Fish makes up 60 percent of the average Ghanaian’s protein diet. It is the next popular animal protein after chicken and beef and expected to overtake them in a few years. Global trends currently show a growing demand for healthier substitutes to beef and chicken, and fish can be a much leaner and lower calorie source of protein.
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Market Growth/ Industry Structure
The fishing industry in Ghana is generally made up of the marine, inland (freshwater) and aquaculture. The sector is dominated by the marine subsector which has the highest level of production, followed by the lagoon and inland subsectors and then the aquaculture sub-sector. The marine and inland fisheries have recently reached maximum sustainability and have led to declining stocks. In an effort to compensate for the declining marine catches and to meet the demand, aquaculture has been widely promoted with the hope of bridging the gap.
Investment Opportunities in fish farming
Investment opportunities exist in fish farming such as the production of fish feed, rearing, and stocking of high-quality fingerlings and training and capacity building in fish farming.
- Ghana is currently running a monopoly market in fish feed production, but the introduction of another feed mill would promote competitive pricing of fish feed. Presently, Raanan Feeds (Indian company) which is one of the largest feed mills in Ghana, is responsible for 70 percent of total production. Some farmers may opt to import fish feed but it is estimated at a 30 percent increment after import dues and charges.
- There has been an increase in private hatcheries to aid the development of aquaculture, however, there is still a deficit of 50 million fingerlings annually. The deficit supply of fingerlings limits the number of potential fish farmers in Ghana and further leads existing farmers to resort to undesired species to reproduce. There is a market need for a reliable hatchery which can produce fry and fingerlings of high quality.
- Training and education are of the need for the youth across the entire value chain; new fish farming methods, technology, harvesting, draining ponds, stocking cages and ponds and fish farm maintenance are key industry skill requirements. There are numerous opportunities existing for the private sector to fill this gap.
Drivers of the fish farming market
- Increase in Demand for Fish
The increasing demand for fish globally and nationally and the declining supplies facing Ghana’s economy is another reason for the development of aquaculture. In Ghana, more and more people are shying away from red meat as a source of protein due to health implications and are resorting to fish.
- Alleviation of Poverty & Provision of Food Security
These are the major drivers of the market and the development of the sector in general. Also due to the role fishery plays in its contribution to GDP, the government has promoted aquaculture as a means of augmenting the declining marine catches yearly to provide food and employment for the populace.
The aquaculture development in Ghana is constrained by several factors, characterized by two components:
Limited Availability of Inputs
- Lack of fingerling production in Ghana
- Lack of affordable feed throughout Ghana for startups
Lack of Support for Farmers
- Lack of investors due to inadequate information on the profitability of the sector.
- Lack of financial support for small-scale fish farmers
- Absence of research on fish farming practices in Ghana
Forecast Market Growth
From 2009 to 2016, available data collated from the Ministry of Food and Agriculture shows aquaculture’s steady rise in yearly fish production. In comparison to catches of marine and inland fisheries, the output of aquaculture rises steadily every year.
Regulatory and Legal Framework Governing the Fishing Sector
- The Fisheries Act (2002) is the main statute concerning the development and sustainability of fishery within Ghana.
- To ensure the growth of the sector the government has banned the import of fish, in order to encourage local production.
- There is also a 15 percent tax on imported seafood of any kind.
Tax Incentives for the Fish Farming
Some businesses enjoy tax holidays or exemption periods. During these exemption periods, income is not taxable. Fish farming enjoys a five-year tax exemption period, as a tax incentive.
Also, all farming inputs are duty-exempt to promote the industry.
National Policy / Government program for Fish Farming
- In 2017, the government officially launched a $53 million programme at Libga in the Savelugu/Nantong Municipality of the Northern Region to boost aquaculture.
- “West Africa Regional Fisheries Programme” (WARFP) was formed in fulfillment of the objective of the Ministry of Fisheries and Aquaculture Development and the Fisheries Commission’s objective to restock dams and dugouts in the Northern Region. The International Development Association (IDA) of the World Bank presented US$50.3 million funding while the Global Environment Facility (GEF) provided US$3.5 million for its implementation (citifmonline, 2017).
- The programme is expected to directly benefit an estimated 206,000 Marine and Lake Volta fishers, at least 27,000 women fish processors and over 3,000 fish farmers. They also intend to build 100 dams and dugouts with a total water surface area of about 2,860 hectares in 35 districts nationwide.
Market Analysis and Trends
Market Characteristics, Demand, Size, Growth
- Ghana has a high domestic demand for fish and has one of the highest consumption per capita in the world (20 – 25kg/year). UN-Habitat predicts that the growing population and increasing urbanization means the market for Ghanaian aquaculture is also expanding.
- Currently, 87 percent of households in Ghana are recorded to be consumers of Tilapia, especially in the smoked form. It also largely consumed by hotels, restaurants and other food services are in Ghana.
- Typically, for small-scale fish farmers especially, Tilapia is sold directly to consumers or to local processors normally they at subsidized prices. Larger scale farmers, on the other hand, try to dispel the middle women and sell directly to consumers.
- Transportation of fish in Ghana is a major headache for small-scale farmers, especially inland. These farmers may not be close to their ideal consumption sites and so must rely on middlemen to do the sales and distribution else, risk losses.
- A solution here that some farming associations have introduced is to pool their fish and pay for transport collectively to get their fish closer to the consumption centers. Larger scale farmers have no problems sending their produce to outlets in urban centers to sell as they sell on demand to hotels, restaurants and the like.
Consumer Analysis and Key Buying Criteria
About 10,000 MT of fresh fish is harvested from other smaller rivers and lakes each year and processed for sale in urban markets. Inland fishing centers in remote areas are not easily accessible to the major consuming centers. This results in expensive inland fish products and deterioration in quality during distribution.
During the main fishing season, the consumption of fish and in particular fresh fish increases in coastal and inland areas. In the lean season, fish is mostly sold and purchased for consumption in smoked form from local sources.
Ghana’s fish consumption requirement is about 720,000 metric tonnes however, fish supply stands at 400,000 annually. Ghana has a natural potential for aquaculture, yet after years of adoption, aquaculture’s contribution to the economy has been quite low. According to Ghana’s 2018 budget statement, aquaculture contributed 3.5% to Ghana’s Real GDP, a decline in the 5.7% recorded in 2016. The growing population and increasing urbanization in Ghana mean the market for Ghanaian aquaculture is also expanding, hence the need to revamp the sector.