Substantial market opportunities exist in Ghana for increased domestic production of maize, soy, and rice. Currently, imports fill the gap left by limited local supply, and demand for these staple crops is expected to grow as Ghana’s economy continues to expand. Agribusinesses and investors have the opportunity to meet this growing demand and potentially yield significant returns.
Ghana’s economic growth brings rising per-capita income, rapid urbanization, and changing consumer tastes. With these changes, the country expects to see an increase in demand for poultry, eggs, farmed fish, and staple foods – all of which call for a much-needed increase in supply of maize, soy, and rice.
Maize is Ghana’s most widely consumed staple crop, and increasing its production locally will go a long way in ensuring food security in the region. Continued population growth is expected to strengthen the already high internal demand for maize. The expanding poultry and fish farming industries are increasing the demand for animal feed with maize as a primary component.
While white maize remains more widely produced and available, demand for yellow maize is on the rise. Yellow maize is a key input for Ghana’s growing poultry sector. When yellow maize is used in feed, chickens produce eggs preferred by consumers due to the more pronounced yolk color. Poultry consumes about 40% of the current maize market annually (200,00 MT yellow; 200,000 MT white), including 50,000 MT coming from imports. As Ghana’s poultry sector pursues taking over the market from imports of ready-to-eat chicken meat, these farms will add demand for an additional 175,000 MT of yellow maize for use in feed. Aquaculture industries are also stimulating demand for maize as part of fish feed.
Local consumption of soy has grown rapidly, increasing 26% annually over the last decade. This demand is being driven in large part by the use of soy as a key ingredient, along with maize, in poultry feed. Of the 150,000 MT of soy demanded annually in Ghana, approximately 75% goes into poultry feed. The projected growth of the poultry industry, particularly as companies move into broiler production, ensures that demand will persist, creating promising opportunities for investors to capture this expanding market.
There is also growing demand for processed soy for human consumption as oil, milk, and other forms, as well as for use in the chemical industries for paint. The current supply of processed soy is unable to satisfy local market demand, and opportunities for export exist as soy demand globally has increased for biodiesel production and for use in feed for livestock and poultry. The fish feed market represents a smaller, but higher margin investment opportunity.
Domestic consumption of rice is expected to grow significantly in 2016 and beyond, as consumer preference for rice over other grains increases. While Ghana currently produces nearly 400,000 MT of rice per year, the demand for rice necessitates the import of another 500,000 to 600,000 MT, a quantity that will likely increase as consumption further outpaces production. In addition, production of straight-milled, aromatic rice will also need to increase in order to meet the preferences of more sophisticated consumers. As such, there is strong potential for investment in the rice value chain as a means to stimulate local production and earn valuable returns.
Photo: Batik Cloth - Adam Jones