MADAGASCAR: Rice production slips again

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JOHANNESBURG, 9 September 2011 (IRIN) - Production of Madagascar�s staple, rice, is expected to be down 10 percent on last year and slip by 400,000 tons, according to preliminary findings by the Food and Agriculture Organization (FAO) and the World Food Programme (WFP). David Orr, WFP spokesperson for East and Southern Africa, told IRIN local rice production had decreased from 4.7 million tons in 2010 to 4.3 million tons this year. �This decrease is mainly due to delayed rainfall in the country's main rice producing areas, namely the Alaotra [east-central] and the Vakinankaratra [Highlands] regions,� he said. In the 1970s Madagascar was a rice exporter but has since become a rice importer, a consequence of outdated farming methods and poor infrastructure, but farmers still produce 80 percent of the country�s national rice requirement. The squeeze on rice comes during the lean season, between January and March, and in the first quarter of 2011 the staple threatened to become �luxury food� after its price doubled in two years to about US${esc.dollar}1 per kg. About 70 percent of the country�s 20 million people live on US${esc.dollar}1 a day or less and up to 45 percent of a family�s income goes on food, Alexandre Huynh, FAO emergency and rehabilitation coordinator in Madagascar, told IRIN. Hundreds of thousands of families have been exposed to chronic food insecurity in recent years through the increasing cost of food, he added. He said one of world�s poorest countries was susceptible to natural disasters �and recurrent climate-related shocks have weakened the resilience of small-scale farmers in cyclone and drought-prone areas, making them more reliant on emergency assistance.� However, field and pilot projects had illustrated �solutions were readily available to enhance food security� [but] would need to be scaled up to have an impact at the national level,� Huynh said. �Numerous households in the main cities and particularly [the capital] Antananarivo largely depend on farming to make it through the current difficult economic context and do require external support,� he said. In the first quarter of 2011 President Andry Rajoelina�s government, which has been ostracized by the international community after coming to power in March 2009 with the backing of the military, waived duty and taxes on rice imports to suppress prices until the end of the lean season. WFP�s Orr said a worsening food security situation was expected during the upcoming lean season. Cash-strapped Since April 2011, international rice prices have been rising. This makes it more expensive for the cash-strapped government to dampen the price of the staple during the lean season. Hundreds of millions of dollars of donor assistance have been frozen in recent years in response to Rajoelina�s �illegal� transfer of power from former president Marc Ravalomanana. John Uniack Davis, country director for Care International, told IRIN: �Since the harvest period around April [2011], rice prices steadily rose to about 1,400 ariary [70 US cents] a kilogramme up to last month [August], but they seem to be levelling off or dropping slightly as farmers in zones with two annual harvests, such as Ambatondrazaka [the district east of Antananarivo] on Lac Alaotra, begin bringing more rice to market.� The sale of state-subsidized rice through the 'tsena mora� programme, where the staple was sold at reduced prices in shops in poor urban neighbourhoods, was also recently suspended, Davis said. L'Observatoire du Riz, a state-funded organization which monitors the price of rice, said in its August 2011 newsletter: �This year�s rice market is marked by higher prices compared to the previous year.� The organization estimated that rice so far this year had gone up by 100-200 ariary (5-10 US cents) per kg. The FAO Cereal Price Index released on 8 September 2011noted that the rice index rose 4 percent in August, and was 36 percent higher than in August 2010. The increase was attributed by FAO to the world�s largest exporter of rice, Thailand, and its decision �to increase the purchasing price from farmers to above market levels�. Blame it on Thailand Concepci�n Calpe, a senior economist at FAO�s Intergovernmental Group on Rice, said: �Madagascar is facing food inflation and even rice prices appear on an upward trend, although this seems rather related to prospects for only average production this year� �The high producer price policy conducted in Thailand is impacting negatively on all major importing countries, especially as such policy is pushing up the prices of other exporters too, in particular Viet Nam,� she said. �The rise [in the price of rice] is mainly policy related, even though the tightness that is prevailing in other cereal markets also contributes,� Calpe said. �Unless Thailand drops its current policy stance, world prices are likely to remain high.� The International Rice Research Institute (IRRI) said in its July-September 2011 Rice Today briefing entitled The Search for Direction: [ http://irri.org/knowledge/publications/rice-today/rice-facts/the-search-for-direction ] �The FAO food price index in recent months [and prior to Thailand�s decision] has exceeded the level it reached in 2008, but the number of hungry people is estimated to have risen by only 44 million compared with 100 million during the 2008 food crisis. �Interestingly, the lower rice prices have kept a lid on the rise in the number of hungry people during the current food price spike - a shining example of the importance of keeping rice prices affordable for the one billion hungry people in the world,� the briefing said. go/cb � IRIN. 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