According to agribusiness company, Finatrade, government's crack down on the importation of rice has contributed in surging demand for local rice as it outstrips supply.

Mr John Awuni, Corporate Affairs Director of Finatrade, distributors of a brand of locally produced rice ‘Pride Rice,’ said even though supply levels have not been re­duced, demand seems to outstrip supply.

He wants the Ministry of Trade to sustain the crack down on the numerous unfair trade practices, including evasion of import duties and other taxes, under­invoicing, infringement of trademarks, and smuggling.

Owing to the free fall of the cedi, coupled with a ban on inland importa­tion of rice,traders are said to be reporting a boost in the pa­tronage of locally produced rice.

Im­ported rice, which usually attracts about 40% import duties, has become more expensive as the cedi falls, compared to locally produced rice.

For example, 50kg foreign rice costs GHC 250 compared to GHC170 for the same quantity of local rice with compa­rable quality.

The price of 25kg of locally pro­duced rice is GHC70 as against GHC85 for the same quantity and quality of im­ported rice.

Market watchers say the absence of cheap smuggled rice, which is sold below market rates of both locally pro­duced rice and legally imported rice, is contributing significantly to the demand for local rice.

Market watchers believe that the de­velopment is a major incentive for local rice production and should motivate farmers to produce more.

The Trade Ministryon October 14, 2013 di­rected that all importation of rice into the country must be done through the airport or by sea.

The policy, according to the Trade Ministry, was “intended to provide a framework of administrative procedures through which the numerous unfair trade practices, including evasion of im­port duties and other taxes, under-in­voicing, infringement of trademarks and smuggling, shall be controlled."

Market watchers applauded the move because it believed that inland im­portation of rice through neighbouring countries involves numerous unfair trade practices, including evasion of im­port duties and other taxes, under-in­voicing, infringement of trademarks, and smuggling.

However, the Trade Ministry was pressurised to withdraw the restrictions last month.