Analysis of Seasonal Pattern and Variation of Rice Prices in Tanzania

Abstract

The objective of this paper was to study Tanzania’s rice sector, regarding the seasonal behavior of wholesale rice prices in the Mbeya Region. It’s considered that price is the most crucial variable in the farmer’s decision making. The classical multiplicative model was employed in the analysis of monthly time-series data from 2004 to 2018 to verify if there were changes in the seasonal variation pattern. The data were obtained from the Ministry of Industry, Trade, and Marketing in Tanzania. According to the results, rice prices seem to have followed a consistent and logical pattern around their annual average, in spite of increased uncertainty and variability in the overall Tanzania grains markets. The months of November to May were the best month for selling rice as the seasonal variation indexes were highest, above 100%; thus, farmers would gain more by storing rice during the harvest period for future sales. On the consumer side, the best month for purchasing rice was from June to October, which is harvest season. Knowledge of these rice price patterns and the risk levels of specific months can be useful to producers and purchasers as they develop their annual marketing plans.