''The Pineapple Industry Revamping Project: The Case of Ghana''.

The pineapple industry revamping project; the case of Ghana
SOCIAL ENTERPRISE PROPOSAL
THE PINEAPPLE INDUSTRY REVAMPING

PROJECT: the case of Ghana
THEOPHILUS TACKIE-KOMME
GLADYS YAHWAH AFENYO
AGYA-YAW NSIAH
GLADYS OFORI
ANTHONY KOFI ANNAN
November, 2014.
OUTLINE:
1. Introduction
2. Problem Identification
3. Vision
4. Goals and Objectives
5. Solutions
6. Implementation
7. Impact Scaling
8. Financing and Budget
9. Conclusion
10.References
INTRODUCTION:
Agriculture is a major stakeholder in the Ghanaian economy providing employment both in
the formal and informal sectors. In this capacity it exerts greater impact on poverty
reduction; it is very critical for rural development, social stabilisation, environmental
sustainability and serves as a buffer during economic shocks (Ministry of Food and
Agriculture).
As evidenced from the table above, some distinct periods characterize the growth
relationship between the agricultural sector and overall economic performance in Ghana.
Over the period of 1966-1984, overall growth fluctuations followed closely that of the
agricultural growth; this indicated the dominant role of agriculture and the economys high
dependence on this sectors performance; in the late 1970s and early 1980s the sector
reached its peak contributing about 60% to total GDP (Breisinger et al, 2008). In the second
period, from 1985 to 1996, that dominating impact of the agricultural sector on the
economy could not be greatly felt as shows by the next figure;
The agriculture sector began to fall steadily until the services sector took charge as the
leading contributor to Ghanas GDP. As at 2012, the services sector was leading with 49.3%
contribution to GDP with a growth rate of 8.8%, the industry sector was second with a GDP
share of 27.9% with a growth rate of 7%, leaving the agriculture sector as the third largest
contributor to GDP with a share of 23.1% at a growth rate of 2.6% (Ghana Statistical
Service). The figures are worrying and looking at the major role of agriculture in our
economy, the sector must be revamped; hence our interest of a Social Enterprise in that
direction.
Agriculture in Ghana is a very broad scope itself; it includes Fisheries, Forestry, Crops, Cocoa
and Livestock, with crops demonstrating the highest subsector growth (66.2%) by GDP as
showed by the diagram below (Ministry of Food and Agriculture).
Our interest is in the crop sub-sector, and more specifically the pineapple industry. Over the
years, fruits and vegetables production, particularly pineapple enjoyed massive
increment. Between the periods of 1996 to 2004, the production and exports of pineapple
quadrupled reaching a high
of 71,858 Metric
(http://www.spegpine.com).
Despite the fact that, there
is huge market for fresh
pineapples and other
horticultural produce locally
and internationally,
unfortunately, the pineapple
sector which once produced
Ghanas first horticulture
export product (Danielou, 2005) is now facing challenges that have robbed farmers of their
livelihood, exporters are out of business and processing companies have folded up.
PROBLEM IDENTIFICATION
The challenges hitting the pineapple business in Ghana have been blamed on the following;
a) lack of financing for cultivation
b) low quality inputs (especially pineapple suckers)
c) inability of Ghana to adapt quickly to a new pineapple variety, MD2, developed by
Costa Rica, which is now preferred in Europe (Fisher, 2013)
The major problems that have engulfed Ghanas pineapple industry include;
a).Unemployment: The Ghana pineapple disaster as we have coined it, has robbed more
than 500,000 people of their work, mostly farmers (Fisher, 2013); this has contributed to
repeating the highest unemployment rate of 12.90 % ever recorded in the country in 2005
once again as at 17th December, 2014 (http://www.tradingeconomics.com). The farmers
have indicated that they lack the necessary capital to run their farms; the figures are that,
an acre of pineapple farm requires between GH8,000 and GH9,000 to cultivate. This huge
figure of unemployed farmers is very disturbing, and it poses economic and social
consequences to the farmers, their business partners, families and industries.
b).Killing of Industrialization: Fruits processing companies in areas such as Adeiso, Nsawam,
Asamankese and Tema all in Ghana have folded up for the lack of raw materials to bolster
their operations, and their inability to finance the importation of these raw materials.
Stronger companies such as Blue Skies, HPW, Peelco and Pinora at a point in time had to
import more than half (50%) of their raw materials such as mangoes, pineapples and papaya
as they struggle to source them locally. In the long run, this could be very costly for the
processing companies and pose a threat to production sustainability. This cannot be good
news for a country struggling to sustain her middle-income status and possibly improve
upon it.
c).Drastic Loss of Foreign Exchange: Smooth cayenne, Queen Victoria and
Sugar Loaf are three varieties of pineapple produced in Ghana, with the
later concentrated on the local market and the smooth cayenne
constituting about 80% of all Ghanas pineapple export
(http://www.spegpine.com). Beginning from the year 2003 the
European market switched its taste for the MD2 variety developed
by Costa Rica. This has paralysed the exportation of pineapples in
Ghana since, reducing the subsectors contribution to the nations
Figure 1 Sweet Cayenne
GDP drastically. Exports dropped from a yearly 71,000 tonnes

