The launch of Kentucky Fried Chicken (KFC) in Accra recently raises questions about government’s determination to reduce or ban the importation of frozen chicken into the country. The quick-service restaurant brand is owned by US-based restaurant group Yum! The local franchisee, Mohinani Group, plans to open two additional restaurants in Accra by the close of this year. Yum! attributed the rationale for venturing into new markets throughout Africa to the increasing economic growth, growing middle-class and improved political stability on the continent. According to industry sources, KFC Ghana imports broiler chicken from Brazil and South Africa as there are no local suppliers that can conform to the quality standards demanded by Yum! The sources added that KFC has experienced significant growth in the past five years, made possible through partnerships with major integrated suppliers around the world. Investigations by this reporter revealed that one of these companies (name withheld) has expressed interest in setting up an integrated poultry enterprise in Ghana - from the poultry parent stock farms to production of day-old-chicks to feed mills, to broiler-rearing farms and poultry slaughter-houses fitted with cold storage facilities. However, unfavourable policies in the country are preventing the company from setting-up. Ghana imports approximately 200,000 tonnes of chicken per year, which equates to approximately 2.7 million chickens per week. The poultry sector has been experiencing a steep decline. This severe decline is due to the very high cost of production and very low prices of imported chicken, often at prices lower than in their own markets. Other constraints include the high energy tariffs that have increased production costs, lack of credit for expansion, and difficulty in accessing markets. Unfavourable domestic policies have also contributed to the decline by condoning the continuous dumping of subsidised poultry products from the European Union and the United States. According to industry players, the broiler sector has been hard hit by these constraints. By 2005, domestic poultry production was only able to meet 34 percent of demand, as most poultry producers stopped producing broilers for meat altogether and started concentrating solely on the production of eggs. Both government and industry sources have indicated that poultry meat (broiler) production for 2007 fell to below 11 percent of demand. Most of the small and medium-scale producers have completely closed down. In Ghana, local processing of poultry into cut portions to facilitate quick and easy use by consumers is virtually nonexistent. There are two poultry enterprises that have the facility for processing poultry into dressed whole birds, but their operations have not been sustained. Imported poultry products tend to be cheaper by 30-40 percent than locally-produced chicken. Egg sales, however, face relatively minor competition on the market compared to poultry meat - due to the short shelf-life of eggs making imports of cheap eggs impractical. The active commercial poultry production sector in Ghana can be categorised into large-scale (over 10,000 birds), medium-scale (5,000-10,000 birds) and small-scale (50-5,000) enterprises. The domestic commercial farms are mostly privately-owned by individuals or a family. The large-scale category forms about 20 percent of the total poultry sector, producing mainly eggs; most operate their own feed-mill and some maintain a hatchery and parent stock. The level of bio-security practice is high in the large-scale category. In recent times, the country’s broiler feed industry has been declining due to the reduction in domestic broiler production. Most commercial feed millers have shifted to producing layer feed, which constitutes about 90 percent of feed production - with broiler feed only accounting for about 10 percent. Broiler feed is primarily purchased by small-scale backyard poultry producers, although there is seasonal demand from larger producers who raise birds for the festive seasons such as Christmas and Easter. Poultry feed accounts for about 70 percent of the total feed produced in Ghana. Presently, Ghana has about five commercial feed mills with a total installed operating capacity of 500 tonnes per day. However, most feed millers are only producing at about 40-50 percent capacity due to slack demand from the industry. Most of the medium- and small-scale poultry producers are supplied by the commercial feed millers. These feed millers produce mainly mash feed, with only a few producing high feed concentrates and only one pelleting feed. Most small and medium-scale poultry producers prefer the feed concentrate because it is cheaper, convenient and less bulky for transportation. The main ingredients for compound feed are locally-obtained corn or imported yellow corn and wheat bran. Corn typically forms about 50-60 percent of the total feed formulation, and the poultry industry consumes nearly 30 percent of all corn produced in Ghana. This is low in comparison to other countries, according to the USDA Foreign Agricultural Service. During the 2010/11 market year, the animal feed industry of the U.S. consumed 127million tonnes of maize, which accounts for 37.5 percent of the overall production. However, if one excludes the 128million tonnes that went to the subsidised ethanol industry, it accounted for 60.4 percent of the maize grown in the U.S. Analysts say if Ghana had to grow its own chicken to replace the current imports, it would need approximately 243,000 tonnes of maize and 121,000 tonnes of soybeans per year. This provides a huge opportunity for local grain farmers to increase their production. Feed prices in Ghana have been climbing, primarily due to the rising cost of corn. USDA forecast for corn production in the 2011/2012 market year in Ghana is 1,700,000 metric tonnes, up from 1,650,000 metric tonnes in the 2010/2011 market year. This projected increase is due to adequate and timely rains in all the grain-growing areas. Currently, the national average maize yield is estimated at 1.6 tonnes per hectare, according to government sources. The government introduced a 50 percent subsidy on fertiliser starting 2008 to make it affordable and increase fertiliser use, and to ensure a uniform price across the country. According to the government, this direct intervention could increase yields to 2.5 metric tonnes in 2011/2012, up from 1.89 metric tonnes in 2010. Corn is a major staple food crop in Ghana and is the base for several food preparations. Corn is also the main component for poultry and livestock feed, although these industries remain small. A post-survey estimated data obtained from major feed mills in Ghana indicates that about 225,000 metric tonnes of corn is used for poultry feed annually. The local wholesale prices of a 100kg bag of white corn in 2009-2010 ranged from GH¢48.00 to GH¢56.00. Traded corn is the most important cereal crop on the domestic market in Ghana. The challenges are several, but the interventions little; yet poultry farmers believe strongly that a successful broiler industry is one of the keys to growing the agricultural sector in Ghana and creating much-needed jobs. By Michael Sarpong BRUCE (michaelsarpong.bruce@gmail.com)