Other Commercial Crops

The main industrial crops are palm oil, cotton, rubber, sugar cane, tobacco, and kenaf, the latter used in the production of fiber bags. None is of strategic economic importance, and all, apart from oil palms, have suffered as a result of the country's economic difficulties. Despite claims that such crops could assist local industrialization efforts, the government has not focused the same attention on this sector as on export crops. For example, sugar cane output has diminished with the closure of the country's two sugar mills, which produced 237,000 tons per year in 1974-76, but only 110,000 tons in 1989. The government has actually encouraged the export rather than the local processing of rubber, rehabilitating more than 3,000 hectares of plantations specifically for export production rather than revitalizing the local Bonsa Tire Company, which could produce only 400 tires per day in 1988 despite its installed capacity for 1,500 per day. By the 1990s, the tobacco sector was expanding and moving toward higher export production. Ghana's dark-fired leaf probably grows too fast and requires too rich a soil to compete effectively with rival crops, but the potential for flue-cured and Burley varieties is good. Pricing difficulties had reduced tobacco production from 3,400 tons in the early 1970s to an estimated 1,433 tons in 1989. Output began to improve in 1990, however, reaching 2,080 tons. The Leaf Development Company was established in 1988 to produce tobacco leaf for the local market and to lay the basis for a future export industry. In 1991, the company's first commercial crop amounted to 300 tons of flue-cured, 50 tons of Burley, and 50 tons of dark-fired tobacco (all green leaf weights), of which 250 tons were exported, earning US$380,000. In 1991 Rothmans, the British tobacco company, acquired a 49.5 percent stake in the company and took over management of the Meridian Tobacco Company in partnership with the state-owned Social Security and National Insurance Trust. Another firm, the Pioneer Tobacco Company, announced a 92 percent increase in post-tax profits of more than ¢1 billion for 1991. The company declared dividends worth ¢360 million, double the amount paid out in 1990. Cotton production expanded rapidly in the early and mid-1970s, reaching 24,000 tons in 1977, but it fell back to one-third of this figure in 1989. Since the reorganization of the Ghana Cotton Development Board into the Ghana Cotton Company, cotton production has steadily increased from 4 percent of the country's national requirement to 50 percent in 1990. Between 1986 and 1989, Ghana saved US$6 million through local lint cotton production. The company expected that between 1991 and 1995, about 20,000 hectares of land would be put under cotton cultivation, enabling Ghana to produce 95 percent of the national requirement.