Fsnau-Post-Gu-2012-Technical-Report

The purchasing power showed major improvements as indicated
by increased Terms of Trade (ToT) between labour/cereal as well
as goat/cereal from a year ago (Jun’11). The ToT between local
quality goat and red sorghum in the selected reference markets
increased significantly, by 400 percent (from 28kg/head to 140kg/
head). When compared to the first six months of 2012, ToT
between local quality goat and sorghum increased by 43 percent
(from 98kg/head to 140kg/head), while a slight decline (6%) was
recorded in August following an increase in cereal prices from
their June 2012 levels . The annual ToT comparison between red
sorghum/daily labour rate have also shown a significant increase,
of 200 percent, in the same selected reference markets (from
6 to 18kg sorghum/daily labour rate). Similarly, an increase of
29 percent was recorded for ToT between red sorghum/daily
labour rate in January-June 2012. However, the ToT declined
in August 2012 (17%) as a result of reduced labour rates from
their June 2012 levels.
Imported commodity prices indicated a declining trend in all of the
Gedo markets. Rice prices decreased by 33 percent, vegetable
oil by 36 percent and sugar by 37 percent compared to a year
ago. The same declining trend was observed in the first half of
the year (9%- rice; 5%-vegetable oil and 24%-sugar). However,
in August 2012 imported commodity prices indicated a mixed
trend in all the Gedo markets. Rice price decreased marginally
(4%), vegetable oil increased (12%) while sugar prices recorded
no changes from the June 2012 levels.
Income Sources
Income from crop sales and agricultural labour opportunities for
poor households in the riverine and agropastoral communities
decreased this season due to the poor seasonal performance
(complete sorghum failure). However, the daily labour rates
for those who engaged in the off-season, cash crop and fruit
production activities indicated an increase. For example,
labour wage rates increased by 13 and 6 percent compared
to a year ago and the first six months of 2012, respectively. In
the riverine communities, which experienced complete crop
failure (sorghum), the poor household had no cereals for sale.
Nevertheless, they are expected to benefit from cash crop
labour and coming Deyr season farm activities (15 days/month).
Kidding and calving is expected from September 2012 for all the
species. As such, average livestock milk production and income
from its sale is expected to increase amongst the agropastoral
and pastoral communities in the region.
Additionally, income accruing from livestock sales (local quality
goat) has considerably improved due to increased livestock
prices. Specifically, the livestock prices increased by 82 percent
from a year ago and by 15 percent in January-June 2012. In
August 2012, prices exhibited a further eight percent increase.
The favourable livestock prices are due to the good livestock
body condition, increased demand for Ramadhan (Jul ’12) and
the Hajj (Oct-Nov ’12). Camel milk prices on the other hand have
also increased by 12 and 61 percent more than a year ago and in
the first six months of 2012 in all the markets. Camel milk prices
continued to increase in August 2012 (8%) due to decreased
supply in the markets.
Figure 27: Terms of Trade Local Quality Goat to Red
Sorghum 1Kg (Bardera Market)
Figure 28: Terms of Trade Daily Labour to Red Sorghum
(Bardera Market)
Good Tomato Crop. Luuq ,Gedo, FSNAU, July 2012
Coping Strategies
Various coping mechanisms are commonly employed by the
poor to meet their food/non-food needs. Main coping strategies
amongst the poor households include: food purchase on
credit, self-employment (bush products), increased seeking
of social support from relatives (inside and outside) such
as zakat, remittances, gifts and crop sharing amongst the
riverine communities. In the projected period, some levels of
humanitarian assistance is expected.
FSNAU Technical Series Report No. VI 48
Issued October 18, 2012
Regional Analysis
47