to 35,000 tonnes; and exporters reduced from 50 to 15 companies (Fisher, 2013). To
contrast between the two competing varieties at the international front, smooth cayenne is
a sweet, juicy variety that lacks the bright yellow colour that most people associate with
good pineapples. MD2 on the other hand is a variety though not great for
making juice appears more yellow than smooth cayenne, which the
housewives in Europe associate with a good pineapple. Also, it is a little
more square-shaped than smooth cayenne, so it sits on the supermarket
shelf better (Weinstein, 2011). MD2 is more costly to grow in Ghana due
to the climate conditions and soil; for smallholders and commercial
farmers alike, it is more expensive to grow an acre of MD2 than it is of
smooth cayenne. In Costa Rica, on the other hand, which has ideal
growing conditions for MD2 and massive economies of scale, the cost of
Figure 2 MD2
production is much lower.
4.Lack of Interest in Agriculture by the Youth: The Ghanaian and African youth generally
lack the passion and drive for a career in agriculture. Some perceive a career in agriculture
as physically intensive, demeaning and paying off is very prolonging
(http://youthinfarming.blogspot.com).
VISION:
In the long term, we look at becoming a major stakeholder in the pineapple business in
Ghana and across Africa in areas of production, distribution, processing, exportation and
research in the spirit of excellence, progressive partnership and a high sense of community.
GOALS & OBJECTIVES:

To contribute to revamping the Ghana pineapple industry, we will be registering an
organization to be known as, TYYGA HOLDINGS. The organization will be having a Board,
comprising of seasoned professionals who have distinguished themselves in their respective
career paths and contributed meaningfully to community, to provide advice and coaching
on our technical (core), financial and public relation operations.
We set for our target the following goals and objectives:
1. To contribute to reviving the employability of pineapple farmers and fruit processing
factory workers; and to reduce the general unemployment condition in the country.
2. To progressively revamp pineapple production, processing, exportation and research
in this country through partnership with Government agencies, farmers,
multinational organizations, local NGOs, academic and research institutions,
corporate bodies and other relevant stakeholders.
3. To contribute to economic growth through steadily increasing raw materials needed
by fruit processing companies for their convenience and cost effective operations.
4. To create a platform to stimulate and sustain the interest of the Ghanaian youth in
agriculture.
SOLUTIONS AND IMPLEMENTATION PLAN:

