Latest Info On Food Inflation In Ghana Not Confusing

The airwaves was abuzz in the last week about various figures released on food inflation in Ghana that were described by many as confusing.

The first set of figures was released by Food Security Ghana (FSG) based on a Food Basket Price Barometer that indicated an average increase in food prices over the past 18 months of 73%.

Mr. Kofi Humado, Minister in charge of Ghana’s Ministry of Food and Agriculture (MOFA), questioned these figures.

In a follow-up article FSG quoted figures from the MOFA website on both wholesale and retail prices as measured weekly by MOFA. These figures indicated that the first set of figures might even have been conservative.

On the 11th of April Dr. Philomena Nyarko, Acting Government Statistician announced Ghana’s inflation figures for March 2013.

According to the Ghana News Agency (GNA) she said that food and non-alcoholic beverages group recorded an average year-on-year inflation rate of 5.5 per cent, 0.2 percentage points higher than the 5.3 percent in February. The price drivers for the food inflation were milk, cheese and eggs, mineral water, soft drinks and juices all registering inflation rates between 10.4 and 15.2 percent.

To put the three sets of figures into perspective. According to the Ghana Statistical Service (GSS) the year-on-year March food inflation rate was 5.5%. The Food Basket Price Barometer (FBPB) puts the rate for what they measure at 10.5%. On the other hand the MOFA wholesale market price in Accra over the period for the items quoted by FSG in its article showed an average increase of 47.5%, while the MOFA figures for the same items in the Accra retail market showed an average increase of 51.9%.

The three different sets of figures look at the same pictures from different angles and can’t be compared to each other. Each set of data throws a different light on the same issue, namely the cost of food in Ghana. None are wrong and together they probably present the right perspective of food prices in Ghana.

One of these perspectives, for example, may be the rise in the prices of staple food such as cassava. Banku, fufu, gari and konkonte are all staple foods and made primarily from cassava. If wholesale and retail prices of cassava over 18 months jump by 240% and 260% and over the period of the last year by 107% and 19% respectively red lights should start flickering.

In a poster presented by Mr. M.A. Akudugu ((School of Agriculture, Policy and Development, University of Reading, United Kingdom) at the Joint 3rd African Association of Agricultural Economists (AAAE) and 48th Agricultural Economists Association of South Africa (AEASA) Conference, Cape Town, South Africa, September 19-23, 2010 he made the following statement:

“There is considerable evidence that because poor households spend large shares of their incomes on food and because staples loom large in their food expenditures, lower prices of staple foods significantly increase their purchasing power and real incomes.

Higher real incomes allow greater purchases of non-staples leading to substantial short- and long-term nutritional benefits. On the contrary, high prices for staple foods lead to reduced consumption of nutritious foods with long-term negative effects on health, education and productivity.”

A food inflation price of 5.5% as issued by the GSS may be totally irrelevant to the poor, but such dramatic price increases in basic staple foodstuff such as cassava may put the poorest of the poor at a higher risk of malnutrition and all the negative effects that go with it.

Politicians can say whatever they want but food price watching and barometers such as the above are essential tools to highlight areas of concern and to hopefully trigger more in depth analyses to look at probable causes and possible corrective action.

It is also not only FSG who are highlighting the problem of high food prices. In November 2012 The Finder newspaper conducted a survey in Accra and reported that, “Prices of food items in most markets in the Greater Accra Region have risen sharply over the past three months.”

The paper also reported the following:

“One tomato seller told The Finder that a wooden carton of tomato had risen from GHC70 earlier in the year to GHC450 now, adding that she had no choice but to increase her price.

At both the old and new markets at Kasoa, 5kg of rice hitherto selling at GHC12 now sells at GhC16.5 while half a bag of rice has moved up from GHC55 to GHC72. The same 5kg bag of rice at the Kaneshie market sells between GHC15 and GHC17 while the half bag is going for GHC80.

A bowl of onion now sells at GHC15 from GHC8 two months ago at the Kasoa old and new markets while a bowl (paint container) of tomatoes now sells (for) GHC12. The same bowl of tomatoes was sold for GHC6 only three months ago.”

In May 2012 the Chronicle reported that, “Food Prices Are Squeezing the Life Out Of The Citizens.” In its appeal for government to address the situation the paper reported that, “The high cost of food items is driving many families crazy. There are many homes in the country at the moment, where feeding the family is an uphill task. That is why Mr. Kwesi Ahwoi should lead from the front in finding ways and means of bringing the cost of food items down, rather than his tendency to blame workers for demanding more for their services.”

It is very sad to look at the responses of government when reports of high food prices see the light. The Chronicle reacted to a statement by the then Chief of MOFA, Mr. Kwesi Ahwoi, who said, “workers’ demand for higher wages is what was driving the prices of food items in the country beyond the reach of most Ghanaians.”

In the latest response on the FSG article MOFA’s new Chief Mr. Humado responded as follows, “They should explain what caused the difference between raw produce and prepared food. The report is not scientific and not factual, food situation has improved since last year and the problem we are facing is how to transport the raw food from the farms.”

The fact is that the FSG article said nothing about the production and distribution situation of agriculture, but rather highlighted a situation of high food prices that has subsequently been confirmed from MOFA’s own statistics.

It is truly time that governments welcome the contributions from “watchdogs” and rather than attacking them, accept their inputs as an attempt to truly create a better life for the inhabitants of the country.

Ghanaians are suffering because of high food prices – that is the bottom line! The question now is what can and should be done to assist them?

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