John Thompson and Dawit Alemu (July 2019)

1. Importance of the rice sector in Ethiopia:
commercialisation, emerging challenges
and opportunities
John Thompson and Dawit Alemu
18 – 20 July 2019
17th International Conference on the Ethiopian Economy
Ethiopian Economics Association (EEA), Addis Ababa
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2. Introduction
• Introducing the APRA
Programme and livelihood
trajectories
• Rice as a strategic crop for
Africa
• Rice in Ethiopia
– Growing importance
– Trends in production,
imports, consumption, R&D
• Key Challenges
• Conclusions
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3. ‘Agricultural Policy Research for Africa’ (APRA)
• APRA: Analysing the differential
impacts of agricultural
commercialisation on local livelihoods
and rural economies
• Focus on ‘inclusive commercialisation’
in 8 countries, including Ethiopia
• Involves large network of partners in
the Future Agricultures Consortium
(100+ researchers)
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4. 1. ‘Stepping in’
2. ‘Stepping out’
3. ‘Stepping up’
4. ‘Hanging in’
5. ‘Dropping out’
Analysing 5 Livelihood Trajectories
through Agricultural Commercialisation
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5. 1. ‘Stepping in’
2. ‘Stepping out’
3. ‘Stepping up’
4. ‘Hanging in’
5. ‘Dropping out’
Analysing 5 Livelihood Trajectories
through Agricultural Commercialisation
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Focus of APRA
longitudinal
research on rice
commercialisation
pathways in the
Fogera Plain

6. Rice as a Strategic Crop
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7. Rice as a Strategic Crop in Africa
• African rice consumption is projected to reach 34.9
mil Mt of milled rice per year by 2025
• Some 12.6 mil Mt of this will be imported – at a cost
of roughly USD 5.5 billion annually
• Demand for rice is growing as a result of 3 main
factors:
1. population growth
2. increasing per capita consumption
3. shifting consumer preference from urbanisation
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8. Rice as a Strategic Crop in Africa
• Today, African rice production does not satisfy
demand, both in terms of quantity and quality
• If trends continue, African rice production by 2025
will meet just 64% of the continent’s demand
• The gap in demand will have to be met by imports
– mainly Asian rice – unless significant investments
are made in domestic production
• Transformation of the rice value chain will require
mobilising USD 21-26 bil over next decade
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9. Importance of rice in Ethiopia
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10. Rice in Ethiopia
• Rice is a recent introduction to Ethiopia – linked with
efforts to address development challenges during the
Derge regime (e.g. food security, settlement)
• Government has now designated 7 regions as
‘National Rice Hubs’ for Rice R&D
• The Fogera area is one of those Hubs and has
become a major rice producing zone with increasing
levels of commercialisation – focus of APRA research
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11. Importance and comparative advantage
The importance and comparative advantage of rice is associated
with the:
1. existence of suitable agro-ecologies for increased production
and the quest for addressing food insecurity and efficient
utilisation of available resources
2. compatibility of rice with local farming systems and traditional
foods, especially injera making
3. economic incentives of its production, related to higher
productivity in response to high unit price
4. favourable public policy environment and support of
development partners (Government, JICA/EthioRice, CARD,
AfricaRice, IRRI, etc)
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12. Trends in rice production, imports
and domestic consumption
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13. Trends in rice production, imports and
domestic consumption in Ethiopia
• Rice production increased by nearly 44% – 71,316 Mt
in 2008  126,806 Mt in 2016 (CSA data)
• But rice imports also increased by almost 14x over
the same period (22,500 Mt  311,827 Mt) – at a
cost of USD 12 mil in 2008 to USD 171 mil in 2016
• The extent of rice self-sufficiency decreased –
70% in 2008  30% in 2016
• This implies a significant increase in domestic
consumption of rice, with demand continuing to rise
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14. Trends in production, imports and self-
sufficiency in rice (2008 – 2016)
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
-
50.00
100.00
150.00
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250.00
300.00
350.00
400.00
450.00
500.00
2008 2009 2010 2011 2012 2013 2014 2015 2016
Selfsufficiency(%)
Volume(1000tones)
Year
Self sufficiency (%) Domestic production (1000 tone)
Import (1000 tone) Domestic consumption (1000 tones)
tonnes)
tonnes)tonnes)
tonnes)
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15. Trends in production, imports and self-
sufficiency in rice (2008 – 2016)
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
-
50.00
100.00
150.00
200.00
250.00
300.00
350.00
400.00
450.00
500.00
2008 2009 2010 2011 2012 2013 2014 2015 2016
Selfsufficiency(%)
Volume(1000tones)
Year
Self sufficiency (%) Domestic production (1000 tone)
Import (1000 tone) Domestic consumption (1000 tones)
tonnes)
tonnes)tonnes)
tonnes)
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How to fill this
growing gap?