Partnerships:
We hold the following organizations in high
esteem, acknowledge their continuous
struggle to revamp the production, processing
and exportation of pineapple in this country
over the past few years of turbulence; and we
plan to partner with them for the continual
well-being and common good of the Ghanaian people:
a) Ministry of Food and Agriculture
b) Farmers
c)
d)
e)
f)
g)
The General Agricultural Workers Union (GAWU) of the Ghana Trade Union Congress
Exporters
Fruit Processing Companies
Academic Colleges, Faculties and Departments (Crop Science, Agro-processing)
International Organizations: USAID, UKaid, Canadian International Development
Agency (CIDA), Food and Agricultural Organization of the UN (FAO), German
Development Cooperation (GIZ-KfW), World Food Programme (WFP) etc.
h) Local NGOs
i) Other relevant Stakeholders
SHORT TERM: What we seek to do within the next five (5) years.
1.Adoptation and Partnership: In this turbulent pineapple business there is hope as
exploration opportunities are being pursued on the MD2 variety cultivation in the country in
a cost effective way. In the meantime, with exporting firms shipping big volumes by air,
demand for Smooth Cayenne has greatly increased (http://www.acdivoca.org). Sadly, due to
the earlier shock, farmers do not have the ready capital to take advantage of this new
opportunity. The U.S. Agency for International Development under the ADVANCE Program
implemented by ACDI/VOCA, has been supportive distributing 3.5 million disease-free
suckers to 144 smallholder farmers from October 2011 to September 2012. Estimated cost
of production per acre of land is $2,300 (GHs 7,360.00) at 2014 (http://www.acdivoca.org).
ADVANCE went further to link the farmers to large- and small-scale processors and
exporters so that they can sell the crop promptly and efficiently. There are many farmers
willing to go back to the farm but without capital. For the start, we will adopt two of such
farms or partner with these farmers by supporting their farm operations with capital.
2.Direct Investment in pineapple production: We have plans to enter into pineapple
production and farm management. This will be done base on wide consultations and
technical advice from experts. This will create job opportunities for Ghanaians leading to a
reduction in the unemployment rate. This will be a great opportunity to demonstrate to the
youth that, as the most vibrant proportion of the population, our commitment is
desperately needed within the agricultural sector. It will also increase the availability of raw
materials need by fruit processing companies in the country. To see the success of this
project, all relevant stakeholders will be brought on board.
3.Agriculture Ambassadors: We are sincerely committed to this struggle of revamping
agriculture in Ghana, and we will gladly embrace the call of any stakeholder to officially
represent them and lead their agriculture related activities and projects.
LONG TERM: What we seek to add on beginning from the next six (6) years of our operation
and beyond, when our company is matured and well positioned.
1.Increase Partnerships and Investments on other Farms: We will be extending the initial
partnership with two farmers to others who are promising, passionate about going back to
business, but unfortunately lacking the necessary funding. This will also bring back to work a
lot of farm workers who previously loss their jobs.
2.Processing and Exportation of pineapple: We are committed to exhaust the various
opportunities this industry presents to provide employment to many Ghanaians in the long
run. We will be establishing a pineapple processing company, and engage in both the
exportation of processed and raw pineapple. The quality of the products will receive
excellent attention.
3.Training and Capacity Building of farmers: We are committed to contribute towards the
capacity building of smallholder farmers and personnel in the sector in the discharge of their
duties through training programs, workshops and conferences. This we will do in
partnership with relevant stakeholders such as the Extension Department of the Ministry of
Food and Agriculture, Agriculture Faculties and Research Institutions, as well as
International Organizations. It will be free of charge to attract a lot of farmers. These
training programmes will be organized when necessary.
4.Empowerment of farmers and subsector personnel: We will be initiating an incentive
scheme to reward and motivate farmers who distinguish themselves within the subsector.
Special allocation will be made for those who work in deprive communities under stressful
conditions. The incentive/award will be made attractive to empower farmers give off their
best in discharging their duties to promote food security and economic growth.
5.Active participation in research partnership: Research is one area we will be giving great
attention to in the long term, if Ghana wants to reclaim her former glory as a lead exporter
to Europe where the nation receives her highest foreign income within the horticulture
sector. The MD2 variety was developed out of research, and we must not relent in our
efforts in developing a competitive variety. We will exhibit and sustain a robust interest and
support relevant research institutions in the pursuit of this goal.
6.State-of-the-art Storage Facilities to preserve crops of farmers: Investing in technology to
preserve pineapple and reduce their perishability rate is one of our areas of investment in
the long run. We will like to make farmers hopeful, especially small holders, and reduce the
risk they will have to take in this business.
Timeline for Project Implementation:

For the first three months, we will identify promising farmers through collaboration with the
Ministry of Food and Agriculture, and perform technical analysis of their farms; this includes
soil, irrigation and nature of planting inputs like pineapple suckers.
10
By the end of the next month we should have completed signing of contractual agreements
with the two farmers we will be starting with.
From findings, an acre of land can produce between 27000 33000 pineapples. It takes
between 9 18 months to cultivate and harvest a cycle of pineapple, and we will take all
this in consideration.
The above indicates that we will be using approximately two years to complete our first
cycle.
IMPACT SCALING:
Based on the facts and statistics from relevant sources as we have indicated, the proposal
shall succeed in a Social Enterprise in terms of profitability, economic and social impacts;
a) Over 500,000 pineapple farmers lost their jobs due to international switch in taste to
a new variety, MD2, developed in Costa Rica. Some local companies like Golden
Exotics (http://www.makefruitfair.org.uk) are already into MD2 cultivation, while
efforts are in place for an alternative competition.
b) Currently, there is an increasing demand for the local variety, Sweet Cayenne, as
exportation is being done by air in large quantities which ensures that pineapples get
to their destinations timely and perishability rate is reduced as compared to shipping
which takes a lot of time.
c) Farmers, with the experience and skills are committed to go back into business but
without the needed finance and this is where we come in to partner.
The social responsibility component of the project is not misplaced;
a)
b)
c)
d)
Thousands of farmers will be brought back into business

