Business News of Tuesday, 30 April 2013
The tomato processing factory at Wenchi in the Brong Ahafo Region — Agri Commercial Services Limited which was shut down in 2007, is expected to be revived as a sweet corn processing business within the next two years.
The company is currently conducting an adaptation test on corn as well as evaluating the possibility of canning cowpeas at the factory, pending a smooth take-off in 2015, Kwabena Adu-Gyamfi, Managing Director of the defunct tomato processor, disclosed to the Business and Financial Times in an interview.
In order for the company to have outright control over the supply of raw materials for production, it will grow its own corn to feed the factory and the excess will be sold on the open market, he said.
The revival of the business is expected to cost GH¢10.5million. The Ghana Industrial Holding Company (GIHOC) purchased the factory from Government in 1997, but it was abandoned for some time after that.
Between 2002 and 2007, the factory was re-opened, canning tomato paste with the brand name “Wenchi Fresh”. However, due to erratic supply of the right tomato-breed for processing, the company was shut down in 2007.
“We could not compete with the high demand for fresh tomato, particularly on the open market, as the market women were buying it at higher than the factory price. Even farmers that the company had supported financially and trained in cultivating the required tomato-breed were circumventing us for the relatively higher price on the open market, thus its closure in 2007,” Mr. Adu-Gyamfi lamented.
The company in collaboration with the Ministry of Food and Agriculture, GIZ and other development partners trained about 500 farmers in 15 tomato-growing districts in the Ashanti and Brong Ahafo Regions to cultivate more economic and less watery tomato purposely for processing between 2002 and 2004; but the farmers ended up selling it on the open market.
Ghana’s consumption rate for fresh tomato is reckoned to be about 400,000 metric tonnes a year, but the country only produces about 30 percent of it, thus negatively affecting supply to processing companies in the country.
Following the shut-down of the tomato factory, the company moved into the business of growing tomatoes for sale on the open market. “We have moved away from open-field farming to greenhouse technology, which we learnt from South Africa.
The company is able to produce about 100 tonnes of tomato a year on a land area of 500 square metres, and in the next two years, we shall increase our production to 2,000 tonnes from a land cover of five hectares per year,” Mr. Adu-Gyamfi said.
“Until the necessary measures are adopted to bridge the demand and production gap of tomato in Ghana, no processing company can survive in the midst of this stiff competition for the commodity with market women,” Mr. Adu-Gyamfi observed.
He said there is an urgent need for massive investment in agro-processing as well as vegetable production, adding it is not just important to allocate money to the sector, but also to import modern agricultural technologies for the industry.