Somalia's consumer price inflation decreases from 6.06% in December (yoy) to 5.57% in January. Food price inflation is down to 6.72% from 17.54%

[bidenkulaha]

Check my edit, also Ethiopia imports 25 % of their wheat whilst Somalia imports nearly 100 % of its wheat. And when the Ukraine war happened, they increased wheat production by 70 %. Ethiopia is a food self sufficient country whilst Somalia imports over 75 % of its food.

We will always be dependent on the international market for our food supply, because since 1970 we lost the ability to be food self sufficient due to rapid population growth. Our water resources and arable land statistically cannot support more than 4 million people.

First of all wheat is a global commodity, prices in theory should fall in Ethiopia too. Yet inflation is accelerating. This implies a failure of government policy on other aspects of the economy. Hence why I used this and Egypt as a comparison. Also add on Ethiopia, some claim they import 25%. Government data according to Bloomberg says they import 42% (27% and 15% from Ukraine and Russia). Regardless whatever is the case they are a net importer despite increased wheat production so global prices will have an effect.

Secondly the wheat we get is actually imported from Egypt, which is imported from Ukraine and Russia. Egypt can’t produce food. So any fall should be replicated there if the reason for Somalia’s fall in food inflation was because of Ukrainian wheat costs.

Egypt's inflation continues to surge as food prices rise

CAIRO (AP) — Egypt's annual inflation surged to a new high in January as the country continues to battle ongoing price hikes and a depreciating currency, the Egyptian statistics bureau said on Thursday.

apnews.com

So again the points you both made aren’t of much relevance looking at neighbouring countries and those with similar dependencies on imports.

I would hazard a guess given my earlier comment and that wheat isn’t the only food we eat, this is much more of a story of increased political stability in the country, reducing trade barriers, Shabaab losing ground in food producing L.S and M.S, reduced checkpoints, easier transport of goods because of newly open supply routes.

 

[World]

First of all wheat is a global commodity, prices in theory should fall in Ethiopia too. Yet inflation is accelerating. This implies a failure of government policy on other aspects of the economy. Hence why I used this and Egypt as a comparison. Also add on Ethiopia, some claim they import 25%. Government data according to Bloomberg says they import 42% (27% and 15% from Ukraine and Russia). Regardless whatever is the case they are a net importer despite increased wheat production so global prices will have an effect.

Secondly the wheat we get is actually imported from Egypt, which is imported from Ukraine and Russia. Egypt can’t produce food. So any fall should be replicated there if the reason for Somalia’s fall in food inflation was because of Ukrainian wheat costs.

Egypt's inflation continues to surge as food prices rise

CAIRO (AP) — Egypt's annual inflation surged to a new high in January as the country continues to battle ongoing price hikes and a depreciating currency, the Egyptian statistics bureau said on Thursday.

apnews.com

So again the points you both made aren’t of much relevance looking at neighbouring countries and those with similar dependencies on imports.

I would hazard a guess given my earlier comment and that wheat isn’t the only food we eat, this is much more of a story of increased political stability in the country, reducing trade barriers, Shabaab losing ground in food producing L.S and M.S, reduced checkpoints, easier transport of goods because of newly open supply routes.

IMF:

• Impact of Russia’s war in Ukraine on global food supply and prices: Russia’s war in Ukraine has aggravated food insecurity. In 2021, Somalia imported 80 percent of non-milled wheat directly from Ukraine and 53 percent of the food assistance (primarily wheat) provided through the World Food Program (WFP) is sourced from Ukraine. Given that almost two-thirds of overall weekly household consumption food expenditure is accounted for by cereals (mostly consisting of maize, sorghum, and imported rice and wheat), the impact of the war in Ukraine on food insecurity is significant. Moreover, global food inflation has accentuated domestic food price inflation to 70 percent for cereals in June 2022 from 2 percent a year earlier. This has led to reducing access and availability of staples in Somalia, particularly to the poor.

Domestic production only satisfies
22 percent of per capita cereal needs on average, and the remainder is covered through food imports and a chronic dependence on food aid.

https://www.imf.org/-/media/Files/Publications/CR/2022/English/1SOMEA2022004.ashx

If you still can’t understand:
>78 % of Somalia’s cereal is imported or food aid
>66 % of weekly food consumption is on cereal
>Global cereal inflation was 70 % in June 2022
>80 % of wheat imported from Ukraine
>Ukraine wheat inflation was 150 % in June 2022

 

[Erythrean]

Interesting observation, but is it not weird how the focus on the possibility of migration of Somalis outside of Somalia, into EAC is a concern? When it be a drop in the ocean compared to hundreds of millions of people that will make up the EAC and later on Federation.

The EAC should never be joined if it’s going to end up as a federation. If it’s a simple community with common interests in working together for economy, trade, infrastructure.. It would be alright.

