Wednesday, July 24, 2024
BusinessTeff prices skyrocket, farmers blame authorities, hoarding intensifies

Teff prices skyrocket, farmers blame authorities, hoarding intensifies

Residents of Addis Ababa and other major Ethiopian cities are being slammed by an exploding teff price, which has reached above 7,000 birr per quintal.

The significant price increase puts the staple out of reach for the majority of consumers, contradicting officials’ claims that food inflation is under control.

Food inflation reached 33.6 percent in January 2023, up from 33.9 percent the previous month, according to the Ethiopian Statistical Service (ESS).

The rate is much lower than the change in the price of teff, which is a staple food for most Ethiopians and has gone up at least 50 percent since last year.

Traders blamed farmers for the price hike, saying that the farmers are hoarding the commodity, which has caused a shortage in the market.

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In urban areas, cooperative unions control the lion’s share of the market. They buy the cash crop from the farmer and sell it to consumers with a low profit margin. Ude Cooperative, situated in Oromia, is one such entity that provides the crop to Addis Ababa’s consumer unions and traders.

“Farmers don’t want to sell their harvested teff to us because we pay much less than the traders do,” said Abera Mengiste, head of Ude Cooperative.

Oromia Cooperative Agency, the entity in charge of overseeing cooperative unions, reports that only two of the 10 cooperatives tasked with purchasing teff from farmers actually get the product from the farmers.

“The farmers do not want to sell, but stockpile what they produce,” Eshete Gemeda, a senior official of the Agency, told The Reporter.

In Oromia, cooperatives aren’t allowed to buy teff at the market rate because they are only allowed to use the price set by the regional government. They can now pay 4,500 birr for teff that is of the highest quality (which is often referred to as “magna”). Traders pay as much as 6,000 birr for the same quality of the commodity.

Farmers blame authorities in Oromia Region for their oversight while setting the price of teff.

“The regional government’s pricing does not account for the costs we pay while planting the crop. The cost of fertilizer for this year’s planting was more than double, with the price of improved seed showing a drastic upsurge likewise,” Dechasa Adugna, a farmer in Becho Woreda, Awash Guge, South West Shewa Zone, told The Reporter.

It is a sentiment shared by most farmers cultivating in the region.

“During harvest, we pay daily laborers in addition to the costs of buying improved seed and fertilizer. The prices of several of the foods we eat, such as cooking oil and sugar, have also gone up recently, adding to our financial burden,” said Berhanu Angasa, another farmer involved in the production of teff in South West Shewa.

In 2021, during the Meher harvest season, almost 2.8 million farmers harvested a total of 26.9 million quintals of teff in Oromia. About the same time, the crop spread throughout 1.3 million hectares of land. In comparison, in the Amhara Region, 2.7 million farmers harvested 20.9 million quintals of teff from one million hectares during the same period of time. The Ethiopian Statistical Agency has not yet released statistics for the next year or season.

Since teff’s output and land use have fallen over the last five years, the price of this staple crop has skyrocketed, increasing by a factor of four. Keseem Cooperative Union is led by Amekele Tarkegn and is situated in Amhara Region, where farmers are free to sell their produce at the current market price. Amekele believes that the current jump in the price of teff is attributable to the meteoric rise in demand for the commodity in Tigray.

“There is a great demand for teff in Tigray; hence, a considerable quantity is transported there. And because of the conflict that has been going on for two years, the local farmers have not been able to produce very much. Insufficient demand may be behind the current price increase,” said Amekele.

Contributed by Helen Tesfaye

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