Market Highlights
The US$/SSP exchange rates exhibited daily fluctuations for the better part of April 2016. The local currency gained slight ground against the USD in the intervening period of signing of the Compromise Peace Agreement in the last two weeks of April, only to resume loosing trends thereafter and was exchanging at SSP 36-39/1$ in third week of May in the black market. The persistent shortage of dollars continued to dis-incentivize imports into the country during the reporting month.
The fuel crisis, characterized by shortages, hoarding and informal sale on road sides at inflated costs, continued for the fifth straight month in 2016, disrupting road movements and trade. In the black market, diesel costed as high as SSP 150/litre in Bentiu, Bor and Malakal but was slightly lower in Juba (SSP 70-100).
The nominal prices of sorghum, maize, beans, cooking oil and wheat flour continued rising trends in most markets and are significantly higher than their levels a year ago and the long-term mean. The prices of white sorghum, for instance were highest in Wau and Kuajok, going for as much as SSP 88 and 95/malwa, respectively during the reporting month.
In the May-July period, prices of staple foods are expected to continue rising to peak in July while purchasing power will be reduced for many households in line with lean seasonal trends. The dollar and fuel crisis is likely to persist as most areas become inaccessible during the rainy season, further limiting trader’s stocking capacity. The formation of the Transitional Government of National Unity (TGoNU) signals positive prospects for recovery of livelihoods, trade and market infrastructure but the economic gains are unlikely to be instant. The high food prices will limit household’s access to food and as a consequence heighten seasonal vulnerability to food insecurity among market-dependent populations especially the urban poor and those with huge consumption gaps in rural areas.