Analysis of the demand for locally produced rice in Kumasi, Ghana

Thumbnail Image
May, 2016
Journal Title
Journal ISSN
Volume Title
In a country where rice has become the second most important cereal and staple food consumed by almost everyone, then issues pertaining to rice demand should become a matter of great concern especially when import, production and consumption statistics reveals the dominance of foreign rice demand over local rice. Surprisingly, this phenomenon has received less research attention in the Ghanaian context. The purpose of the study was to analyse the demand for locally produced rice in Ghana. Specifically, it sought to identify factors that affect the demand for local rice, determine the price and income elasticities of local rice and identify ways to improve on the demand for local rice. The design was a cross-sectional non-experimental study of 370 rice consumers (of which 120 were only local rice consumers, 100 local and foreign rice consumers and 150 non-local rice consumers) between the ages of 18 and 60 years who were sampled using the multistage cluster sampling technique according to sub metros and communities in the Kumasi Metropolis. A semi logarithm model was used to determine the factors (that is sex, age, household size, prices, income, taste, availability, foreign materials, cooking time, aroma and color) that influence the demand for local rice. The results of the study showed that household size, taste, presence of foreign materials, price and income significantly influenced the demand for local rice. The demand for local rice was fairly price inelastic as well as a normal good. Prominent among the factors cited by consumers and non-consumers to improve on the demand for locally produced rice included polishing, improved packaging, increased advertisement, availability and affordability. It is recommended that the findings of this study be utilized by governmental and non-governmental institutions such as the Ministry of Food and Agriculture to improve on the local rice industry in Ghana.
A Thesis Submitted to the Department of Economics, Kwame Nkrumah University of Science and Technology in partial fulfillment of the requirements for the degree of Master of Philosophy.