NFRA food reserves climb to ten-year high

TANZANIA: TANZANIA monthly food reserve has increased to almost ten years high thanks to bumper harvests of cereals and government initiatives to buy the harvests from the farmers at market price.

According to Bank of Tanzania’s latest monthly economic review, food stock at the National Food Reserve Authority (NFRA) , in February reached 326,172 tonnes the highest since June 2015 when it reached.

However, the largest monthly stock in the history of country was 466,583 tonnes recorded in December 2014 and the lowest was 26,802 tonnes in May 2013.

Dr Hildebrand Shayo, economist and cum-investment banker, told the ‘Daily News’ on Tuesday that large food reserve is a good sign for the economic stability since it assists to contain inflation.

“Food basket has heavy weight on calculating the consumer price index, the higher the stock the better the stability of commodities prices,” Dr Shayo said.

Additionally, he said huge food reserve assures the ability of the authorities to assist the society in case of famine caused by natural calamities hence saving the country’s foreign currencies.

“This means that increasing food purchases sheds light and is beneficial for farmers in the country to profit from their agriculture and also reduces the situation where farmers smuggle food and other crops out of the country.”

He said the adequate food stock is a sign for food sufficient of an economy and warranting export to sell the excess amount to earn the much-needed foreign currencies.

Also Read: Kisanga endorsed as new TCCIA chief executive officer

Some analysts advised the National Food Reserve Authority (NFRA) to sustain the stock and avoid it to be a one-time occurrence.

The data showed that the monthly food stock was on the increasing trend in the last three years leaping from 38,053 tonnes in April 2020 to 326,172 in February.

The University of Dar es Salaam, Environmental Scientist and Economist, Dr Robert Katikilo, said the presence of good food reserve is a sign of economy growth.

“This will contribute to the increase of GDP through farmers well-being and taxes raised from the food value addition chain. “And, we also need to have sound policies to ensure food and agricultural sustainability plus its value addition chain in the country,” said Dr Katikilo.

BoT latest monthly economic review showed that food inflation remained relatively low, albeit with a slight uptick to 1.8 per cent in February from 1.5 per cent in the preceding month.

“This outturn is associated with adequate food supply in the domestic markets coupled with eased demand from neighbouring countries,” the report showed.

Prices of essential food crops also exhibited a downward path the path observed for almost a year.

“This performance underscores the stability of the domestic food market, contributing to the overall economic stability,” the report said.

Generally, inflation remained steady at 3.0 per cent for the past three months since last December. “The stability is attributed to an ample domestic food supply and reduced imported inflation, driven by a moderation in global market prices,” BoT report said.

Notably, core inflation, a key driver of overall inflation dynamics, climbed to 3.7 per cent the highest since last February up from 3.2 per cent recorded in the previous month.

“This outturn is mainly attributed to the pass-through effects of adjustments in domestic energy prices,” the report added.

On monthly basis, the food reserve increased by 20 per cent form 270,984 tonnes in January to 326,172 tonnes in February

Related Articles

Back to top button