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In this essay, CGD post-doctoral fellow Jenny Aker analyzes the performance of grain markets in Niger during its 2005 food crisis and uses the lessons of the past to identify how to avoid future crises.
In 2005, an estimated 2.4 million people were affected by severe food shortages, with more than 800,000 people facing critical food insecurity. Grain markets in Niger are somewhat integrated, with higher degrees of integration during drought years. Domestic grain markets are strongly integrated with regional markets, particularly those in Benin and Nigeria, with a higher relative degree of integration during the year of the food crisis. Key domestic and regional markets are useful for forecasting price changes in Niger. Lower levels of cereal production in these markets were associated with higher prices during the year of the food crisis.
Aker finds that local grain markets are highly responsive to national and sub-regional production and price shocks and suggests that local early-warning systems should monitor the spatial impact of drought and prices in key national and sub-regional markets. This essay highlights the need for policies that account for the impact of local purchases and regional trade on food security.