Household incomes to remain subdued
NOTWITHSTANDING a good agricultural season and a projected bumper harvest, incomes for general households will remain depressed this year, weighed down by economic challenges, according to a new report by Fewsnet.
Government said last week it expected maize output of between 2,5 million and 2,8 million metric tonnes this year.
Cash crops are also expected to attain above average harvests.
Good rains have motivated an increase in the uptake of farming activities across the country.
These developments have led to projections that farmers will sell more produce this season and improve their incomes.
But in its latest report covering February to September 2021, Fewsnet said there would be no remarkable change in household incomes as COVID-19 will continue to affect the economy.
“Local and international remittances towards poor rural and urban households are expected to remain below average throughout the outlook period, driven by national economic challenges and continued direct and indirect impacts of COVID-19 domestically and globally,” the report noted.
“Southern areas of the country are expected to be the worst-affected as remittance flows from South Africa are expected to continue to be constrained. Based on trends, it is expected income-earning activities, primarily in the informal sector, such as cross-border trade, petty trade, self-employment, will to continue to depend primarily on the interaction between the poor macroeconomic conditions and indirect impacts of the COVID-19 pandemic. Incomes are expected to remain below-average through at least late 2021,” the report noted.
It said there would be significant improvements in the harvesting and sale of wild products in most areas during the outlook period following favourable rainfall.
National crop production for 2021 is expected to be above-average due to favourable rainfall and access to some inputs the paper noted.
But it said some yield reduction was expected due to heavy leaching, waterlogging of soils, lack of fertilizers, and pests in some areas.
“Maize grain and meal prices are projected to remain significantly above average in Zimbabwe dollar and United States dollar terms between February and March, driven by low supply, high demand, and continued poor macroeconomic conditions. Prices are expected to decline with the harvest starting in April, though remaining above average in Zimbabwe dollar terms while below average in US dollar terms. Poor households in deficit-producing areas are expected to start depleting own-produced stocks around August/September, and that is when maize grain prices are expected to start increasing,” said Fewsnet.
It said incomes from cash crop sales will be dependent upon sales conditions on the market.
“Agricultural and non-agricultural labour opportunities are anticipated to improve compared to previous years. However, they are expected to remain below-normal due to ongoing macroeconomic challenges, impacts of COVID-19, and the consecutive poor seasons. In-kind labour payments are expected to be near average starting in April/May,” Fewsnet.
“Pasture and livestock conditions will most likely be favourable through at least mid-2021 across the country, driving favourable livestock prices. Starting in mid to late 2021, in semiarid areas, pasture and water availability are expected to decline slowly, driving some deterioration in livestock conditions. However, conditions are not expected to be as poor as in previous drought years,” the report added-newsday
