The Executives of the Oil Palm Development Association of Ghana (OPDAG) together with the hundreds of thousands of their members and the entire value chain actors of the oil palm sector are excited about the government’s decision to exempt the sector’s commodities from the 50% reduction in the benchmark value of imports as announced on Monday May 11, 2020.
According to the Executive Secretary of the Association Selorm Quarme, the move will guarantee the continuous employment and sustained livelihoods of a large number of Ghanaian farmers and value chain actors, most of whom are smallholders.
It will also provide a level playing field to ensure that local producers remain competitive in the in the near term while encouraging and attracting the needed investment for the development of the oil palm sector which is waiting to be exploited for the development of the tree crop sector.
“The benchmark value introduced in 2019, gave importers of palm oil in the form of vegetable cooking oils an unfair pricing advantage over local producers” Mr. Quarme said.
“The price advantage to importers pushed a lot of farmers, processors and refiners and other businesses in the oil palm value chain out of business.
We are however excited that a decision has been taken to exempt palm oil and the related cooking oils from this policy, which to us will not only inure to the benefit of all stakeholders especially all those within the value chain but will also make the sector attractive for investment, and for the development of the tree crops sector as envisaged in the Tree Crops Development Authority Act, 2019 Act 1010”
Mr. Quarme noted that prior to the introduction of the benchmark value, a 25liter (Yellow Gallon) of oil produced locally was selling at GH¢145 against GH¢150 for the imported product.
However, when the policy kicked in, whereas the locally produced vegetable oil was still selling at GH¢145, the imported products started selling at between GH¢110 and GH¢120.
“This situation adversely affected the local industry as local producers were faced with the concomitant effects of an unfair competition – a situation that threatened jobs and loss of livelihoods of thousands of smallholder farmers in the value chain, not to mention the effect on investment and expansion of the sector.
The Association since the introduction of the policy, has been advocating for an exemption for the oil palm industry and it is heartwarming to note that the government has listened to this plea and taken the step in the right direction to rescue the industry.
It is therefore a welcoming and a positive development for the local oil palm industry and we urge all members to continue to adopt best practices to ensure the sustainability of the industry.
We thank the president and the government as we look forward to the next big thing – the operationalization of the Tree Crops Development Authority, they indicated.