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Crop and Food Security Update - Summer Crop Nepal 2009/2010

Late start of the monsoon season and irregular distribution of rain caused a reduction in the
2009/2010 summer crop production across the country. Paddy production was down to
4.02 million MT and maize was 1.86 million MT. A reduction of 11 percent and 4 percent
respectively compared to last year’s yield (2008/2009).

It is anticipated that the country will face a severe food deficit during the FY 2009/2010
despite the positive outlook of the ongoing winter crop season. In August 2009, the MoAC
estimated edible cereal deficit of 400,000 MT for the FY 2009/2010 against the total
requirement of 5.4 million MT. This deficit represented the cereal requirement of seven
percent of the population. The deficit figure will be revised after the winter harvest.

The global food market situation is currently not favourable for Nepal. Natural disasters
caused substantial regional summer crop losses in countries such as India and the
Philippines, which resulted in a recent increase in the international price of rice. Domestic
food prices are stable at a higher-level but they are anticipated to increase further during
2010. In January 2010, the year-on-year food price inflation was 17.8%.

The Mid- and the Far-Western Hill and Mountain districts were severely affected by the poor
summer crop production. In those districts, some VDCs experienced a summer crop loss of
up to 50-70%, resulting in food insecurity among vulnerable population. Those districts are
traditionally food deficit and farmers are typically subsistent farmers with very limited
alternative livelihood options due to its remoteness.

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