23 March 2014

Rwanda: Milk Exports Surpass Coffee

Milk emerged the main source of export revenues during the fourth quarter of 2013, surpassing coffee, the country's traditional major foreign exchange earner, for the first time.

Figures released by the National Institute of Statistics Rwanda on Friday show milk and milk products brought in $22.41 million (about Rwf15.5 billion), against $17.88 million brought in by coffee.

Export of minerals such as niobium, vanadium ores, tantalum and concentrates also performed well fetching $21.59 million during the same period.

Experts have attributed increased milk exports to the country's Girinka project and increased finances injected into the sector.

Burundi, DR Congo and Tanzania are the leading export destinations for Rwandan milk and milk products-consuming about 15,115 kg per year

Frank O'Brien, the Rwanda Dairy Competitiveness Programme chief of party, said a lot of progress had been made by the sector over the years; through implementation of government and donor-funded milk projects, including Land O'Lakes, a USAID-funded project.

There is a lot of progress being made towards improving dairy farming such as establishment of quality milk infrastructure like milk collection centers and cooling equipment. This has improved the quality of milk and made it more profitable in regional markets.

Andrew Kagabo, the Girinka programme national co-coordinator, said this year the project planned to distribute over 4,000 cows .

"This will further boost milk production and ultimately exports," Kagabo said

Figures from Rwanda Agriculture Board indicate that Rwanda's milk production has increased by 11 per cent over the past two years.

Revenue from coffee exports declined primarily because Rwanda's coffee season starts in March and gradually winds down towards the end of the year. However, coffee prices also fell last year to as low as $2 per kg of processed coffee due to a weak global demand and a glut in the world's leading coffee producer, Brazil.

However, officials at the National Agriculture Export Board are optimistic about a rebound in coffee prices due to a decline in Brazil's coffee supplies this year.

"Unlike last year when the industry did not perform well, we are predicting a good result this year with annual total production increasing to more than 25,000 tonnes," George William Kayonga, NAEB Director-General, told The New Times on the sidelines of a coffee research symposium in Kigali on Monday.

Trade deficit widens

Meanwhile, Rwanda's trade deficit has widened to $ 564.6 million during the last quarter of 2013 compared to $689.3 million during second quarter of the year. The country imported goods worth $415.5 million while exports fetched $121.5 million.

Figures show that the economy earned $27.6 million from re-exports to neighbouring countries-reflecting 9.77 per cent increase in imports in current price terms. The country's main re-exports during the fourth quarter of 2013 were petrol which fetched $6.25 million, gas oil $6.02 million and kerosene type jet fuel $5.50 million.

Imports from China were the highest in value registering $87.69 million followed by imports from Uganda which consumed $52.59 million and India $39.28 million.

Cement and mobile cell phones remained the two main imports during the period costing $17.68 million, and $14.53 million respectively.

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