As Demand for Fresh Dutch Garlic Grows, Added Value Compensating for Ghana’s Negative Trade Balance with UK

650 views | Akanimo Sampson | July 19, 2021

Spurred by good demand for fresh Dutch garlic, prices appear to be remaining at a higher level than previous year. And in Ghana, adding value to exports seems to be compensating for negative trade balance with UK.

“The circumstances were not easy, but we have made it through again, and at the end of last week, we finished harvesting”, says Arjan Biesheuvel, on fresh Dutch garlic.

“The first garlic that was grubbed arrived in very wet circumstances. It remains to be seen how these will end up after being in CA-storage. For now, harvest seems to be good.”

Biesheuvel sells most of their Dutch garlic to Dutch retailers via Oxin Growers, but through exporters, a lot of garlic also ends up in other European countries.

“Over the past couple of years, we have seen a rise in competition from German garlic growers. This German cultivation also leads to a decline in sales, but this decline is not a steep as previous years. Prices remain on a steady level”, the garlic grower determines.

At the end of June, Arjan personally delivered the first crate of harvested garlic to the Italian restaurant Mario in the Dutch town of Wijdewormer.

“Those are people that can really appreciate the fresh, Dutch garlic, so we can really use their endorsement. To many consumers associate the fresh garlic with the two dried bulbs in a net as you might find in the grocery store, but that has nothing to do with our fresh garlic.

“Luckily, we do see an increasing demand for fresh garlic, so there is enough growth potential for the product. However, in terms of product notoriety, there is still something to be gained. For instance, many people don’t know you can cut up the green stem, which is a waste since you can use every part of our garlic”, says Arjan.

As is tradition, the garlic of Biesheuvel from the CA-storage is available till the end of the year.

In the meantime, the 2020 Business Climate Report has urged Ghana’s horti industry to change its old practice of exporting primary products to the UK, as this has persistently resulted in a negative trade balance at the country’s expense.

The report indicated that the UK imported $242 million worth of goods, while Ghana on the other hand imported S473 million worth of goods from the UK — presenting a negative trade balance of about $231 million.

According to the report, this is largely due to the country’s continuous export of raw materials and import of manufactured goods, coupled with a drop in the level of exports against imports in trade with the UK — a trend that may continue for a long time if nothing concrete is done to change the narrative.

“The goods traded between the two countries have not changed substantially over the period. Ghana’s exports to the UK remain largely primary products, while imports from the UK have mainly been manufactured goods. This accounts for the negative trade balance to the disadvantage of Ghana. Our forecasts show that this trend is likely to continue into the near future”, the report says.

The report further projects that leveraging the Africa Continental Free Trade Area (AfCFTA) agreement could be a game-changer for the country to correct the difference of trade, as it creates a single continental market for goods and services —enabling free movement of businesses, persons, and investment on the back of reduced tariffs and trade barriers.

 

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