Agriculture is a major driver of economic growth in Ghana, as well as an important source of foreign exchange. In 2021 the amount of arable land was estimated at 20.7% of the country’s 238,500 sq km. That same year roughly 39.5% of Ghana’s workforce was employed in the agriculture sector, while the African Development Bank (AfDB) approximated in a February 2023 report that the sector employed roughly 75% of the country’s rural population. In recent years the government has undertaken a number of initiatives to improve sector efficiency and boost exports, such as the Rearing for Food and Jobs (RFJ) and Planting for Food and Jobs (PFJ) programmes.
The sector is projected to grow at a compound annual growth rate (CAGR) of 2.65% through to 2028 to reach an annual value of $3.8bn. Modern farming techniques, greater access to funding and the utilisation of new technologies, such as drones to monitor crops and identify pest infestations, are expected to play a key role in the sector’s expansion.
Structure & Oversight
The Ministry of Food and Agriculture (MoFA), the sector’s primary regulatory entity, is responsible for overseeing livestock and non-cocoa crops. Its remit includes ensuring food security, raising incomes, fostering greater coordination between institutions, and increasing the country’s competitiveness and integration in international markets. The Ghana Cocoa Board (COCOBOD), which is under the remit of the MoFA, is the leading actor in the cocoa industry, performing critical functions such as quality control, scientific research, and the marketing of cocoa beans and related goods (see analysis). COCOBOD is responsible for not just cocoa, but also for coffee and shea nuts.
In July 2023 Ghana launched the second phase of the PFJ programme. The goal of this five-year plan is to shift the government’s focus from small-scale farms to large ones, as well as reform seed distribution by migrating away from the subsidising of seeds, fertilisers and inputs towards a value-chain system under which the government allots seeds to aggregators, who then distribute them to farmers. Since its launch in 2017 Ghana has invested an estimated GHS4bn ($363m) in the PFJ programme.
Performance & Size
Agriculture, forestry and fishing accounted for 18.8% of GDP in 2022, or $13.7bn, according to the World Bank. An estimated 39.5% of the workforce is employed in agriculture, including nearly 75% of the rural population. According to the Ghana Statistical Service (GSS), the sector expanded by 6% year-on-year (y-o-y) during the second quarter of 2023, accounting for 21% of GDP. The government is working to both create jobs and bolster value add through the Planting for Exports and Development Programme, which aims to increase export earnings by focusing on crops with high export demand, as well as create job opportunities in rural areas.
The MoFA’s 2022 budget exceeded GHS1.1bn ($100m), although this was later reduced to GHS961m ($87.3m) following a mid-year fiscal review. Including internally generated funds, the government contributed GHS668m ($60.6m), or 69.5%, of the amount, while the remaining GHS293m ($26.6m) came from donors. For 2023 the MoFA had a budget of nearly GHS2.2bn ($200m), with the government expected to cover GHS1.3bn ($118m) and donors the rest.
Rice is one of the most important food staples in Ghana. As of 2021 the country had a self-sufficiency rate of 42% for rice, a figure that it expects to increase to 60% under the PFJ programme. According to the Netherlands-based trade organisation IDH – The Sustainable Trade Initiative, Ghana consumes an estimated 1.5m tonnes of rice per year, with around 50% of this amount imported to meet growing demand.
Maize – which is cultivated primarily in the transition zone located between the savannah plains in the north and the forests in the centre of the country – accounts for approximately 70% of cereal output, according to business research firm Mordor Intelligence. In 2020 Ghana produced over 3m tonnes of maize, and the medium-term expenditure framework for the MoFA for 2022-25 projects this figure will reach roughly 4.9m tonnes by 2025. However, a February 2023 report published by the AfDB puts the projected 2025 figure at 5.6m tonnes. In October 2022 President Nana Akufo-Addo officially opened the One District, One Factory project’s Sekyere maize processing factory in the Ashanti Region. The facility is capable of processing 4-5 tonnes of dry maize and 5 tonnes of maize grits per day (see Industry & Retail chapter).