 

[Erythrean]

IMF:

• Impact of Russia’s war in Ukraine on global food supply and prices: Russia’s war in Ukraine has aggravated food insecurity. In 2021, Somalia imported 80 percent of non-milled wheat directly from Ukraine and 53 percent of the food assistance (primarily wheat) provided through the World Food Program (WFP) is sourced from Ukraine. Given that almost two-thirds of overall weekly household consumption food expenditure is accounted for by cereals (mostly consisting of maize, sorghum, and imported rice and wheat), the impact of the war in Ukraine on food insecurity is significant. Moreover, global food inflation has accentuated domestic food price inflation to 70 percent for cereals in June 2022 from 2 percent a year earlier. This has led to reducing access and availability of staples in Somalia, particularly to the poor.

Domestic production only satisfies
22 percent of per capita cereal needs on average, and the remainder is covered through food imports and a chronic dependence on food aid.

https://www.imf.org/-/media/Files/Publications/CR/2022/English/1SOMEA2022004.ashx

If you still can’t understand:
>78 % of Somalia’s cereal is imported or food aid
>66 % of weekly food consumption is on cereal
>Global cereal inflation was 70 % in June 2022
>80 % of wheat imported from Ukraine
>Ukraine wheat inflation was 150 % in June 2022

We should spread our food reliance thin rather than put all our eggs in one basket. Like China is completely reliant for out sourcing food and it has multiple countries to choose from so if they go through such turmoil that Ukraine is going through, they can easily switch to other partners.

 

[bidenkulaha]

IMF:

• Impact of Russia’s war in Ukraine on global food supply and prices: Russia’s war in Ukraine has aggravated food insecurity. In 2021, Somalia imported 80 percent of non-milled wheat directly from Ukraine and 53 percent of the food assistance (primarily wheat) provided through the World Food Program (WFP) is sourced from Ukraine. Given that almost two-thirds of overall weekly household consumption food expenditure is accounted for by cereals (mostly consisting of maize, sorghum, and imported rice and wheat), the impact of the war in Ukraine on food insecurity is significant. Moreover, global food inflation has accentuated domestic food price inflation to 70 percent for cereals in June 2022 from 2 percent a year earlier. This has led to reducing access and availability of staples in Somalia, particularly to the poor.

https://www.imf.org/-/media/Files/Publications/CR/2022/English/1SOMEA2022004.ashx

You’re making my point for me, Somalia suffered from food inflation partly as a result increased global prices. Just like its neighbours. But yet we’re seeing food inflation fall, unlike our neighbours.

I make the point this is because Somalia is benefiting from increased stability. Which we lacked in Farmaajo’s years so suffered more from accelerating inflation. Which inshallah is now behind us it seems, too early to declare victory given we’re in yet another drought season.

Have a look at the graph in this report. We were benefiting from deflation in cereal prices well below the inflation rate of the global prices till late 2020 when the government began to collapse. Suddenly Mogadishu price inflation for cereal ballooned way above the global price inflation despite for years being lower. 70% increase in Mogadishu vs 35% globally.

Shabaab gained ground in Hirshabelle and SWS and Beledweyne was under siege. Similarly Afgoye had many Shabaab checkpoints. So food was becoming more expensive to transport as Shabaab taxed each truck $1,000. Xamar was surrounded by Shabaab and Mogadishu port was taxed by Shabaab and ISIS making imports more expensive. Shabaab also then kicked out farmers from their land if they didn’t pay ‘tax’ before they’d even begun farming.

In the report it’s mentioned that we have a structural problem with food inflation with Shabaab’s control over Hirshabelle and SWS.

Removing Shabaab is likely to have a significant effect.

You’re best addressing Egypt’s rising food prices this year and Ethiopia despite the fall in global wheat prices before you throw another IMF report detailing Somalia’s food inflation which is an impressive outlier

 

[bidenkulaha]

Interestingly despite a significant rise in imports from Kenya for khat after lifting the ban and falling inflation of all other goods, prices of ‘narcotics’ is soaring. Likely to be the increased taxes on khat.


Edit: Just found this from a couple months ago, prices hiked from $16 to $50 apparently.

We should spread our food reliance thin rather than put all our eggs in one basket. Like China is completely reliant for out sourcing food and it has multiple countries to choose from so if they go through such turmoil that Ukraine is going through, they can easily switch to other partners.

We should have more self reliance on food production but Somalia has little arable land. I don’t mind us having more imports as we should always aim for cheaper food costs. Not every country can become an exporter or completely self reliant in food. Good local agriculture economy sure but invest in energy where we have massive potential.

 

[GaradShabeel]

The EAC should never be joined if it’s going to end up as a federation. If it’s a simple community with common interests in working together for economy, trade, infrastructure.. It would be alright.

Too late. Federation is the end sight and goal, for the EAC.

I personally agree with your stance on EAC, but many people on this forum stands completely in contrary, and according to them apparently it also has a good amount of support in Somalia.

The decision of accepting EAFederation will single handedly push the IC to recognize SL, as by then Somalia as a sovereign country will cease to exist.

In any case, hopefully a referendum will be put in place if it indeed comes to that stage.

