Offinso North on course for tomato processing factory with Ghana/diasporan joint venture Featured

It seems the long wait will soon be over for the tomato farmers of Akumadan, district capital of Offinso North, in the Ashanti Region. Though famed as the centre of tomato-growing in Ghana, the district has been overlooked by successive governments for support in establishing a factory which makes use of the local crop.

But Offinso North is now a beneficiary of the One District, One Factory initiative, which has inspired investors and promoters to set up processing factories in areas rich in raw materials.

A team of scientists and entrepreneurs from Ghana and Ghanaians in the UK diaspora has been working in the district since 2017. In collaboration with the Crops Research Institute (CRI), the group, led by John Okyere of FEYN Ghana, has field-tested new local varieties at the Akumadan Irrigation Scheme.

Diasporan participation in Ghana’s economic development is crucial to government policy. “There is a wealth of resources in the Ghanaian diaspora,” says Elizabeth Turkson, a solicitor and the UK liaison member of the Offinso North team. “However, the challenge is how to mobilise these resources and channel them towards specific Ghanaian projects aimed at promoting the country’s industrial development.”

Nucleus farm

One of the biggest challenges facing the tomato processing industry in Ghana is the quality of raw materials. Low yields stem from the varieties cultivated and poor farming practice. These in turn impact negatively on input cost and make fresh tomatoes expensive. These challenges, compounded by inadequate financing models for agribusiness, have plagued the industry for decades.

Gradual progress has been made in the search for suitable local varieties for sale to individuals and for industrial processing. Through the CRI, the Centre for Scientific and Industrial Research (CSIR) is leading this effort.

Historically, tomato processing factories have sourced the raw material directly at the farm gate through a local outgrower scheme that works to a predetermined price agreement. However, when the market price moves against the agreed price, most farmers resort to the fresh market, starving the factories of inputs.

Offinso North is testing a new business model to surmount this problem by establishing a nucleus farm for the factory. This will produce the minimum throughput of raw material needed. The farm is supported by an outgrower scheme; suppliers have been trained in novel agronomic practices and harvesting technologies with support from the Korea Programme on International Agriculture (KOPIA).

The advanced skills transferred to farmers include appropriate planting distances for seedlings transplanted from nursery, staking methodologies and appropriate use of fertiliser to minimise damage to the soil. Staking of plants has never been practised in Akumadan, yet it is commonly used worldwide and ensures good ventilation of plants. Staking also protects fruit from soil damage.

Improved agronomic practices in Offinso North will not only benefit the tomato factory, but be disseminated throughout farmer communities in the district and beyond.

Collaboration works

The Akumadan Irrigation Scheme stands on 2,500 hectares of arable land endowed with two irrigation dams and a recently completed reservoir. The company is ready to grow 200 hectares initially and gradually scale up to meet demand.

The scheme can produce enough tomatoes for the two factories within a 50-kilometre radius (Tomacan in Wenchi and TEPCO in Techiman), in addition to a third factory at Akumadan.

Recent developments in the finance industry, such as the Ghana Incentive-based Risk-Sharing System of Agribusiness Lending (GIRSAL), are very encouraging for the sector. When fully implemented, GIRSAL will significantly reduce the risk associated with lending to agricultural and related businesses.

The complex challenges facing the tomato processing industry in Ghana require a multi-stakeholder approach to their resolution, as Dr Okyere and his team in Offinso North envisage. The support from both CSIR’s crop research division and KOPIA is crucial for raw material development and mobilisation. Also not to be underestimated are the staunch support of the local MP, Augustine Collins Ntim, and district chief executive, David Asare Boakye.

“The collaborative approach towards raw material development, by engaging other stakeholders such as the CSIR and KOPIA, has informed a similar approach towards the factory processing of tomatoes,” Dr Okyere says. “Machinery for processing has been sourced and is expected to be procured and delivered to site in early 2020.”

Shrink imports

In May last year a JoyNews documentary, Desert Tomatoes, reported on how Ghanaian seasonal traders import US$100 million worth of Burkinabè-grown tomatoes every year. The journey to Burkina Faso is fraught with danger, and sometimes claims lives.

Ghana is known to be one of the world’s largest importers of processed tomatoes. This puts further pressure on the value of the cedi.

The Offinso North tomato project introduces a new business model and offers hope of reviving the processing industry in Ghana, reversing a one-sided trade with Burkina Faso and wholesale importation of processed inputs from Europe and China.

(Left-right) The project lead, John Okyere, Elizabeth Turkson (UK liaison team member) and Mark Obeng-Appau (Ghana liaison team member)

 

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