1. RICE PRODUCTION IN GHANA: PAST, PRESENT AND FUTURE. DRIVING FORCES AND REQUIRED ACTIONS BOANSI DAVID

2. BACKGROUND RICE, FOOD FOR THE PEOPLE RICE, SOURCE OF LIVELIHOOD THROUGH PRODUCTION & MARKETING RICE AS A POLITICAL CROP IN GHANA AND MOST WEST AFRICAN COUNTRIES

3. MOTIVATION/PROBLEM STATEMENT  CHANGING CONSUMER PREFERENCES: INCREASING CONSUMPTION  PRODUCTION LESS THAN 40% OF DEMAND AND NATIONAL SUPPLY (Olaf and Emmanuel, 2009; Lançon and Hélène, 2007)  INFLUX OF IMPORTED RICE, HIGH PRICES OF IMPORTED AGRICULTURAL INPUTS ⇒ NEGATIVE RETURNS ⇒ 66% OF RICE PRODUCERS (FAO, 2006)  DRIFT FROM RICE PRODUCTION; LIMITED REPLACEMENT FOR AGING FARMERS ⇒ EXPOSURE OF GHANA TO SHOCKS ON WORLD MARKET IRREGULAR SUPPLY OF LOCAL RICE LOW QUALITY

4. OBJECTIVE TO IDENTIFY AND MEASURE THE MAGNITUDE OF EFFECT OF THE KEY ECONOMIC DETERMINANTS OF LOCAL RICE PRODUCTION IN GHANA  PERFORMANCE IN MEETING SUPPLY AND DEMAND  ASSESS DEVELOPMENTS IN PADDY PRODUCTION, HARVESTED AREA AND YIELD  ESTIMATION OF LONG-RUN RELATIONSHIPS (COINTEGRATING REGRESSION –FMOLS)  ESTIMATION OF SHORT-RUN EFFECTS (ERROR CORRECTION MODEL)

5. RICE PRODUCTION AND SUPPLY IN GHANA, 1961-2012

6. RICE SELF-SUFFICIENCY FOR GHANA, 1961-2009

7. DEVELOPMENTS IN RICE PRODUCTION : TRENDS RICE PLANNING TRENDS

8. RICE PLANNING

9. Output =AREA * YIELD

10. RICE MARKET STRUCTURE

12. DATA AND METHODS ⇒ METHODOLOGY VARIABLES: DEPENDENT VARIABLE INDEPENDENT VARIABLES *TOTAL PADDY OUTPUT *HARVESTED RICE AREA *YIELD *REAL PRODUCER PRICE OF RICE *REAL PRODUCER PRICE OF MAIZE * WORLD PRICE OF UREA FERTILIZER (P) *IRRIGATED AGRICULTURAL AREA (P) *AGRICULTURAL LABOUR FORCE (P)

13. HYPOTHESIS Log TPO t =β 0 + β 1 Log HA t-1 + β 2 LogY t-1 + β 3 Log RPPR t- 1 + β 4 Log RPPM t- 1 + β 5 Log PUF t + β 6 LogIRA t + β 7 Log AL t + µ t Hypothesis: β 1, β 2, β 3, β 6, β 7 > 0; β4, β 5 <0; ESTIMATOR : FULLY MODIFIED ORDINARY LEAST SQUARES * COINTEGRATING REGRESSION: LONG-RUN EFFECTS * ERROR CORRECTION MODEL: SHORT-RUN EFFECTS AND S.O.A.O.S MODELS

14. DATA PREPARATION GROUP TEST FOR NORMALITY LTPOLHALYLRPPRLRPPMLPUFLIRALAL Mean4.92054.54260.37845.81215.44215.04663.24878.2681 Median5.04014.60010.50985.88985.38205.02033.40128.2234 Max.6.19855.19301.00436.40886.35576.20003.52648.7119 Min.3.58353.6889-0.52764.99724.79204.18972.70817.9128 Std.Dev.0.66780.31990.43230.35270.34710.41270.22610.2506 Skewness-0.1271-0.4594-0.3763-0.41750.75330.4758-0.69610.2684 Kurtosis1.97103.08171.70682.36633.71273.33452.05381.6741 Jarque-B.1.77881.34743.54471.73964.39781.61094.48663.2400 Prob.0.41090.50980.16990.41900.11090.44690.10610.1979 Sum186.9790172.615714.3799220.8587206.8011191.7690123.4488314.1878 Sum.Sq.D16.50283.78566.91544.60344.45806.30291.89122.3238 Obs38

