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

IMF Working Papers, July 8, 2022

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Study analyzes 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.
External factors drive food price inflation, but domestic factors can mitigate these vulnerabilities.
Pass-through from global to local food prices estimated "close to unity" for highly imported staples.
Staple food price inflation is lower in countries with greater local production and among products with lower consumption shares.
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 frameworks, overall economic environment, and transport constraints in geographically challenged areas account for substantial cross-country differences in staple food prices.

High vulnerability to global food prices: pass-through from global to local food prices estimated "close to unity" for highly imported staples.
Global food price movements are a primary driver of local staple food inflation across the studied countries and products.

Greater local production is associated with lower staple food price inflation.
Products with lower consumption shares exhibit lower staple food price inflation.
Transport constraints in geographically challenged areas contribute to higher staple food prices.

Natural disasters: produce "1.8 percent" staple food price surges beyond generalized price increases.
Wars: produce "4 percent" staple food price surges beyond generalized price increases.

Economic policy can lower food price inflation.
Strength of monetary policy and fiscal frameworks influences staple food price dynamics.
Improving local production and addressing transport constraints can mitigate vulnerability to global price shocks.
Overall economic environment plays a substantial role in cross-country differences in staple food prices.