Agro-processing in Ghana Kwaw Andam Ghana Strategy Support Program International Food Policy Research Institute Presentation to GSSP Side Event, ReSAKSS Annual Conference | Accra October 18, 2016

Brief history Pre-independence Small-scale, cottage industries Post-independence (mostly early 1960s) State-led industrialization to achieve import substitution Large factories for cocoa, sugar, tomato, among others 1980s and early 1990s Partial liberalization and sale of state-owned factories Entry of some cocoa (Cadbury, Cargill) and palm oil processors 2000s and 2010s Proliferation, continued state-involvement Food imports growing rapidly Attempts/plans to revive large-scale projects (Pwalugu for tomato, Komenda for sugar)

What is holding back the processing sector? Low productivity and high cost of production Scarcity of preferred varieties and poor quality Transaction costs, transport, and infrastructure Failure of contract farming and vertical integration as an alternative to imports

Emerging opportunities due to… Urbanizing Ghana Income growth 2004 per capita GDP: $426 2014 per capita GDP: $1400 Diet changes Especially shift to processed foods, especially for urban consumers Expanding export markets (?) Growth of urban and rural populations in Ghana, 2000-2015

What’s for sale? Inventory of processed foods Cities: Accra, Cape Coast, Ho, Koforidua, Kumasi, Sekondi-Takoradi, Sunyani, Tamale Stores: open-air stalls, street vendors, traditional self-service shops, small shops with registers, chain and non-chain supermarkets Categories of processed foods Accra: cereals, tubers, meats and fish, fruits and vegetables, oils and fats, spices Other cities: cereals, tubers, tomatoes, poultry Inventory process Focused on products rather than shops Information on products, manufacturers, ingredients, packaging quality Aimed to cover all products

What can we find on store shelves? A broad range of processed foods More than 1,779 unique products in Accra, including over 100 brands of rice 1,443 brands in Kumasi, Sekondi-Takoradi, Tamale Processed food Group Kumasi Tamale Sekondi-Takoradi Total Milled grains, roots, and tubers 422 191 339 952 Processed tomatoes 177 106 190 473 Packaged poultry and eggs 8 1 9 18 607 298 538 1443

Imports vs. Domestic Products Main sources of imports Country Number of products Share of imports Rice Vietnam 306 53 Thailand 168 29 India 30 5 Tomato Paste China 252 70 Italy 37 10 United States 18

Are there opportunities for processing? Yes, because… Import dominance is in rice and tomato, but a range of packaged, domestically-produced products are available from processing cassava, groundnuts, maize, plantain – 291 locally-processed products in 3 cities; Modern supermarkets have greater product diversity, and are main outlet for domestic food processors Comparing domestic and imported products, packaging quality is actually reasonably high

Thank you! Acknowledgements Co-authors: Ramatu Al-Hassan, Seth Asante, Xinshen Diao, Jed Silver, David Tschirley Reviewers: Todd Benson, Shashi Kolavalli References Ackah, C., C. Adjasi, and F. Turkson. 2014. “Scoping Study on the Evolution of Industry in Ghana.” UNU-WIDER: Learning to Complete Working Paper 2014/075. Washington. Andam, K., R.M. Al-Hassan, S.B. Asante, and X. Diao. 2015. “Is Ghana Making Progress in Agro-Processing? Evidence from an Inventory of Processed Food Products in Retail Shops in Accra.” Ghana Strategy Support Program (GSSP) Working Paper No. 41. International Food Policy Research Institute. Accra. Hollinger, F., and J. M. Staatz. 2015. Agricultural Growth in West Africa Market and Policy Drivers. African Development Bank and Food and Agriculture Organisation. Rome. Robinson, E.J.Z., and S. Kolavalli. 2010. “The Case of Tomato in Ghana : Processing.” Ghana Strategy Support Program (GSSP) Working Paper No. 21. International Food Policy Research Institute. Accra.