AGRI-FOOD

Ghana 2018 | AGRICULTURE | B2B

Re-established government stability and support for the agro-business sector will help companies better align supply, production capacity, and demand.

Maik Blaser
MAIK BLASER
CEO
HPW Fresh & Dry
Jai Mirchandani
JAI MIRCHANDANI
CEO
Avnash Industries

What is your growth strategy for the future and how does that reflect market trends?

MAIK BLASER Our client base is mainly packing companies in Europe, either those owned by a retail chain that supply directly to the retailer or packing companies with their own brands for distribution across Europe. We export bulk products that are then shipped to European clients and packed by them under their brands for distribution. A new market for us is Israel, where we have been able to move great volumes over the past 12 months and have started to explore the US market through co-packers. However, we have yet to make any major shipments there. One of the biggest challenges for us is the size of the US because our volumes are relatively small for American companies. In addition to the bulk business, we are also investing in packing and will spin off into retail packed products for certain niche markets in perhaps one year's time.

JAI MIRCHANDANI We know Ghana extremely well and would like to do whatever possible to maximize the use of local resources, which means using raw material as much as possible. We are in key sectors where local raw material is available in abundance though processing capacity is fairly limited. We employ a strategy that relies on developing relationships along the entire value chain. A great deal of it is based on intangible capital that we generate over time. Given that we have been in this country for over 50 years, we hold a strategic advantage. We want to further that brand through a stakeholder-centric and inclusive approach and involve employees, farmers, aggregators, marketers, distributors, consumers, and all stakeholders. The consumption patterns are growing at excess rates due to population increases in Ghana as well as the sub-region. Furthermore, the stable environment in Ghana offers excellent export opportunities.

How do you maintain commercial relationships with distributors?

MB For us, it is important to have a partner rather than simply a distributor so that we can develop the product and quality together. There should be a feedback loop that starts when we acquire a customer. We do a great deal of sampling to find and match the product the customer wants to ensure we continue to develop the product. We also specifically look for partners or companies that are interested in our story in terms of what we do with sustainability and with our staff.

Where do you see the greatest opportunities in Ghana's agro-business?

JM There is an opportunity for crop diversification for year-round yields. This would quadruple the income of agro-business stakeholders that are looking at generating the maximum value. Our businesses are currently focused on domestic and regional consumption. Particularly, the local demand for the rice sector is high, and our mill, which is the largest in West Africa, can only meet 8% of it. Regarding the palm oil market, where we are one of the two main competitors, there is much excess refining capacity versus a wide shortage of raw material. The agro-business sector poses the challenge of filling the capacity of the existing business lines to meet domestic consumption and develop regional export opportunities

How can the government support the agro-business?

MB We would like to contribute to the economy through renewable sources. An investment in solar makes sense for us, especially in Ghana, where we have high electricity costs compared to Europe. We also use a great deal of energy, electricity, and heat for the drying process. We have been able to cut costs by using our waste stream, which is the fruit peels for biogas generation and biomass with coconut shell. From the government we would like to see improved developments in basic infrastructure. We also see efforts already being made on the side of education, and we are employing people with a basic knowledge of how to operate such renewable energy systems.

JM I would not ask for anything; this government is focused on the right strategic priorities and just has to deliver on its promises. The macro situation over the past few years was not the best and should have been addressed earlier. That did not happen because the public sector foundations were weak, though they have turned. There is a long road ahead; however, as long as there is a concerted focus on the agriculture sector, there is money coming in to build the market side of things and that means we will be moving in the right direction.