Reference Date: 23-December-2022

Paddy production anticipated at below‑average level in 2022 on account of low plantings

Harvesting of the 2022 main season paddy crop is ongoing and production is forecast at a below‑average level. This mainly reflects a contraction in plantings, as farmers were discouraged to sow, following the government’s decision to eliminate the reference prices on rice in retail and wholesale markets. According to the National Rice Corporation (CONARROZ), the planted area with the main season paddy crop was 14 553 hectares, nearly 40 percent lower year‑on‑year as well as the five‑year average. Weather conditions have been generally favourable, supporting the development of crops, which are mostly rainfed.

The 2022 minor season paddy crop, to be harvested in April and May 2023, is being planted in the provinces of Guanacaste and Alajuela, where seasonal production is concentrated. The area sown is forecast to remain at a below‑average level, amid the lack of guaranteed reference prices and the high costs of agricultural inputs. Rainfall amounts are forecast at average levels during the first quarter of 2023, securing irrigation water supplies. This is expected to have a positive impact on yields of predominantly irrigated crops.

Cereal import requirements forecast slightly above average in 2022/23 marketing year

Cereal import requirements in the 2022/23 marketing year (July/June) are forecast at 1.3 million tonnes, slightly above the five‑year average level, mainly due to rising demand for yellow maize by the domestic feed sector. Requirements are similar to year-earlier levels, reflecting the availability of some carryover stocks of grains imported in the 2021/22 marketing year. Imports of wheat grain and flour are also forecast at high levels, reflecting the sustained demand for human consumption in line with increasing population.

Rice prices stable between June and November 2022

Retail prices of rice have been stable since June 2022, despite the removal of reference prices in August. This was due to adequate market supplies owing to the above‑average production harvested in 2021 and large imports between January and October 2022, which were nearly 60 percent above the five‑year average. As of November 2022, prices of rice were 5 percent higher year‑on‑year.

Prices of black beans have been generally rising since mid‑2021, driven by increases in prices of imports from the United States of America, the country’s major supplier of black beans. The lower year‑on‑year imports during the first ten months of 2022 provided additional upward pressure. Prices were more than 20 percent above their year‑earlier levels in November. Similarly, prices of white maize in November were well above their values a year before, reflecting elevated international prices.

Overall, food prices rose steadily in 2022, with the annual food inflation rate officially estimated at 20 percent in November 2022.

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