At present, about 12.4 million people are food insecure in Ethiopia. Moreover, the pastoralist and marginal agricultural areas of eastern and south-eastern Ethiopia are extremely food insecure because of conflict, successive years of below average rainfall, and low agricultural production from the 2008 meher harvest (FEWS NET 2009). The hunger situation in the country is “Extremely Alarming” and has a significantly high value of 30.97 on the 2008 Global Hunger Index, which comprises of three measures of hunger – population undernourishment, child malnutrition, and child mortality.

Food prices in 2008 were high despite a good harvest and adequate cereal availability relative to utilization. Food inflation accounted for 56 percent of the total inflation, which was as high as 40 percent. However, high global food prices are not the main factor contributing to food inflation in Ethiopia. The primary causes for high food prices in Ethiopia are market distortions, increased demand for food from urban population, and overall economic growth. Climatic factors such as poor rains and trans-border animal diseases in pastoral areas have also contributed to worsening food security in these areas (WFP 2008).

As a response to the high food prices, the Government has resumed the availability of subsidized food commodities in urban areas. Major cereal exports have been banned. Several productive safety net programs and nutrition interventions have been introduced (WFP 2008, FAO GIEWS 2009). The food-for-work productive safety net program has provided assistance to 7.5 million food insecure people in 2009 (FEWS NET 2009).