Africa favourable year for crops

SUFFICIENT amount of rainfall points to better harvests for the current crop season up to 2013 in the region, whose agricultural output is largely weather-dependent.¹ Better weather conditions in most parts of Africa should ease the pressure on prices of food and other agricultural outputs, translating to higher demand from both export and domestic markets.

Over the past two decades, Africa has lost ground in the global marketplace for its agricultural exports. Despite modest gains in the 1990s, the region’s share of total world agricultural exports have fallen from about 6% in the 1970s to 3% today. ²

With the exception of cotton, African producers of traditional agricultural commodities have steadily been losing market share to Asian and Latin American competitors over the last two decades.³

The International Food Policy Research Institute (IFPRI) noted that African countries are still heavily dependent on traditional export crops such as cocoa, coffee, cotton, sugar, tea, and tobacco, which combined, account for 50% of Africa’s total agricultural exports. But because of the declining prices in the world market, the increased production of traditional export crops has not translated into much growth in farm incomes.

The challenge posed by weak world demand is compounded by competition from many exporters in Asia and Latin America, which have improved product differentiation and quality, features that rich importing countries increasingly demand.

The most encouraging prospects for boosting income from traditional exports lie in exploiting opportunities for product differentiation such as by the type of branding that has popularised specialty coffees. Many countries could also secure higher prices by raising the average quality of the products they export, establishing grading systems, and segregating different qualities for export.⁴

IFPRI said the general forecast is more upbeat in the non-traditional export sector, where market opportunities offer prospects for significant growth.

Newer, niche markets such as fresh vegetables, cut flowers, and fish may haveUltra Boost Uncaged