Agro-Business In Ghana: Exploring The Economic Prospects Of Industrial Hemp

Agriculture plays a significant role to Ghana’s economy. The sector alone contributes to about 20% of the country’s GDP. It is also crucial to job creation, accounting for about 32% of employment in Ghana. Regardless , there remains vast opportunities to be exploited in the agricultural sector. As the country struggles to create jobs for the chunk number of unemployed youth, growing and expanding the agric sector should be among our top priorities. One way of achieving this goal is to fully embrace the cultivation of industrial hemp.

Hemp is believed to have originated from East Asia. The plant grows very fast and thrives under sunny conditions. This gives West African countries an edge as the region’s agronomic and climate conditions favour growth of the crop.

Opportunities within the hemp industry

Industrial hemp has the potential of becoming the game changer in our seemingly declining textile and clothing industry. Fiber (bast) from hemp is considered ideal for clothing as it is proven to be relatively durable, lighter and tensile. The material also doesn’t shrink easily. Hemp fabrics can be used to produce quality clothings like T-shirts, hoodies, jackets, towels, etc. So far, China, France, Austria and UK are among the list of countries leading in the production of hemp textiles. Again, fiber from industrial hemp can be processed into strong ropes and yarns.

It is well known that Ghana relies heavily on paper. As an import-driven economy, lots of money is spent on purchasing paper products into the country. Between 2017 and 2021, Ghana imported USD 348million worth of toilet papers. In 2023, it was reported that Ghana’s total import of papers, paperboards, pulp of articles and boards were collectively estimated at USD 166.14million. Industrial hemp presents an opportunity to evolve from this pattern. Hemp is one of the reliable sources of paper. The Greenfield Paper Company in the US, Hammond Paper Company in Canada, Hussain Papers in India, among other top brands in the world produce high quality paper products from hemp. Hemp papers are not only good for making magazines and newspapers, but products such as toilet papers, tissues, sanitary pads etc. Unlike wood pulps, hemp papers are resistant to decomposition and discoloration.

Aside from that, hemp serves other essential purposes. Hemp seed, for instance, is a good source of cooking oil. According to research, hemp is rich in proteins, minerals, vitamins, fiber and fatty acids (omega-3 and omega-6). Consumption of hemp improves the heart health, fights inflammation and facilitates neuro-protection. Also, hemp can be used for medicines, biofuels, animal fodders, building materials, skincare and hair products, and even vehicle parts. In 1941, Henry Ford, an American entrepreneur, manufactured a prototype car (Model T) with bioplastics made from hemp. The car also ran on biofuel made from hemp and wastes from other agricultural products in order to reduce greenhouse gas emissions.

The hemp industry has shown significant growth over the past decade. There has been a surge in the market value. The industry’s overall value, estimated at USD 7.90 billion in 2023 is set to reach USD 9.47 billion by the end of this year. A baseline forecast further predicts the growth of the hemp industry to USD 47.82 billion by 2032, reflecting a Compound Annual Growth Rate (CAGR) of 22.44%.

Ecology vs Economy
One of the biggest challenges that confronts the world today is the struggle to bridge the disconnect between industrialization and a sustainable environment. Most often than not, economies flourish at the expense of the ecosystem. Fortunately, we do not have to worry much about environmental implications as far as industrial hemp is concerned. Hemp is biodegradable, thus, products made out of it are eco-friendly. Also, in some situations hemp can be serve as sustainable and even a more suitable alternative to woods, for that matter, lending room to the preservation of trees.

Legal crisis: Demystifying Industrial Hemp and Marijuana

The hemp industry’s nemesis has been a worldwide ban on cultivation of the crop. This is because the distinction between hemp and marijuana, otherwise referred to as ‘weed’ is obscured to many leading to misplaced fears about the crop. Although both marijuana and hemp fall under the same species - ‘cannabis sativa’ - the two are distinguished from each other based on the level of tetrahydrocannabinol (THC). THC is the psychoactive constituent (causing the ‘high’ effect) in cannabis. Whilst Industrial hemp usually contains not more than 0.3% THC, marijuana on the other hand contains between 3% to 15% THC.

Thankfully, laws prohibiting the production of hemp are being relaxed all over the world following a wave of awareness surrounding the plant. In 2018, the US introduced the Farm Bill which legalized the production of hemp for industrial purposes. The bill confined hemp production to not more than 0.3% THC.

Fast forward, in 2020, Ghana also legalized industrial hemp cultivation (under Act 1019). Individuals and businesses can now cultivate industrial hemp in the country under strict licensing conditions. Just like the US, Ghana has also limited the cultivation of the plant to a maximum THC level of 0.3%.

Enough?
Legalizing production of industrial hemp is a step in a great direction. This adds up to the favorable agronomic climate and further strengthens Ghana’s capacity to unlock the full economic potentials of industrial hemp. However, to achieve this goal, we must follow through with ambitious and viable plans and projects. The country must invest in research and infrastructure specifically dedicated to the hemp industry. We must also foster trade cooperations with global partners dominating the hemp industry. Again, the government must enforce flexible and affordable licensing conditions in order to encourage farmers and businesses into venturing the industrial hemp business.

The author is an industrial hemp advocate and an aspiring hemp entrepreneur. You can reach out to him directly via email: [email protected]