I think that it is more that the number of YA submissions we get is approximately 9 kajillion times larger than the number of MG submissions, and most people who ARE writing for MG are either writing fantasy along the lines of LIGHTNING THIEF, or are writing glorified chapter books like CLEMENTINE.
There is nothing wrong with either of those things, but... a good old-fashioned "true MG" - like THE PENDERWICKS, for example, or Pat Murphy's book THE WILD GIRLS, or any book by Hilary McKay - or an insanely smart and different MG like MYSTERIOUS BENEDICT SOCIETY -- well, both of those are very hard to come by.
Of course there are SOME. But I think everyone would like to see MORE.
(Also, real mysteries - not fantasy/mysteries.)
Very interesting. This is not the first time I've heard "too many fantasy submissions!" And yet.... That's about all my sons read! Paolini, Riordan, John Flanagan, Funke, Suzanne Collins.... If I buy it for them, they will read some contemporary fiction--Sachar, Spinelli, Andrew Clements--but the ones they ask for are almost always fantasy. And the same is true for all their friends.
So it makes me wonder. Is the real problem not that too many people are submitting fantasy, but that too many people are writing derivative fantasy that just isn't fresh and creative enough? Or they devote so much energy to the world they've created that they forget to learn how to tell a good story?
Second question--what about books like Mary Amato's THE WORD EATER? It has a completely realistic setting that never strays into a single portal. There is only one magical element in it. How does one describe a similar book? I'm concerned that if I query my current WIP as "fantasy" it creates the expectation that I've built a separate world. Magical realism implies events that seem magical to the reader but perfectly normal to the characters. Urban fantasy implies a level of edginess and grit that seems out of place for middle grades. "Slightly fantastical?" Now that just sounds pompous.