Market Highlights
The cost of living in South Sudan sustained rising trends during the reporting month. The Consumer Price Index (CPI) increased in June by 310% year-on-year, the highest in the world and historic ever recorded in the country. The recent fighting in Juba disrupted markets and trade, significantly reducing food availability and consequent remarkable increase in food prices in the capital to as high as 45-80% for legumes, 12-58% for cereals and up to 70-80% for fuel within one week following the cessation of hostilities.
The South Sudanese pound (SSP) weakened further against the United States (US) dollar in the black market exchanging at an average 48 SSP/1US$ down from 38SSP/1US$ in May. The SSP lost further ground against the dollar in the immediate aftermath of renewed armed fighting in the capital, exchanging at an all-time high of 60 SSP/1US$.
The country is still experiencing acute fuel shortages, characterized by erratic supply and unwillingness of dealers to sell at government controlled price of SSP 22/litre. Accordingly, hoarding and black market sales of fuel at premium prices was on the rise all over the country. Fuel problem was aggravated by the recent fighting in Juba and consequent disruption of Nimule border operations.
High cost of transportation, unpassable roads due to seasonal rains and insecurity reversed expected price reduction gains for locally produced cereals following the start of early green harvests in parts of Equatoria, Unity, Lakes and Jonglei. Notably June-July marks the peak of the lean season in many areas in Eastern Equatoria, Upper Nile, Northern Bhar el Ghazal and Warrap, partly explaining the price increases for locally produced cereals. Aweil Town in Northern Bhar el Ghazal has the highest (about SSP 100/ 3.5 kg malwa) cereal prices in the country. Prices of most imported commodities also sustained rising trends across the country in line with currency depreciation, dollar shortages and difficult business environment.
In the outlook, food prices are expected to increase seasonably in July-August period in line with reduced functionality, low market stocks and poor road access. Households rely highly on markets particularly the urban poor will be the worst hit. The expected early green harvests will bring temporary reprieve for many households in localized net producing areas but the effect will not be widely felt in deficit producing areas due to poor market integration- insecurity and poor roads will prevent trade flows. Beyond August, household food availability and access is expected to improve especially during the main harvest in November-December in parts of Warrap, Northern Bhar el Ghazal and Upper Nile. The recent looting of WFP food and other items in the main warehouse in Juba by armed elements will likely put considerable strain on vulnerable populations in PoCs and IDP camps who rely on humanitarian assistance.