Crops
The crop segment accounts for most of Ghana’s agriculture output. Of the sector’s 2021 GDP contribution of 21% (excluding cocoa), crops comprised 82%, with livestock being the next-largest contributor, at 7.6%. In the second quarter of 2023 the crops segment was up 6% y-o-y, according to the GSS. During the 2023/24 season the country harvested approximately 3.4m tonnes of maize, 789,000 tonnes of rice, 600,000 tonnes of peanuts, 350,000 tonnes of sorghum, 300,000 tonnes of palm oil, 225,000 tonnes of soybean and 210,000 tonnes of millet.
COCOBOD’s cocoa production goal in the 2023/24 season is 820,000 tonnes. This follows an estimated 150,000-tonne loss the previous season due to farmers bringing crops to countries with higher farmgate prices, as well as environmental damage from smallscale gold mining operations (see Mining chapter).
Livestock
While most rural households raise livestock, these efforts are seen as supplementary to agriculture. In June 2019 the MoFA launched the RFJ initiative, a five-year programme to increase livestock productivity. The goal of the initiative is to create a more efficient and competitive livestock industry to increase domestic meat production and reduce imports. However, according to a March 2023 report by the US Department of Agriculture’s Foreign Agricultural Service (FAS), the programme is in need of additional funding. To date, the most support has been provided to poultry producers, as they comprise the largest livestock subsegment. The report projected drops in the sheep, goat and cattle populations during the 2023 market year due to high maintenance costs and, in the case of goats, high demand.
Forestry & Logging
In 2021 the forestry segment accounted for 5.7% of agricultural GDP. According to Ghana’s Forestry Commission, the total volume of natural forest timber harvested in 2021 exceeded 1.64m cu metres, up significantly from the 1.23m cu metres recorded for 2020. The same dynamic applied to harvests of plantation timber, with the 2021 figure coming in at 204,000 cu metres, compared to roughly 125,000 cu metres in 2020. In order to maintain the long-term health of the segment, the commission is undertaking the Ghana Forest Plantation Strategy 2016-40, which sets annual goals for planting new seeds and restoring hectares of degraded forest.
During the first eight months of 2022 exports of wood products surpassed 237,400 cu metres, up 20% y-o-y. Ghana’s two primary goods in this segment were air-dried sawn lumber and kiln-dried sawn lumber, which accounted for just short of 128,000 cu metres and 30,500 cu metres, respectively, or 67% of total export volumes for the segment. The primary markets for these products are in West Africa, although Germany and Greece are also notable destinations for Ghanaian lumber. Plywood saw the greatest jump in exports, up from roughly 2400 cu metres in the first eight months of 2021 to nearly 6500 cu metres over the first eight months of 2022.
Fishing
According to a March 2022 report by the FAS, fish is the preferred source of protein for Ghanaians, with annual fish consumption in the country more than twice the average for the rest of the continent. The industry primarily comprises marine, inland (freshwater) and aquaculture segments, along with storage, preservation, marketing and distribution activities. The segment was a leading driver of GDP growth during the second quarter of 2023, up 12% y-o-y after contracting by 3.3% y-o-y during the first quarter, making it the best-performing subsegment in agriculture for the period. However, fishing accounted for a small portion of sector GDP, at 4.7% in 2021.
Exports & Imports
In 2022 non-traditional goods accounted for an estimated 20.2% of merchandise exports. The value of such products was up 6% at $3.5bn in 2022, according to the Ghana Export Promotion Authority. That same year the country’s leading non-traditional agricultural export not derived from cocoa was cashew nuts, which were up 2.3% y-o-y, bringing in more than $294m in revenue. In 2022 the estimated production of cashews was 200,000 tonnes, and this figure could potentially rise to as high as 300,000 tonnes by 2030. Cocoa paste was the largest source of revenue, at $520.3m.
Ghana was the 29th-largest exporter of palm oil in the world in 2021, exporting a value of roughly $78.1m. ECOWAS member Senegal was the leading market for Ghanaian palm oil, accounting for more than 62%, followed by Niger (13.1%) and the Netherlands (5.4%). However, Ghana imported $289m of palm oil that same year, with the majority of it coming from Malaysia.
