Paul Kwabena Amaning
The Oil Palm Development Association of Ghana (OPDAG) has called on the government to urgently clamp down on smuggling and regulatory failures in the oil palm sector, warning that the association may be forced to take its own measures if authorities fail to protect local producers.
President of OPDAG, Mr. Paul Kwabena Amaning, in an interview with the DAILY GUIDE, said regulatory bodies including the Food and Drugs Authority (FDA), the Ghana Revenue Authority (GRA), among other stakeholders need to establish a comprehensive task force to sanitise the oil palm market and restore fair competition.
According to Mr. Amaning, the Food and Drugs Authority has a mandate to ensure that all oil palm products sold in Ghana, both imported and locally produced, are properly registered and licensed.
He stated that unregulated and unpackaged palm oil poses serious food safety risks, and warned that market inspections must be intensified, with offenders arrested and prosecuted.
“People bring palm oil into the country and do not pay the right duties,” he said, adding that some importers exploit the system while others smuggle oil through Ghana’s porous borders. The Association expects to see GRA officials actively monitoring markets and arresting individuals importing palm oil without paying the required duties,” he noted.
Mr. Amaning, who described the current state as dire, told the DAILY GUIDE that the Association would no longer engage in fruitless discussion but expect a coordinated task force to sanitise the market in the shortest possible time.
The OPDAG President also explained that the industry is currently facing its most severe competition crisis, hence the country’s oil palm refineries are unable to sell their products competitively due to the influx of oil imported into the Ghanaian market, with importers failing to pay the required taxes on them.
He said while national demand stands at about 400,000 metric tonnes annually, local production averages between 250,000 and 260,000 metric tonnes, leaving a deficit of about 150,000 metric tonnes to be filled by imports.
Mr. Amaning indicated that importers are however bringing in volumes far exceeding the shortfall, largely through smuggling and tax evasion.
That, he stated, has resulted in imported palm oil been sold significantly at lower prices, making locally produced oil uncompetitive and placing immense pressure on refineries and mills.
He revealed that nearly 90 per cent of palm oil currently on the Ghanaian market is imported illegally, a situation that has led to excess crude palm oil (CPO) and fresh fruit bunches (FFB) piling up across farming communities, preventing farmers from selling their products and leading to widespread losses.
He said farmers are forced to sell below the approved government price of GH¢1,911.21 per tonne, sometimes at discounts of up to GH¢1,200 per tonne, translating into losses of nearly GH¢1 billion annually for farmers nationwide.
“The situation has also affected major processing companies who are reluctant to purchase local produce because they cannot sell the refined oil competitively or export it due to the European Union Deforestation Regulation (EUDR). The regulation requires detailed land documentation to prove production areas are not forest reserves, significantly increasing operational costs.
“With export markets in Europe and West Africa shrinking and the local market flooded with smuggled oil, it is a national security threat. Nearly one million Ghanaians depend directly or indirectly on the oil palm industry for their livelihoods,” Mr. Amaning added.
He further warned that prolonged losses are depriving them of their livelihoods, with some reportedly selling their lands to illegal miners as a result of discounting prices by almost 45 per cent.
Mr. Amaning urged government to urgently strengthen border security, enforce licensing regimes through the Tree Crops Development Authority (TCDA), and ensure that all vegetable oil imports are properly licensed and taxed, citing the example of Kenya where importers require licences and strict volume controls before bringing in vegetable oil.
“Ghana has the installed capacity to process over 600,000 metric tonnes of oil palm annually far above our national demand. The problem is not capacity; it is smuggling, tax evasion, and weak enforcement. If government acts now, this industry can still be saved,” he emphasised.
By Ebenezer K. Amponsah