Analysis of cereal grain consumption trends and drivers in Malawi

Abstract

Malawi’s agri-food system, like those of most other agro-based economies, has experienced significant changes in food consumption driven by changes in various factors at the individual, household, and national levels. Several policy instruments and development initiatives, including the economy-wide Structural Adjustment programs (SAPs), have been implemented to unlock cereal-grain production and marketing potential to improve consumption. At the country-level, production levels and other structural socioeconomic factors such as changes in per capita incomes, urbanisation, and food prices, facilitate the consumption patterns of cereal foods. However, trends and determinants of cereals in Malawi remain understudied. As such, there is a need for rigorous analysis to inform government reforms in the cereal grain cereal subsector.

This study aimed to provide insight into the consumption of major cereals in Malawi by analysing trends and determinants using the Food Balance Sheet (FBS). To assess the suitability of the data used, the study data were subjected to unit root and cointegration tests to assess their suitability and avoid spurious results. The first objective examined the trends in the consumption of cereals in Malawi between 1990 and 2017 and identified emerging cereals in the sector. The focus of the second objective was to establish statistical relationships between various aggregate determinants of cereal consumption. The study used a dynamic Error Corrected Linearized Almost Ideal Demand System (ECLAIDS) model to quantify the effect of urbanisation, per capita income, population, and prices on consumption of cereals in Malawi. The cereal consumption models employed satisfied both the theoretical and statistical requirements.

The findings revealed a general increase in per capita consumption of cereals in Malawi between 1990 and 2017. Furthermore, there was a substitution of cereals between maize and rice and maize and wheat, even though wheat was not commonly grown in Malawi. In absolute terms, the per capita consumption of sorghum and millet has remained relatively low, with almost fixed consumption patterns over time. Although its per capita consumption is declining, maize still exhibits a much higher per capita expenditure share than any other cereals.

The individual cereal consumption model estimates revealed mixed results with varying levels of statistical significance. The effect of urbanisation on per capita expenditure (a proxy for consumption) after correcting the unit-roots properties was significant only for rice and wheat. This implies no statistical evidence supporting the effects of urbanisation on maize, millet, and sorghum consumption over this period. The study found that own price significantly affected rice and wheat per capita consumption but not maize, millet and sorghum. Besides, GDP or economic growth significantly influenced the changes in the consumption of cereals in the long-run equilibrium.

The results suggested the need to review the maize policy, especially as rice and wheat are emerging as significant contributors to diets. The analysis also suggests that if Malawi succeeds in sustaining strong, broad-based income growth, there will likely be growth in the consumption of rice and wheat, particularly in urban areas. Therefore, this study recommends a domestic wheat production policy suitable for the Malawi agro-ecological zone as well as increased rice and maize production and value chain addition. Since rice and wheat consumption is more sensitive to their prices, these cereals must be considered the prime target for interventions to achieve food security and promote economic growth.