Palm oil is the most important edible oil crop in Ghana and in the whole of West Africa.
In 2010, an FAO research pointed out that Palm oil and palm kernel represent 2% of total agricultural production value of Ghana .
Ghana was the first country were the British established oil palm plantations in the 19th century.
The same seeds and production techniques were then used to establish palm oil estates in another British colony, Malaysia.
Despite the common root, the palm oil value chain in Malaysia and Ghana took two divergent development pathways.
Malaysia is now the world second largest palm oil producer and exporter after Indonesia, while Ghana ranks 15th in terms of production quantity .
Palm oil is getting increasing attention on commodity world markets thanks to several factors including the high yields of palm oil as compared to any other edible oil crop and the level of world production which is going to exceed that of any other vegetable oil.
The increase in supply as well as demand is primarily attributed to the increase in demand for palm oil for bio-fuel production.
Palm oil in Ghana became a commercial crop at the beginning of the 19th century. Originally, the sector was based on wild palm harvesting and later in 1850 oil palm plantations were established and oil palm evolved to an agricultural crop.
This led to palm oil becoming the principal export in the 19th century, accounting for 75% of Ghana’s export revenues.
According to a MOFA report in 2012, Ghana with its 305,758 hectares of area planted and a produced 243,852 tons of palm oil as internal unmet demand was 35,000 tons.
In that same period, the whole ECOWAS region had an unmet demand of 850,000 tons.
On production, 80% of palm oil plantations are owned by small scale farmers who supply both the large estates and small scale processors (MOFA, 2012).
Small scale processors producing crude palm oil account for 80% of total Ghana palm oil production.
The vast majority of processors (80%) are women who are employed in this activity as wage workers.
There are significant differences in palm oil production and processing at the small and large plantation levels.
One of the most striking aspects is the wide variation in the productivity of oil palm in Ghana.
The highest productivity of 20 tons/ha have been recorded by plantations in valley bottoms.
The large estates achieve productivity levels of between 10 – 15 tons/ha. Smallholders and out-growers produce between 7 – 10 tons/ha while private small-scale farms produce about 3 tons/ha.
Production of Palm Oil in Ghana is experiencing a positive trend which started in the early 2000s when the industry was re-launched following several initiatives including seed research and improvements, up scaling of out growers schemes.
However, the increase in the production of fresh fruits has only had a partial rebound in terms of palm oil production.
This is largely explained by the still high incidence of manual processing techniques which are characterized by low extraction rates as opposed to large industries.
If we exclude the picks reached in 2008 and 2009 palm oil production has increased by 10,7% since year 2000.