ANALYSIS OF RICE PRODUCTION AND OPPORTUNITIES IN GHANA

1. ANALYSIS OF RICE PRODUCTION AND OPPORTUNITIES IN GHANA By Makafui I. Dzudzor Masters in Agricultural Food and Environmental Policy Analysis (AFEPA)

2. TABLE OF CONTENT • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References • Background • Problem statement • Research question • Research objectives • Results • Conclusions • References

3. BACKGROUND • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Ghana • Population :24,658,823 • GDP:US$40.71billion • Services: 50% • Industry: 27.3% • Agriculture: 22.7% • Agriculture • Land: 13,628,179 ha (55% under cultivation) • Small farm sizes (average of about 2ha) • Crops- cocoa, oil palm, cassava, yam, maize, rice, pineapple, citrus, banana, mangoes, pepper, tomatoes, etc

4. BACKGROUND • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Definition of terms • The type of rice (Childs and Burdett, 2000) can be classified based on various characteristics. • Form : • Rough or paddy rice (both hull and bran layers attached to kernel) • Brown rice (bran layers) • Milled rice (no hull and bran layers) • Ecogeographical regions: • Indica rice (tropics and sub tropics) • Japonica rice (temperate climates ) • Aroma: • Aromatic (fragrant) rice (Thai jasmine and basmati from India and Pakistan) • Non aromatic (non fragrant) rice.

5. BACKGROUND • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Rice Sub-Sector in Ghana • Rice has become one of the major staple cereals in Ghana. It is the second largest cereal consumed after maize. This has been attributed to increasing urbanization and the ease with which it is prepared. • About 70 percent of total rice consumed in Ghana is in urban areas, mainly Accra and Kumasi (SRID-MoFA, 2010). • In 2011, the per capita consumption of rice was 24 kg per annum (SRID-MoFA, 2012). • The Government of Ghana predicts the continuous increase in consumption levels due to rapid population growth and urbanization (GNRDS-MoFA, 2009). • Rice imports attract 37 percent in taxes and levies (import tax-20%)

6. PROBLEM STATEMENT • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References • Over the past decade and a half, Ghana’s rice sector has attracted the attention of stakeholders and policy makers largely due to the increase in consumption and the effect of its rising import bill on the economy. • Ghana has the right agronomic conditions to produce rice throughout the year(Assuming-Brempong,1998). • However, structural constraints namely, poor agronomic practices, low usage of agrochemicals, lack of homogenous seeds of demanded varieties and low farm mechanisation have resulted in a lot of inefficiencies in the rice sub-sector. • These inefficiencies have stifled the rice production opportunities that the right agronomic conditions offers. • The inefficiencies, low yields coupled with high consumption has resulted in Ghana been a net importer of rice.

7. PROBLEM STATEMENT • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References • Over the period 2000 to 2011, imported rice increased from 187,256MT to 543,465MT representing about 190 percent increase in imports. Over the same period, the import bill increased from US$65.03 million to US$391.17 million. • Also smallholder farmers have to compete with these imported varieties. • Consumers pay cheaper prices in terms of the quality of imported rice as against the domestically produced one and also they have more varieties to choose from. • Therefore, the government has initiated a number of policies(FASDEP I, II, METASIP, etc) and established the Ghana Rice Inter-professional Body(GRIB) that promotes the best domestic aromatic varieties to be grown by farmers. Eg Marshall, Jasmine 85, Aromatic short (Diako et al, 2010)

8. RESEARCH QUESTION • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References • Primary research question What opportunities do the current state of Ghana's rice sub-sector offer compared with rice imports • Specific research questions • How has Ghana's rice sub-sector responded to consumer’s growing demand for quality and aromatic rice varieties • What are the characteristics of the rice distribution network in Ghana? • What is the effect of government agricultural and trade policy on the rice sub-sector in Ghana?

9. RESEARCH OBJECTIVES • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References • Primary research objective To analyse the state of Ghana's rice sub-sector and identify the opportunities in this sub-sector • Specific research objectives • Analyse Ghana's rice sub-sector through a trend analysis of production levels, acreage under cultivation, yield and rice import penetration ratio from 2000 to 2011 • Analyse the rice distribution network • Simulate the effect of different agricultural and trade policy scenarios on the quantities produced, consumed and prices of domestic and imported rice.

10. Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Data description • The data used in the study was sourced from the Ministry of Food and Agriculture-Ghana. • The data covered production, acreage cultivated, yield and prices of rice and maize from 2000 to 2011. • The data was not disaggregated on the bases of whether aromatic or non aromatic and therefore more computations were under taking to make the data appropriate for my study.

11. RESULTS • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 1: rice production, yield and acreage In 2007, poor rainfall resulted in less land going under cultivation and this led to low yields. After 2007, the growth recorded can be attributable to more investment in the sector and the implementation of GNRDS In 2011, governments reduced its discretionary budget allocation to agric by 30%. Therefore it affected the investment activities in the sector including the rice subsector.

