In this issue:

Zimbabwe: Report Projects Massive Grain Deficit

Cost of Grain Production in South Africa Skyrockets

Zimbabwe: Report Projects Massive Grain Deficit

March 16 (EIRNS)—While campaigning for re-election, President Robert Mugabe said that Zimbabwe is faced with another food deficit this year, according to the Zimbabwe Guardian March 5. Mugabe said the government had already ordered 500,000 tons of maize to mitigate against possible hunger and starvation in the country. A report co-sponsored by the government indicated that Zimbabwe will need to import grain, because only 14% of the land targeted for maize had been planted by December, and much of this crop was adversely affected by fertilizer shortages, according to the Zimbabwe Financial Gazette) March 6. The report advised the creation of contingency plans for food imports, noting that farmers had only received 10% or less of the required fertilizer during the current 2007-08 Summer farming season.

The "First Round Crop Assessment Report" was issued by a joint team comprising the Ministry of Agriculture; Operation Maguta, a program run by the military; the UN Food and Agricultural Organization (FAO); the Famine Early Warning Systems Network (FEWS-NET); and the Meteorological Office.

Zimbabwe faced a grain deficit of about 891,000 metric tons in 2007—almost 50% of its 2006 harvest, according to a joint Crop and Food supply assessment mission by the FAO and the World Food Program. It is expected that Zimbabwe will end up with an even higher maize deficit than in 2007, according to the latest report from the USAID-funded FEWS-NET.

Cost of Grain Production in South Africa Skyrockets

March 14 (EIRNS)—The rise in production cost of grains, including wheat and maize, is "mind-boggling," according to Neels Ferreira, chairman of Grain S.A., who was cited in a SAPA (South African Press Association) release that was published in the South African Mail and Guardian online, March 13. The cost of production for wheat due to be planted in the coming months, according to the report, will increase on average by 63%, according to Ferreira. This included the cost of seed, fertilizer, chemicals for weed and pest control, fuel, repairs and spares, marketing costs, and interest on production credit.

Measured on a year-on-year basis, all cost components showed increased price levels, including fertilizers, up 98%; seed, up 24%; diesel, up 55%; and interest on production credit, up 63%.

Budgets for the upcoming production season, starting in October, indicate that production costs of various crops would increase by between 30% and 50%.

The biggest increases were in the price of fertilizers, up 58%; diesel, up 33%; herbicides, up 42%; and interest on production credit, up 30%.

Warning that the price of inputs will stay high, Ferreira stated, "The price of inputs very seldom decreases, and it must be accepted that the present price levels will continue; whereas grain prices are much more volatile and there is no guarantee that they will remain high, according to the report.