6 February 2018

Tanzania's Rice Exports to Kenya, Rwanda to Increase

Photo: Pixabay
Gold nugget

Tanzania hopes to increase its rice exports to Kenya and Rwanda by one-third this year, according to forecast by a trade tracker.

According to the East Africa Cross-border Trade (EACT), the trade volume will be boosted by supplies from the August harvest and high carry-over stocks, which are likely to lower prices. The low rice prices are due to lower maize flour cost which is a substitute staple food to rice.

Amid trade disputes, Kenya is still Tanzania's main market for rice followed closely by Rwanda.

Tanzania projects to export 84,000 tonnes of the locally produced rice to Kenya and 60,000 tonnes to Rwanda.

Exports to Burundi will continue to be limited because of the depreciation of the country's franc and low purchasing power as the economic situation worsens because of the effects of the disputed 2015 presidential election.

The EACT projects that rice exports from Uganda to South Sudan will also continue to be minimal due to conflict-related trade disruptions, South Sudan's currency depreciation and low purchasing power due to subdued economic activity.

Re-exports of imported rice by Somalia to Kenya is expected to shoot up between April and September to coincide with the holy month of Ramadhan in May and the August Hajj celebrations.

In Kenya, rice prices have been increasing due to a decline in local production and expensive imports.

Most traded commodity

However, maize continued to be the most regionally traded commodity in the region. Toward the end of last year, maize prices in most markets in East Africa declined due to increased harvests.

In the months after the August harvest, maize prices usually drop to lows of $20 per 90kg bag, even as the October long rain season boosts the second-season harvest.

Bujumbura's maize prices remain persistently high, being the most costly in the region, whereas the grain was fetching the lowest cost in Ethiopia due to the low cost of production.

The low cost of maize sent Ethiopian traders to Kenya, selling more maize last year than the previous years. Maize is the most traded commodity across the region, followed by dry beans, rice and sorghum.

Uganda, Tanzania and Ethiopia are the main sources of maize, but in September last year Kenya sold the grain to Uganda even as the country was importing it from Mexico to plug a severe shortage. Maize prices had fallen after the end of a long dry spell.

Tanzania

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