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‘Africa to expand rice production area by almost 50% to become global leader’


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Nigeria

IMAGE: Brandon Kliethermes, IHS senior economist »

October.10.2014

Between 2014 and 2031, Africa will expand its rice production area by almost 50 percent, according to new analysis on the global outlook on rice production and demand released Wednesday, by IHS Inc., a global source of critical information and insight.

Africa’s rapid expansion of areas for rice production will be the fastest globally, in percentage terms.

Across sub-Saharan Africa, the development of the agriculture sector is viewed by many countries as a way to: Diversify their economies away from excessive dependence on the mining sub-sector; increase employment prospects, and enhance poverty reduction.

“Cote d’Ivoire plans to spend $4 billion on agriculture development in order to improve crop yields and, in four years, become a rice exporter,” said Karanta Kalley, chief economist for Africa at IHS.

However, economic development, especially in West Africa, has a question mark hanging over it. “Right now, the question on everyone’s mind is what the impact of Ebola will be on the economic growth of sub-Saharan Africa,” Kalley said.

IHS expects real gross domestic product (GDP) growth to be curbed significantly for 2014 in Guinea, Sierra Leone and Liberia as a result of the ongoing Ebola outbreak.

The IHS real GDP growth rate forecasts have been cut between one-half and nine-tenths of previous forecasts, with Sierra Leone’s economy projected to have the highest rate of growth at 3.1 percent followed Guinea at 2 percent. IHS foresees only a marginal real economic growth rate of 0.8 percent for Liberia’s economy.

The spread of Ebola is still a concern for Nigeria, the region’s economic and population giant. “Public awareness and facilities in Lagos are better than in the Sierra Leone-Guinea-Liberia triangle, so the chances are fairly good that Nigeria can restrict its outbreak,” Kalley said.

“Although agriculture has dropped from 35 percent of the Nigerian economy to 22 percent due to the recent data criteria change, prospects for Nigeria’s real economic growth for the rest of 2014 are bright.”

World rice demand for 2014/15 is forecast to rise to 478 million metric tons, a 4.4-million-metric-ton increase from the previous year. For 2015/16, world rice demand is expected to increase by 4.5 million metric tons, to 483 million metric tons.

“Asian demand, mainly from China, is driving a majority of the growth in rice consumption during 2014/15,” said IHS senior economist Brandon Kliethermes. “However, Africa’s rice import demand is driving much of the world’s long-term import growth.”

World rice yields in 2014/15 are expected to soften year over year to 2.96 metric tons per hectare, but world production is projected to increase by a little over one million metric tons.

With a lower Indian rice production estimate due to issues relating to a later monsoon, India is forecast to lose its spot as top exporter in 2014/15.

“Thailand has regained its spot as top exporter, reaching 10 million metric tons, followed by India at 8.4 million metric tons, and then Vietnam at 6.6 million metric tons,” Kliethermes said. “With the military government in Thailand aggressively trying to find a solution to their large rice inventory, Thai rice exports are expected to increase.”

Longer term, Thailand and India will battle for the top exporter position, with both exporting more than 12 million metric tons per year.

Article Credit: Businessdayonline

Updated 4 Years ago
 

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Tags:     Africa     Rice Production     Cote d’Ivoire     Karanta Kalley     China     Brandon Kliethermes

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