Strategic grain reserves and maize price stabilization in Malawi: What policies are feasible?

Jan Duchoslav and Nicholas Minot

No 47, MaSSP working papers from International Food Policy Research Institute (IFPRI)

Abstract: Maize price instability remains a major policy challenge in Malawi, where most households depend on maize for both production and consumption. Many farmers sell maize after harvest, when prices are low, only to buy it back during the lean season, when prices are high. This paper examines whether Malawi's Strategic Grain Reserve, managed by the National Food Reserve Agency, can meaningfully stabilize maize prices. It reviews the sources of maize price volatility, assesses past government interventions—including minimum farmgate prices, trade restrictions, and public grain purchases and sales—and develops a conceptual framework for buffer stock operations. The analysis shows that while a strategic grain reserve can help mitigate the most extreme seasonal price movements, its effectiveness is severely constrained by limited storage capacity, financing and timing challenges, and, in particular, the market-determined import and export parity prices that govern cross-border trade. The paper argues that Malawi should retain its strategic grain reserve but calibrate its price-stabilization mandate to what is operationally feasible, while preserving the reserve's emergency and safety-net functions.

Keywords: strategic grain reserves; grain; maize; food prices; price stabilization; fiscal policies; Malawi; Africa; Sub-Saharan Africa; Eastern Africa (search for similar items in EconPapers)
Date: 2026-07-24
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Persistent link: https://EconPapers.repec.org/RePEc:fpr:masspp:183948

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