 

[bidenkulaha]

Too late. Federation is the end sight and goal, for the EAC.

I personally agree with your stance on EAC, but many people on this forum stands completely in contrary, and according to them apparently it also has a good amount of support in Somalia.

The decision of accepting EAFederation will single handedly push the IC to recognize SL, as by then Somalia as a sovereign country will cease to exist.

In any case, hopefully a referendum will be put in place if it indeed comes to that stage.

Federation will take decades, even the countries within it aren’t keen. However a custom union so we strengthen our hand in negotiations with other economic blocks like the EU, US, China. And a single market so we can have free movement of goods, capital and labour is something we can benefit from. It’s not actually that far fetched to say Somalis are very entrepreneurial and can become a very big economic players within Tanzania, Uganda, Rwanda, Kenya. We have a major benefit due to our diaspora too.

 

[GaradShabeel]

Federation will take decades, even the countries within it aren’t keen. However a custom union so we strengthen our hand in negotiations with other economic blocks like the EU, US, China. And a single market so we can have free movement of goods, capital and labour is something we can benefit from. It’s not actually that far fetched to say Somalis are very entrepreneurial and can become a very big economic players within Tanzania, Uganda, Rwanda, Kenya. We have a major benefit due to our diaspora too.

Agreed sxb. Personally, I'm not fond with the aspect of EAC turning into a Federation, something that may occur in the future. Other than that, I'am all in favor of the rest. It will be a tremendous benefit for Somalia & opportunities for Somalis living elsewhere.

 

[Heavy Mountains]

We should have more self reliance on food production but Somalia has little arable land. I don’t mind us having more imports as we should always aim for cheaper food costs. Not every country can become an exporter or completely self reliant in food. Good local agriculture economy sure but invest in energy where we have massive potential.

Somalis are still using old technology in farming, we are not using modern and scientific approaches to farming.

Check the video below, he talks about the soil type found in Southern Sool, Eastern Somali region and the Mudug/Galgaduud region and with soil salinity control we could have industrial farming in those regions.

 

[Mr. Wabrii]

Somalis are still using old technology in farming, we are not using modern and scientific approaches to farming.

Check the video below, he talks about the soil type found in Southern Sool, Eastern Somali region and the Mudug/Galgaduud region and with soil salinity control we could have industrial farming in those regions.

This is great video, If you drill and add pipes and lets the water run, the salt will run out with the water, and now Instead of Hard Salt Soil you can have soil you can plant all fruits and vegies.

If you check areas and the soil goes deep without any Rock, then you can clear that area and farm. Galmudug would greatly benefit from this kind of Farming.

 

[Heavy Mountains]

This is great video, If you drill and add pipes and lets the water run, the salt will run out with the water, and now Instead of Hard Salt Soil you can have soil you can plant all fruits and vegies.

If you check areas and the soil goes deep without any Rock, then you can clear that area and farm. Galmudug would greatly benefit from this kind of Farming.

Somalis today rely on shallow wells, if we develop our water infrastructure and also use sustainable groundwater management practices. We would have enough water to irrigate our fields and drinking water for our people and livestock.

 

[World]

You’re making my point for me, Somalia suffered from food inflation partly as a result increased global prices. Just like its neighbours. But yet we’re seeing food inflation fall, unlike our neighbours.

Actually,

Somalia’s food inflation dropped 9.43% since May 2022.
Ethiopia’s food inflation dropped 10.1 % since May 2022.

I make the point this is because Somalia is benefiting from increased stability. Which we lacked in Farmaajo’s years so suffered more from accelerating inflation. Which inshallah is now behind us it seems, too early to declare victory given we’re in yet another drought season.

View attachment 255007

Have a look at the graph in this report. We were benefiting from deflation in cereal prices well below the inflation rate of the global prices till late 2020 when the government began to collapse. Suddenly Mogadishu price inflation for cereal ballooned way above the global price inflation despite for years being lower. 70% increase in Mogadishu vs 35% globally.

Shabaab gained ground in Hirshabelle and SWS and Beledweyne was under siege. Similarly Afgoye had many Shabaab checkpoints. So food was becoming more expensive to transport as Shabaab taxed each truck $1,000. Xamar was surrounded by Shabaab and Mogadishu port was taxed by Shabaab and ISIS making imports more expensive. Shabaab also then kicked out farmers from their land if they didn’t pay ‘tax’ before they’d even begun farming.

Al Shabab only have one isbaaro in their land, whilst FGS has numerous. Farmers are getting taxed even more today due to the fact that isbaaros have taken over Middle Shabelle. So how can food get cheaper? Between Xamar and balcad which is 30km there are 6 isbaaros

Farmers are even complaining that the isbaaros are robbing 30 % of their revenue now:

 

[Bowda-dheer]

Meanwhile in Ethiopia

Ethiopia has always been like that sometimes people would get in line for sugar because it’s rationed. Free trade in Ethiopia has always been shaky.

 

[bidenkulaha]