12. RESULTS • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 1: rice imports According to MoFA, the high figure recorded in 2003 may have been trans-shipment to neighbouring countries. This was the period when Cote d’Ivoire was fighting a civil war. Therefore, most landlocked country routed their imports through Ghana. The peak of 2007, was due to poor rainfall so production levels that year were extra low so that resulted in higher imports

13. RESULTS • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 1 : rice import penetration ratio Ghana still depends heavily on imported rice. This is despite all government interventions over the years. In 2011, the import penetration ratio was about 64 percent. The generally high import penetration ratio is due to the fact that about 40 percent of paddy production is lost in the process of converting it into milled rice.

14. RESULTS • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 2:Rice distribution network in Ghana • There are 2 main rice distribution networks in Ghana • Local rice channel • Input suppliers • Producers • Local rice processors/aggregators • Rice wholesalers • Rural and Urban retailers • Rural and Urban consumers • Imported rice channel • Rice importers • Imported rice and Rice wholesalers • Rural and Urban retailers • Rural and Urban consumers

15. RESULTS • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 2:Rice distribution network in Ghana

16. Methodology • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 3: simulation analysis • The model developed in this objective is based on the Armington trade model. • Assumptions of the model • Rice is differentiated based on the country of origin • Rice is also differentiated based on variety(aromatic and non aromatic) • There is no rice export • There is import tax and other taxes levied on imported rice • There is self sufficiency in maize production(no import or export) • Farmland is either used for maize or rice cultivation • Consumers choice of cereal is between rice and maize • Producer price of maize equals consumer price of maize

17. A schema of the Armington based partial equilibrium model Maro, Paro Caro, Paro CSaro, PParo CSR, PCR CSR, PPR CSnaro, PPnaro Rmix Cmix, PCmix Cnaro, Pnaro Mnaro, Pnaro CSM, PPM CM, PCM

18. Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 3: Equations of the model

19. Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 3: Equations of the model

20. Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 3: Equations of the model

21. Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References Objective 3: simulation scenario • Apply agricultural and trade shocks to the model through • An increase or decrease in taxes • An increase or decrease in land cultivated • An increase or decrease in the international price of rice • The simulated results will be compared with the current state of the rice sub-sector and percentage changes will be calculated for production, consumption and prices of rice and its varieties and maize

22. CONCLUSION • Background • Problem Statement • Research question • Research objectives • Results • Conclusions • References • The import penetration ratio shows that Ghana still depends heavily on imported rice despite all the interventions by government • More market access should be created for farmers in order to reduce the influence of wholesalers ‘market women’. • Conclusion from the model (work in progress)

23. REFERENCES • Background • Problem Statement • Research question • Research objectives • Methodology • Limitation of study • Conclusions • References • Amanor‐Boadu Vincent (2012), “Rice Price Trends in Ghana (2006‐2011) Monitoring Evaluation and Technical Support Services (METSS)”, Ghana Research and Issue Paper Series No. 02‐2012 ‐ June 2012 • Asuming-Brempong S. and Osei-Asare Y., (2007), “Has Imported Rice Crowded-Out Domestic Rice Production in Ghana? What Has Been The Role Of Policy?”, AAAE Conference Proceedings, pg.91-97 • Fintrac (2012), “The Enabling Agricultural Trade (EAT) project - The Market for Maize, Rice, Soy, and Warehousing in Northern Ghana”, United States Agency for International Development (USAID) • Ministry of Food and Agriculture (MoFA) (2007), “Food and Agriculture Sector Development Policy (FASDEP II),” Accra-Ghana • Ministry of Food and Agriculture, Accra-Ghana, http://mofa.gov.gh/site/#, 13th February, 2013 • Ministry of Food and Agriculture (MoFA) (2012), “Facts and Figures 2011”, Accra-Ghana • Ministry of Food and Agriculture (MoFA) (2011), “Facts and Figures 2010”, Accra-Ghana • Ministry of Food and Agriculture (MoFA) (2010), “Facts and Figures 2009”, Accra-Ghana • Ministry of Food and Agriculture (MoFA) (2012), Statistics, Research, and Information Directorate (SRID), Accra- Ghana • Ministry of Food and Agriculture (MoFA) (2010), Statistics, Research, and Information Directorate (SRID), Accra- Ghana • Ministry of Food and Agriculture (MOFA) (2010), “Medium Term Agriculture Sector Investment Plan”, Accra Ghana • Ministry of Food and Agriculture (MoFA) 2009 “Ghana National Rice Development Strategy”, Accra, Ghana: http://www.jica.go.jp/english/our_work/thematic_issues/agricultural/pdf/ghana_en.pdf, 13th February, 2013

24. Thank you