that maize pricing and marketing policy affect food security. Results indicate flexible informal marketing channels, fixed formal marketing channels and declining real producer, mill-gate and consumer prices in recent years. Falling real South African Maize Board export grain prices and evidence of subsidies to commercial Lesotho mills explain these price trends. Changes to the one channel formal marketing system and nationally administered price structure that would encourage an open market system with less restrictive interregional maize trade are recommended. The extent of food aid dependence in Lesotho and the possibility of reducing reliance on food aid are also analyzed. Primary data on food aid statistics were collected from various food aid agencies and institutions, supplemented with secondary data obtained from government documents. Results show that reducing food aid dependence is unlikely in the longer term, which has implications for the level of food (in)security in Lesotho. Food aid to Lesotho supplements commercial imports to meet the shortfall in local cereal production. It improves nutritional and consumption levels of vulnerable households, but shows no correlation with producer and consumer prices. Food aid reduces government budgetary expenditures on food, saves on foreign exchange to pay for food imports, and when used as 'food for work' to build infrastructure, has multiplier effects on agricultural growth, leading to expanded income and employment in other sectors of the economy. Poverty alleviation measures and income generating activities must be the primary focus if food aid dependence is to be reduced.