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Aquaculture and Food Security, Poverty Alleviation and Nutrition in Ghana

15 September 2014

This Worldfish study provides an overview of the aquaculture sector in Ghana. It assesses the actual and potential contribution of aquaculture to poverty reduction and food security, and identifies enabling conditions for and drivers of the development of Ghana’s aquaculture sector.

The study uses data collected from a variety of primary and secondary sources, including key informant interviews with actors within the aquaculture sector and relevant secondary literature.

Overview of the aquaculture sector in Ghana

Aquaculture is currently practiced in all 10 regions of Ghana, most prominently in the southern and central belts. The main fish species cultivated are Nile tilapia (Oreochromis niloticus) and African catfish (Clarias gariepinus). Tilapia species represent over 90 per cent of farmed fish production.

Pond aquaculture is the main production system in terms of number of farms, and is mainly small scale and semi-intensive. However, in the last five to seven years the dominant culture system for tilapia production has changed, and the vast majority of tilapia is now farmed intensively in cages in Lake Volta. Aquaculture production increased from 950 metric tons in 2004 to over 27,000 metric tons in 2012. This growth is due mainly to increased production from a small number of large-scale cage farms.

Overall, cage farms currently account for less than tqo per cent of farms by number but much more by production. In 2012, for example, aquaculture production from cages was over 24,000 metric tons compared to less than 2,000 metric tons from ponds and tanks. The growth in aquaculture production is also attributed to increased availability of quality fingerlings and feed for fish production.

The number of private hatcheries, which currently produce the majority of fingerlings in Ghana, has increased in recent years as a result of the rapid growth of cage farming. The establishment of a feed mill in Ghana in 2011 by Ranaan, an Israeli company, has greatly improved the reliability and availability of feed supply to fish farmers in Ghana.

Actual and potential impacts of aquaculture on poverty and food security in Ghana

study assesses direct and indirect poverty impacts of small-scale pond aquaculture in Ashanti Region and cage aquaculture by small and medium enterprise — termed “SME” — cage farms in Lake Volta, Eastern Region, drawing on the findings of an earlier study. These findings suggest that overall, aquaculture has higher potential to impact poverty through indirect impact pathways, such as economic multiplier effects, than directly through increasing the incomes and food security of poor fish-farming households.

While poor households have been able to adopt aquaculture in Ashanti Region, small-scale pond aquaculture does not have strong positive direct impacts on the poverty and livelihoods of these households. However, small-scale aquaculture does appear to have positive direct impacts on the livelihoods of non-poor fish-farming households who are trained or use better management practices (termed fish farming type A).

The level of these impacts is dependent largely on the household and livelihood characteristics, as well as the knowledge and management practices, of these farmers and is also likely to be influenced by the infrastructure and institutional context.

There is potential to increase aquaculture’s direct poverty impact, however, if poor fish-farming households are able to overcome their resource constraints and benefit from fish farming type A.

The potential economic multiplier effects and associated backward, forward and consumption linkages are estimated to be stronger for small-scale pond aquaculture (fish farming type A) than for SME cage aquaculture. Thus, for equivalent increases in scale, small-scale pond aquaculture (fish farming type A) is found to have more potential to generate broad-based, pro-poor economic growth than SME cage aquaculture.

Drivers of aquaculture development in Ghana

At present, the actual and potential growth of the pond aquaculture sector is much lower than that of the cage sector. Much of the growth of the sector has come from the establishment and growth of a few large-scale cage farms. The SME cage sector has developed as a result and is now also beginning to take off.

Two categories of key factors are identified as important in driving the development of the sector: i) enabling conditions and developmental processes, such as increasing urban demand for fish, macroeconomic policy reforms encouraging economic growth and foreign direct investment, and government support of the aquaculture sector; and ii) specific events and actors, such as the establishment of the pioneer farms Tropo Farms Ltd. and Crystal Lake Fish Ltd. and the introduction of low-cost cage technology.

The former can be seen as having enabled the latter to be the catalyst for the cage aquaculture sector. Pond aquaculture in Ghana, on the other hand, has not experienced significant growth over the years. It is suggested that the small-scale rural pond sector in Ashanti Region is stuck in a “low-level equilibrium trap.”

This is due to high transaction costs and risks influenced by the demanding techno-economic characteristics of farmed fish — such as perishability, long production cycles, dispersed rural farmers, and the need for multiple and coordinated inputs — which require a high level of institutional development.

Conclusion

Pioneer farms such as Tropo Farms were able to overcome constraints to the sector, such as access to input and output markets, appropriate technology, etc., partly through vertical integration of input supply, production and marketing activities due to their high levels of financial and technical capabilities.

Their success encouraged new SME cage farmers, feed suppliers and fingerling suppliers to make simultaneous and complementary investments in the cage-farmed tilapia value chain, thus helping the sector take off.

Tropo’s ability to overcome constraints through vertical integration (a type of nonmarket institutional arrangement) indicates the importance of institutional innovation for aquaculture development and provides some lessons for the development of the small-scale pond aquaculture sector.

Coordinated value chain development facilitated by institutional innovation is required in order to overcome the challenges to growth of the small-scale pond aquaculture sector in Ghana and thereby maximize its poverty impact potential.

Further Reading

You can view the full report by clicking here.

September 2014

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