New employment opportunities will be created
Capacity building of farmers through training, conferences and seminars
Empowerment of farmers through incentives and awards
Sustainability
To promote the financial flow for the programmes and projects, these three strategies will
be implemented;
a) Partnership with farmers and other stakeholders
b) Entering into the pineapple production, processing and exportation business
progressively
c) Investment in the capital market upon technical advice from experts.
11
BUDGET:
Starting Budget
ITEM/EVENT:
EXPECTED REVENUE:
QTY
GHc
Starting Capital
20,000.00
TOTAL:
ESTIMATED EXPENDITURE:
An acre of land cultivation
GENERAL ADMINISTRATION:
Communication
Transportation
Stationary
Other administrative cost
GHc
20,000.00
7,360.00 (A)
200.00
1,000.00
500.00
500.00
14,720.00
2,200.00
CONTINGENCY
2,000.00
GRAND TOTAL:
18,920.00
SURPLUS:
1,080.00
NB: (A):- This represents the estimated cost ($2,300.00) of an acre of pineapple cultivation
presented by the U.S. Agency for International Development under the ADVANCE Program
as at 2014 in Ghana cedis.
12
CONCLUSION:
Indeed, no man is an island; we stand connected by social forces and are mutually affected
by our actions and inactions. The problem of one becomes the problem of all. It is very
important that we demonstrate sense of community; care for the dejected, support the
weak and shelter the homeless. We share in the humanist conviction, and believe in the
goodness of live. We say there is hope, when all others begin to dwindle in faith. Our course
for agriculture is a sincere and just one and we are gladly embracing it. We foresee the day
when Ghana will rise again on the international market as a major leader in the production,
processing, and exportation of quality pineapple; the day when majority of Ghanaian
pineapple farmers will go back into business and sustain them; that day will surely come.
Until then, we will not relent in our efforts; we shall continually shout the warriors name,
Team TYYGA and the response shall forever remain, Redefining Smartness..
13
REFERENCES
15 Major Reasons Youth in Africa Do not Like a Career in Agriculture.
http://youthinfarming.blogspot.com/2011/12/15-major-reasons-youth-in-africa-donot.html
A study on the pineapple industry in Ghana.
http://www.makefruitfair.org.uk/sites/default/files/a_study_on_the_pineapple_industry_in
_ghana.pdf
Breisinger C, Diao X, Thurlow J, & Al-Hassan R M. (2008). Agriculture for Development in
Ghana.
http://www.ifpri.org/sites/default/files/publications/ifpridp00784.pdf#page=9&zoom=auto,
-169,533. Retrieved 15th December, 2014.
Danielou M & Ravry C. (2005). The Rise of Ghanas Pineapple Industry: From Successful
Take-off to Sustainable Expansion. Africa Region Working Paper Series. (96).
http://www.worldbank.org/afr/wps/wp93.pdf. Retrieved 16th December, 2014
Fisher M. (2013). Ghana endures major pineapple slump.
http://www.fruitnet.com/fpj/article/159652/ghana-endures-major-pineapple-slump
Ghana Agriculture.
http://www.photius.com/countries/ghana/economy/ghana_economy_agriculture.html
Ghana Statistical Service. (2012). Provisional Gross Domestic Product:2012.
http://www.statsghana.gov.gh/docfiles/GDP/provisional_gdp_2012.pdf. Retrieved 17th
December, 2014.
Ministry of Food and Agriculture. http://mofa.gov.gh/site/?page_id=56
Pineapples production in Ghana.
http://www.spegpine.com/speg/index.php?id=9&n=86f865cf57d01cc77823d4a350b2d32a.
Retrieved 16th December, 2014
Renewing Smooth Cayenne Pineapple Production in Ghana.
http://www.acdivoca.org/site/ID/success-Ghana-Renewing-Smooth-Cayenne-PineappleProduction.
Weinstein J. (2011). A Brief History of Fresh Pineapple Exports in Ghana.
http://developeconomies.com/development-economics/a-brief-history-of-fresh-pineappleexports-in-ghana/
14
APPRECIATION:
Our sincere and deepest gratefulness goes to all the industrious and committed individuals
and organizations connected to the success of the Challenge Season 6:
1. The British Council Ghana and its Management team for this life changing initiative
2. The Board (Mr. Albert Ocran and Dr. Joyce Aryee) for their mentorship and superb
coaching.
3. The Selection Team (Mr. Kojo Oppong Nkrumah, Ms. Ama Daaku and Mr. Paul Adom
Okyere) for their constructive criticism and advice during the selection process.
4. Mr. George Quaye of Charter House and Mr. Sydney Tetteh-Hushie of the British
Council for their brotherly attention and care for our well- being throughout the
show.
5. Madam Larko of Charter House and Ms. Dorothy, our chaperone for being there for
us and attending to our needs.
6. The entire crew of GhOne; we love you. Working with you was fun and very
educative, we learnt a lot about TV production.
7. The Sponsors (Tigo Ghana, Robert Gordon University, University of Salford,
Northumbria University, UMB and Vita Milk) for gracing the program; without you
this would not have been possible.
We will dearly keep you in our hearts.
THANK YOU!!!
15

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