The price of husked and paddy rice in Madagascar is experiencing significant fluctuations in 2024. Although rice is a staple food, the country imports large quantities. Here is an overview of the variations observed in the first three quarters, influenced by economic and seasonal factors.
Price trends over the first three quarters
Paddy prices : Broad decline in Q2
In the second quarter of 2023, a substantial decrease in prices was recorded for all varieties of paddy rice in Madagascar. Sebota, in particular, saw its price drop from 1,750 MGA or 0.38 USD per kg to 1,583 MGA or 0.33 USD. Other varieties, such as tsipala and gasy, also followed this downward trend, while makalioka remained stable at 1,800 MGA per kg.
This widespread decrease likely stems from seasonal factors related to harvest and supply, as collection periods generally bring about a temporary abundance of supply, causing local market prices to fall. These seasonal fluctuations significantly influence price variations, especially in Madagascar’s agricultural regions, where harvests and weather conditions shift supply dynamics.
Partial price recovery in Q3
The third quarter saw a partial reversal for most paddy rice varieties, breaking the earlier trend of falling prices. The price of sebota rose to 1,683 MGA per kg, marking a 6.32 % increase from the previous quarter. Similarly, gasy paddy experienced a slight increase, going from 1,660 MGA to 1,725 MGA per kg.
Rice market : Factors influencing prices
Over recent years, rice prices in Madagascar have shown an upward trend. Beyond seasonal factors, this increase is driven by rising production costs, climate disruptions, and international market fluctuations.
Cultivation and weather conditions
Rice price fluctuations are often seasonal. During the harvest season, typically between April and June, prices tend to drop due to an abundant supply. In subsequent months, as stocks dwindle, prices can rise. Agricultural methods and specific regional growing conditions also greatly influence these price shifts.
The rising costs of inputs, such as fertilizers and seeds, can also drive prices up. Climate challenges directly impact local rice production, with events like cyclones and droughts disrupting output and causing unexpected price spikes.
Growing demand and consumption preferences
Rice consumption is rising alongside Madagascar’s population growth, especially in urban areas. Price variations also reflect local demand and consumer preferences. Each rice variety has unique taste and texture characteristics that greatly influence consumer choice and market price volatility.
Government policies and interventions
Government aid or import restrictions significantly impact the rice market. For instance, a June 2023 agreement between Madagascar’s « State Procurement of Madagascar » (SPM) and the Indian company « Vi Farm Organics Limited » for the import of 200,000 tons of rice did not materialize.
India, a major rice supplier to Madagascar, imposed export restrictions, creating immediate impacts on the local market. However, a partial lift of this ban was granted in December of the same year for five African countries, including Madagascar, enabling the country to maintain a stable supply level despite international market pressures.
Madagascar : Growing rice production
Madagascar ranks as the third-largest rice producer in Africa, following Nigeria and Egypt. Rice production for the 2023-2024 season reached 5.8 million tons, marking a 10 % increase. This progress enhances the availability of milled rice in the market, reducing reliance on imports and bolstering food security.
Local producers’ efforts to modernize agricultural techniques have played a key role in this growth. Innovative methods like parcel division and crop rotation are helping to optimize productivity.
The introduction of new hybrid varieties, more resilient to extreme climate conditions, is also supporting this positive trend. Recently, a partnership between Madagascar and a Japanese research institute led to the development of a drought-resistant rice variety, which will be distributed to farmers for the next agricultural season.
Decline in rice imports
According to the Rice Observatory, imports fell by 72 % between January 2023 and January 2024, dropping from 71,000 tons to 19,500 tons. This decrease reflects the success of initiatives aimed at boosting local production and reducing the country’s dependence on imports. Increased national production not only ensures better availability of local rice but also contributes to price stability in the domestic market.
Despite these advances, Madagascar remains partly dependent on imports, as local production still does not meet national demand. This gap is mainly due to the limited yield of the rice sector and the population’s growing needs. Low-income households continue to favor imported rice, which is more affordable and accessible.
