New potential markets for Ghana’s cassava starch industry has been revealed in a Competitor Analysis report published by the Ghana Export Promotion Authority, GEPA.
According to the report, the new markets including Nigeria and the European markets particularly Poland, Portugal, Italy present strong potentials for market diversification and penetration for Ghanaian companies and Trade Promotion Organisations.
Remarkably, despite Ghana having a huge existing market for cocoa derivatives including chocolate in the Nigerian market, the market share of Ghana’s cassava starch industry in Nigeria, despite its proximity, currently stands at a zero per cent.
In 2018, exports of Ghana’s cassava starch generated close to US$1 million in revenue. However, the United States emerged as the largest importer of the product from Ghana, with an export value of US$935,000, representing 95%, and Italy follows with US$27,000 whiles the remaining, though marginal, was absorbed by the European Union market.
In that same year, US total imports of cassava starch amounted to US$82.2 million with Ghana emerging as the 6th largest supplier of US.
As Ghana is making a commitment to commence the operationalization of the Africa Continental Free Trade Area, AfCFTA, which seeks to increase intra-African trade from the current 12% of member countries total international trade to 52% by 2023, Ghana Export Promotion Authority is cautioning exporters in the industry to target African countries, such as Nigeria, to increase their export sales.
Also, the Authority stipulates that to overcome overlapping export sector priorities, it is vital that industry exporters focus more on increasing its market share in European markets notably Italy, Belgium among others while holding on to its existing market shares elsewhere.
This has become necessary since reports suggest that the implementation of AfCFTA, is likely to push neighbouring African countries around Ghana to become competitors rather than export market destinations with regards to most agricultural products.
How is cassava starch faring on global markets?
Global demand for cassava starch is currently estimated to be more than US$1.8 billion. In 2018, the global cassava starch market reached a volume of 8 million tons, representing a Compound Annual Growth Rate, CAGR, of around 5%.
By 2024, the market demand for the product is expected to be more than 10 million tons, expanding at a CAGR of around 4% from 2019 to 2024, a report conducted by market research firm, IMARC Group discloses.
China remains the largest importer of the product with an estimated import value of US$938 million in 2018. Other notable global importers are Indonesia (US$185.6 million), Taipei Chinese (US$138.1 million), Malaysia (US$123.6 million), USA (US$82.2 million), Japan (US$58.5 million) and Philippines (US$54.4 million) these being the global top 6 importers of cassava starch, with Ghana being ranked in the 57th position regarding the export of cassava starch.
About cassava starch
Cassava starch is produced primarily by the wet milling of fresh cassava roots. Starch is the main constituent of cassava and about 25% starch may be obtained from mature, good quality tubers. About 60 % starch may be obtained from dry cassava chips and about 10 % dry pulp may be obtained per 100 kg of cassava roots. It is widely used in industries such as textile, pharmaceuticals, oil drilling, paper and packaging, gum and adhesives, chemical and household products manufacturing, battery, drinks and beverages, foods among others.