16. Rice imports – a burden on foreign currency and
a systemic risk
• The import bills for rice reached close to 200 million USD
in 2016 and is projected to increase in future
• A substantial amount of the imported product is low-
grade broken rice from Asia
Type of rice product
Average proportion of total rice
product imported (%)
Milled Rice 70.88
Broken Rice 19.94
Husked (brown) rice 2.14
Total Paddy rice 6.91
Rice flour 0.14
Average proportion of imports – 2008-2016
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17. Trends in rice R&D efforts
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18. Trends in Rice Research & Development
• 2007 – Rice is declared a ‘Millennium Crop’
• 2008 – Ethiopia joins CARD – the Coalition for African Rice
Development (CARD)
• 2010 – The National Rice R&D Strategy is developed by the
Government, with the support the Japanese International
Cooperation Agency (JICA) and SG-2000
• 2010 – National Rice Steering and Technical Committees are
established to guide implementation of the Strategy
• 2015 – EthioRice begins – EIAR-JICA cooperation project
• 2016 – Ethiopia joins AfricaRice (Africa Rice Center ) – a pan-
African intergovernmental association of 27 member states
• 2017 – EIAR implements new Rice Research Strategy
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19. Intensifying Rice R&D
• 35 improved rice varieties
have been released for
three rice ecosystems (15
for rain-fed uplands, 11 for
rain-fed lowlands and 9 for
irrigated lands) (EIAR 2018)
• The National Rice Research
and Training Center was
established in Fogera in
2013 and formally
inaugurated in 2018
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20. Key challenges facing the rice sector
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21. Some key challenges facing the rice sector
• Rice production and productivity remains low – national
average is only 2.84 Mt/ha (CSA 2018)
• Huge competition of imported rice with domestic rice –
hard to compete on quality
• Shortage of pre-harvest mechanisation and post-harvest
processing technologies – milling, storage, transport, etc.
• Inadequate market development to link to both domestic
and international value chains
• Lack of skilled human resources and training resources in
all aspects of the rice R&D
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22. Conclusions
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23. Conclusions
• Ethiopia is endowed with huge potential for rice
production – both rain-fed and irrigated
• But demand for rice is growing rapidly and
outstripping domestic supply
• Farmers are able to respond to these market
opportunities – i.e. to ‘step up’ and ‘step out’ – with
the right investments and technical support
• Thus, Ethiopia will have to continue to rely on
imported rice to fill the ‘gap’ for the near future
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24. Conclusions
• There is an urgent need to strengthen R&D capacity to
transform the rice value chain – improving productivity,
access to finance and inputs, and processing to produce
quality rice in greater quantities
• Building partnerships with other rice producing countries
Africa and Asia – South-South exchanges – and key
international organisations can accelerate this process
• The pursuit of rice self-sufficiency should be seen as part
of a larger goal of achieving food and nutrition security
through a diversified and integrated food and agricultural
strategy
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25. Thank you for your attention
John Thompson Dawit Alemu
j.thompson@ids.ac.uk dawit96@gmail.com
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