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Business News Mon, 17 Oct 2016

Rural Banks urged to fund cash-crop cultivation

Dr. Ahmed Yakubu Alhassan, Deputy Minister of Food and Agriculture has urged the rural banks to release start-up funding for the country’s youth to enable them venture into the production of oil palm on a large scale as the commodity holds great potential for economic growth.

“It is time for our financial institutions to institutionalise agricultural financing to help promote the agricultural sector. The rural banks must release start-up funding for the youth to go into oil palm production,” he said.

Dr. Yakubu Alhassan said this at a close-out the Sustainable West African Palm Oil Programme (SWAPP) workshop organised by the Solidaridad West Africa in Accra which brought together oil palm industrialists from the neighboring Cote d’Ivoire and Nigeria, farmers, policy makers and representatives from the international community.

The Dutch Embassy in Ghana has funded a 4-year SWAPP since May 2012 through a partnership with Solidaridad West Africa. The first phase of the project comes to an end in December, 2016. A regional conference to disseminate results achieved, share lessons learned including data and information needed to attract more investment into the sector.

The SWAPP aimed at improving incomes and livelihoods from oil palm through increased farm productivity and efficiency of processing mills. The program was implemented in Ghana, La Cote d’Ivoire and Nigeria.

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Over the past four years, SWAPP has generated lessons, data and information, tested and validated innovations on how the oil palm sub-sector can be re-vitalized and transformed to respond to the ever growing demand for crude palm oil whilst mitigating the environmental impact in the supply chain.

Dr. Yakubu Alhassan hinted that the sector ministry will strategize with Solidaridad and other private agencies to help develop the cash crop which is currently the second most important crop after cocoa in the country.

“We believe this can be done by joining forces with allies who share the same vision and who are ready to forge strategic, mutually beneficial partnerships to work toward set goals.

“Closing the gaps in this sector and producing oil palm will require concerted efforts from governments, regional bodies, research institutions, private financiers, investors, technocrats, you and I, to insure the proper understanding and utilisation of oil palm,” he said.

According to the Food and Agriculture Organisation (FAO), world production of palm oil is expected to increase from 45 million tonnes to about 60 million tonnes by 2020.

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Africa, which holds 30 per-cent of all oil palm agricultural lands, regrettably produces less than 10 percent of the total world production of palm oil -- with Ghana contributing a distant below-1 percent (0.8 percent).

In the West Africa sub-region, the total crude palm oil market demand stands at approximately 1.6 million m/t.

However, aggregated capacity in the region approximately stands at 800,000 m/t, leaving an estimated growing supply-gap of well beyond 850,000 m/t.

Source: B&FT