In 2021 Ghana imported $1.9bn worth of agriculture and related products, according to the US Department of Commerce’s International Trade Administration (ITA). These imports mainly consisted of items such as rice, wheat, soybean meal and poultry, as local producers have struggled to keep up with increasing demand. The largest foreign suppliers of agriculture products to Ghana, in order, were China, Brazil, the Netherlands, Malaysia and Canada, with consumer-oriented items accounting for nearly half of all such imports.
Fertiliser
Ghana relies on imports of inorganic fertiliser, such as nitrogen, phosphorous and potassium (NPK), as there is no primary production facility located in the country. In 2020 Ghana was the largest importer of fertiliser in West Africa, accounting for 26% of regional imports. According to GCB Bank, Ghana imported $173m worth of fertiliser in 2019, $109m in 2020 and $79m in 2021. Fertiliser use has increased substantially over the past half century, from 1.7 kg per ha in 1971 to 107.4 kg per ha in 2020.
According to the ITA, in 2021 Ghana imported 239,000 tonnes of fertiliser. Before international prices spiked, the MoFA purchased 250,000-350,000 tonnes annually, while COCOBOD purchased 100,000 tonnes. An additional 259,000 tonnes of fertiliser were provided to farmers under the PFJ initiative. Imported NPK fertilisers outside the initiative are charged a 5% most-favoured nation import tariff in addition to other duties and charges, resulting in an extra 12% added to the cost, insurance and freight value.
Supply shortages and high prices both posed challenges at the beginning of 2022, compounded by a decision to reduce subsidies, resulting in payment arrears to suppliers. According to GCB Bank’s 2022 fertiliser report, 10 firms accounted for 98% of all imported fertiliser, with four responsible for 95% of total imports. Roughly 35 to 50 distributors allocate fertiliser to more than 3500 retailers.
Irrigation
In 2022, 3.2% of cultivated land was irrigated, and this is projected to rise to 3.5% by 2026. Around 16,900 ha had been developed under formal irrigation as of 2022, although the MoFA aims to more than double this to 41,500 ha by 2026. Irrigation projects also comprise the construction of dams to develop irrigable areas. For example, the government’s One Village, One Dam initiative intends to build a series of multipurpose dams in northern Ghana by 2026, and $6.3bn has been pledged to the project. This is in addition to the large-scale irrigation projects in pre-feasibility stages, as well as the Tamne Irrigation Project, phases I and II of which have already been completed, with 500 ha of irrigable land developed.
Agro-industry
As of May 2023 the Food and Drugs Authority had registered and certified less than 200 agro-processing enterprises. Despite rising demand for processed goods, inefficient production and inadequate raw materials have hindered the development of a strong processing segment. The local food-processing industry produces less than 30% of all domestic market-sourced processed goods.
The AfDB reported that the share of locally processed agriculture goods had fallen from about 15% in 2001 to 5% in 2019, limiting the development of agro-processing businesses. One area that has felt the impact of this lack of processing is soybeans, as Ghana currently has the capacity to process 10-20% of local production. In July 2022 Herbert Krapa, then deputy minister of trade and industry, announced that the country was planning to implement an aggressive industrial transformation agenda in order to become an industrial value-added exporter and increase non-traditional export revenue to $25bn by 2029.
Outlook
The agriculture sector is anticipated to increase at a CAGR of 2.7% in 2023-28 to $3.8bn. The country is adopting modern farming methods, including better irrigation, to boost production and maximise resource utilisation. Innovative technologies are expected to help farmers monitor crop health, identify pest infestations and manage operations more effectively. Helping farmers implement sustainable practices such as agro-forestry, crop rotation and integrated pest management, could help protect the environment and boost long-term output. Ghana is also improving roads that connect rural areas to markets, an endeavour that is expected to improve the transport of produce, as well as access to inputs like fertilisers and seeds. It is also working to increase foreign direct investment in agriculture, and address challenges related to land tenure and acquisition.
Although cocoa is Ghana’s most notable crop export and the largest revenue-earning product in this sector, there is potential to increase exports of shea butter, cashew nuts, fruits and vegetables, and livestock.
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