Four agricultural sector groupings have warned of an imminent food crisis next year and urged the government to do more to increase investment in domestic food production to avert the crisis.
The groupings, which form the largest segment of the agricultural sector, said the measures announced in the mid-year budget review to support stable food supply were commendable but inadequate to avert the danger of food crisis.
They said the cost of cultivating an acre of cereals and legumes, such as maize, rice and soya beans, had shot up astronomically, which could hinder people’s interest in food crop cultivation.
In separate interviews with the Daily Graphic in Accra in response to the Mid-Year Budget review, representatives of the four entities explained that the cost of the items that affected the cost of production, including labour, fertiliser, agrochemicals, seeds and planting materials, mechanisation and other input components, had nearly tripled.
The groupings are the General Agricultural Workers Union (GAWU), the Peasant Farmers Association of Ghana (PFAG), the Ghana National Association of Poultry Farmers (GNAPF) and the Chamber of Agribusiness, Ghana (CAG).
But the Minister of Food and Agriculture, Dr Owusu Afriyie Akoto, while admitting that farm preparation had gone up, said food prices had also gone up to compensate for the rising production cost.
He said there would continue to be food in the system, regretting, however, that the high cost of inputs had been passed on to consumers.
“So the farmer still finds it profitable to produce, and this is why we find food all year round,” he said.
He described the projection of a food crisis next year as premature, explaining that the groups focused on just two aspects of production: chemicals and farm machinery.
However, the General Secretary of GAWU, Edward Kareweh; the Executive Director of PFAG, Dr. Charles Kwowe Nyaaba; the Chief Executive Officer (CEO) of the CAG, Anthony Morrison, and the Vice-President of the GNAPF, Napoleon Agyemang Oduro, were unanimous in their call on the government to examine the rising food inflation locally and in some parts of the world to deploy prompt and comprehensive remedial actions to the looming food crisis.
As a starter, they wanted the government to increase investment in domestic food production, institute measures to provide soft loans and also subsidise mechanisation and other inputs for farmers.
They maintained that at a time when COVID-19 and the Russia-Ukraine war had combined to continuously disrupt supply chains and increase transportation costs, threatening food security globally, inadequate preparation for next season would have a terrifying consequence on the country.
Production cost rises
They converged on the premise that, locally, the cost of cultivating an acre of maize and legumes had risen from GH¢1,581 in 2020 to GH¢4,681 in 2022.
The rising costs also cut across all the phases of production, including land preparation, farm maintenance and postharvest handling, they said.
For instance, ploughing or harrowing an acre of plot cost GH¢120 on average last year, but had shot up to GH¢250 on average this year.
Last year, a unit of seed (Pioneer maize) cost GH¢250 on average; while the same is now going for GH¢410, with a 50kg subsidised fertiliser which sold for GH¢106 last year now selling for GH¢320, with three bags required for a plot of land.
On the open market, the cost of a 50kg fertiliser (NPK) had risen from GH¢160 last year to GH¢400 this year, while the Urea brand had risen from GH¢150 to GH¢430 on the average, with the same going for agrochemicals and other inputs.
The cost of labour had also gone up, as harvesting an acre of maize had doubled to GH¢600 this year.
Should all other factors remain unchanged, the players who represent a large segment in the agricultural value chain maintained that rising production cost alone would impact negatively on the number of farmers who would produce for the next season and subsequently affect output for the market.
Four key measures
Last Monday, the government announced four key immediate measures being put in place to ensure food security when the Minister of Finance, Ken Ofori-Atta, appeared before Parliament to present the mid-year budget review.
They included the placement of a temporary ban on grains (maize, rice and soya) exports, the promotion of the use of organic fertiliser and the cultivation of crops such as roots which require less fertiliser.
Others are to monitor food and input prices to pick early warning signals of potential food crisis in order to take prompt remedial action and finalise modalities for the haulage of produce from farm gates in food growing areas to the market centres.
The Executive Director of PFAG said sector players envisaged a looming food crisis next year which could be worse than the kind currently being experienced.
Dr Nyaaba said that was because the cost of production and inputs had increased tremendously and would impact negatively on the number of farmers who would produce for the market.
“This unusual development will also affect our yields and cumulatively impact on the total food stock that will be available between 2023 and 2024,” he posited.
“If we do not do anything about it, we are likely to see food inflation getting worse than what we are experiencing today. We need to quickly increase investment in domestic production, institute measures for farmers to secure soft loans, and subsidise mechanisation,” he added.
Dr Nyaaba explained that a major reason Ghana was feeling the impact of the COVID-19 and the Russia-Ukraine war was that “we are too dependent on almost all our inputs for production”.
“We need to review our agricultural policy and start to consider local content by creating mechanisation centres and promoting local agro-inputs, add value to our products, as well as promote locally made products,” he said.
Mr Kareweh indicated that temporary restrictions on selected grain exports were ineffective.
According to the GAWU General Secretary, if the ban were effective, the country would still not be experiencing tremendous hikes in food prices.
“So it is difficult for us to agree that the ban is effective because it has not succeeded in driving down prices of food items nor stabilised them. Our intelligence indicates that farmers at the borders are still selling their produce to neighbouring countries,” he said.
He urged the government to inform Ghanaians on how the export restriction on selected grains had been effective to the country’s food security.
Black commodities market
The CEO of CAG said the ban had rather created a black market for smugglers to send the grains, especially soya, to neighbouring Togo.
Mr. Morrision said to ensure the ban was effective, the government needed to put appropriate modalities in place and engage stakeholders in the agricultural value chain.
“The ban on commodities would be effective should sector players be part of the process leading to the directive,” he said, adding that CAG regularly undertook market intelligence on developments in the agricultural value chain.
For his part, the Vice-President of the GNAPF commended the government for the temporary ban, adding that grains were now available on the market, yet they were expensive to purchase for poultry production.
Mr Oduro explained that the increase in prices of the commodities was not due to shortage but rather the impact of the global crisis.
He said during the same period last year, they bought a tonne of maize for GH¢2,500, but the price had almost doubled to aboutGH¢4,000 per tonne.
He added that that had reduced the profit margins of the farmers and also cut jobs created by the poultry sub-sector.
According to the 2020 Population and Housing Census, more than three million Ghanaians of 15 years and above are involved in the agricultural sector, cultivating staple crops, tree crops and forest trees or engaged in aquaculture and capture culture (traditional fishing).
The contribution of the agricultural sector to the Gross Domestic Product has increased from an average of 2.8 per cent over the four-year period ending 2016 to a four-year average of 5.8 per cent in 2020.
Last year, the sector contributed 8.4 per cent to the value of goods and services produced within the country (GDP).