15. UNIT ROOT TEST AT LEVEL Series ADF test stat. Mackinnon Critical Values 1% 5% 10% Lag-Length (based on SIC, maxlag=9) Prob.Conclusion LTPO-0.1838-3.6329 -2.9484 -2.612920.9315Non-stationary LHA-0.0280-3.6537 -2.9571 -2.957150.9489Non-stationary LY-0.2837-3.6329 -2.9484 -2.612920.9174Non-stationary LRPPR-3.2941-3.6210 -2.9434 -2.610300.0224Stationary LRPPM-4.0009-3.6210 -2.9434 -2.610300.0037Stationary LPUF-2.7164-3.6210 -2.9434 -2.610300.0809Non-stationary LIRA-2.6378-3.6210 -2.9434 -2.610300.0947Non-stationary LAL-2.105091-4.2350 -3.5403 -3.202410.5257Non-stationary

16. UNIT ROOT TEST AT FIRST DIFFERENCE Series ADF test stat. Mackinnon Critical Values 1% 5% 10% Lag-Length (based on SIC, maxlag=9) Prob.Conclusion LTPO-7.1183-3.6329 -2.9484 -2.612910.0000I(1) LHA-6.6813-3.6329 -2.9484 -2.612910.0000I(1) LY-8.4294-3.6329 -2.9484 -2.612910.0000I(1) LPUF-7.5858-3.6268 -2.9458 -2.611500.0000I(1) LIRA-7.6088-3.6268 -2.9458 -2.611500.0000I(1) LAL-5.8223-3.6268 -2.9458 -2.611500.0000I(1)

17. MODELS AND RESULTS MODEL 1 COINTEGRATING REGRESSION Log TPO t =β 0 + β 1 Log HA t-1 + β 2 LogY t-1 + β 3 Log PUF t + β 4 LogIRA t + β 5 Log AL t + µ t Hypothesis: β1, β2, β4, β5 > 0 : β3 < 0 RESULTS VariableCoefficientStd. Errort-StatisticProb. LHA (-1)0.1019920.1445330.7056680.4858 LY (-1)0.4511160.1686572.6747580.0120 LPUF-0.0213790.089340-0.2393010.8125 LIRA0.2498200.3521110.7094920.4835 LAL1.4613260.3717153.9313080.0005 C-8.4728462.232593-3.7950690.0007 R-squared 0.839266 Durbin-Watson stat 1.925412 Adjusted R-squared 0.812477 Long-run variance 0.036138 S.E. of regression 0.290031

18. TEST FOR COINTEGRATION AND NORMALITY OF RESIDUAL Cointegrated Test- Phillips-Ouliaris ; H 0 : Series are not cointegrated Phillips-Ouliaris tau-statistic -5.690282 Prob* 0.0190 Phillips-Ouliaris z-statistic -31.30937 0.0445 Cointegration Test- Park Added Variables (L. trend) ; H 0 : Series are cointegrated Chi-square value 1.320867 df(1) Prob. 0.2504 ADF Unit Root Test on Residual ; Residual has a unit root ADF test statistic -5.081128 Prob. 0.0002 Jarque-Bera 0.923407 Prob. 0.630209

19. MODEL 2 ERROR CORRECTION MODEL

21. REFERENCES Olaf, K. and Emmanuel, D. (2009). Global Food Security Response: Ghana Rice Study. Attachment I to the Global Food Security Response West African Rice Value Chain Analysis. microREPORT#156, USAID Lan Ç on, F. and Hélène, D.B. (2007). Rice imports in West Africa: trade regimes and food policy formulation. Poster prepared for presentation at the 106 th Seminar of the EAAE. Pro- poor development in low income countries. Food, agriculture, trade and environment. 25-27 October 2007-Montpellier France FAO (2006). Briefs on Import Surges –Countries. No. 5, Ghana: rice, poultry and tomato paste. November 2006. Commodities and Trade Division, Food and Agriculture Organization of the United Nations, Rome, Italy. ftp://ftp.fao.org/docrep/fao/009/ah628e/ah628e00.pdfftp://ftp.fao.org/docrep/fao/009/ah628e/ah628e00.pdf