Staple Food Prices in Sub-Saharan Africa: An Empirical Assessment

By Cedric I Okou, John A Spray, Filiz D Unsal

July 8, 2022

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Cedric I Okou, John A Spray, and Filiz D Unsal. Staple Food Prices in Sub-Saharan Africa: An Empirical Assessment, (USA: International Monetary Fund, 2022) accessed November 8, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

This paper analyzes the domestic and external drivers of local staple food prices in Sub-Saharan Africa. Using data on domestic market prices of the five most consumed staple foods from 15 countries, this paper finds that external factors drive food price inflation, but domestic factors can mitigate these vulnerabilities. On the external side, our estimations show that Sub-Saharan African countries are highly vulnerable to global food prices, with the pass-through from global to local food prices estimated close to unity for highly imported staples. On the domestic side, staple food price inflation is lower in countries with greater local production and among products with lower consumption shares. Additionally, adverse shocks such as natural disasters and wars bring 1.8 and 4 percent staple food price surges respectively beyond generalized price increases. Economic policy can lower food price inflation, as the strength of monetary policy and fiscal frameworks, the overall economic environment, and transport constraints in geographically challenged areas account for substantial cross-country differences in staple food prices.

Subject: Consumption, Food prices, Foreign exchange, Imports, Inflation, International trade, National accounts, Prices, Real effective exchange rates

Keywords: Consumption, Consumption share, Disasters, Food insecurity, Food price, Food price inflation, Food price variation, Food prices, Generalized price, Global, Imports, Increase dummy, Inflation, Monetary policy framework, Price effect, Real effective exchange rates, SSA country group average, Staple food, Sub-Saharan Africa, Wars

Publication Details

Pages:

44
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2022/135
Stock No:

WPIEA2022135
ISBN:

9798400216190
ISSN:

1018-5941

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