Rice market in the Volta basin: The case between Burkina Faso and Ghana

1. Rice market in the Volta basin: The case between Burkina Faso and Ghana Bruno Barbier CIRAD (Glowa Volta project) Laurent Compaoré (EIER) Kadidia Loncili (EIER)

2. Uncertain world rice market Pressure on rice prices • Increasing demand for rice in Asia and Africa • Increasing demand for feed in Asia • Some large asian countries are ready to give up self sufficiency • Two small countries produce most of the surplus • India not interested in rice export • All want to diversify • Land and water are becoming scarce • Expensive energy requires new hydroelectric dam • Research in irrigation and rice production stagnant or decreased But • US likely to increase its share of production • EU likely to increase wheat exports to Africa Rice Policy - Warda Workshop Nov 2005

3. Rice demand in Burkina Faso • Typical of a landlocked country • Rice still secondary in the national consumption • Mostly urban consumption • Population still attached to local cereals • Shifting from sorghum and millet to rice and maize (marginaly to wheat) • The CFA devaluation of 1994 (From Savadogo) • Consummers reduced total food consumption • Rice share only decreased among the poor • Shares remainded similar • Perspective • Can local rice producers respond to incentives • Wheat will become a competitor • National demand likely to rise fast regardless of relative prices Rice Policy - Warda Workshop Nov 2005

4. Grain consumption in urban areas in Burkina Faso in 1997 Kgs/ month Average Source: Savadogo and Kazianga 1999 Rice Policy - Warda Workshop Nov 2005

5. Rice production in perspective in Burkina Faso • A small production with limited potential • Rice production is very small in regard to national grain production • Marginal environment for rainfed production • Perspectives • Increasing national demand • Increasing transport costs for imported rice • Regional integration • Good response from lowland production after the 1994 devaluation • Iimited potential from irrigaton and rainfed, better for lowland • Competition from cotton and maize Rice Policy - Warda Workshop Nov 2005

6. Rice production and imports in Burkina Faso Rice Policy - Warda Workshop Nov 2005

7. Irrigated areas in sahelian countries Source: Faostat Rice Policy - Warda Workshop Nov 2005

8. Irrigation development Rice Policy - Warda Workshop Nov 2005

9. Modèle économique Mata GLOWAVolta Volta basin Rice Policy - Warda Workshop Nov 2005

10. Rice Policy - Warda Workshop Nov 2005

11. Rice Policy - Warda Workshop Nov 2005

12. Rice irrigation ? • The critics • Irrigation area is very small • Expansion of irrigation very expensive (more than $15000/ha) • Sector still desorganised • Water will be used for consumption and hydropower • The pro arguments • Climate variability and change • High risk premium of rainfed production • Increasing gap between production and consumption • High yield potential Rice Policy - Warda Workshop Nov 2005

13. Policy options • Taxes • Import taxes: increase the TEC • Adjusted taxes • Careful about the EPA (EU) • Subsidies • Already large subsidies for irrigated schemes • Need of support on research, extension and training • Migrations • Towards less populated and more humid regions • Infrastructure and services in less populated regions • Promote mechanisation and herbicides in less populated regions Rice Policy - Warda Workshop Nov 2005

14. Current CIRAD participation in projects on related policies • Food security and regional integration (Cirad funding) • CGEs for Sénégal, Mali, Burkina and Ghana • Glowa Volta project (German funding) • Sector economic models in Burkina and Ghana • Linked to a volta basin an hydrologic framework • Seamless (Eu funding) • Sector model for Mali including « office du Niger »   • Lowland project (consortium bas-fonds) . Rice Policy - Warda Workshop Nov 2005

15. Thank you Rice Policy - Warda Workshop Nov 2005