FMCs petition government to stop cheap wheat flour smuggling from Ivory Coast to Ghana

Flour Milling Companies (FMCs) operating in Ghana have petitioned government through the Ministry of Food and Agriculture (MoFA) to take urgent steps to stop the growing phenomenon of smuggling of cheap wheat flour into Ghana from Ivory Coast by traders.

Traders according to the FMCs, are smuggling cheap wheat flour into the country which is affecting the flour milling companies and distorting the flour market in Ghana.

The flour milling companies made their demands known at a meeting held between them and the MoFA, at the invitation of the Minister through Mr Emmanuel Asante-Krobea, the Technical Advisor to the Minister of Food and Agriculture, on Thursday 18 August 2022.

Ongoing smuggling

The FMCs argue in their petition that “since June this year, there has been an influx of cheap wheat flour from Ivory Coast into Ghana. These wheat flour are subsidised by the Ivorian Government as measures to cushion their milling companies in light of the current global economic situation”.

“In Ivory Coast, Government has reduced the VAT rate from 18% to 9% and Senegal from 18% to 2%. Due to the high cost of flour in Ghana, some traders have taken advantage to transport cheap wheat flour into Ghana from Ivory Coast”.

“However, the export of wheat flour from Ivory Coast has been banned hence the flour are smuggled into Ghana. The volumes of the smuggled flour into Ghana is increasing by the day and this is affecting the sales of Ghanaian flour milling companies” the FMCs observed in their petition.

“As at today 18th August, 2022 the volume of sales of the major local flour milling companies has dropped to almost 50% and consequently resulted in a reduction of production volumes to about 30% production capacity”.

“The smuggled flour has been sighted in many markets and at major bakery shops in Ashanti, Western, Central, Brong Ahafo and Greater Accra Regions”.

“These smuggled flour is sold between GH₵360.00 and GH₵390.00, a bag as compared to GH₵460.00 per bag for flour produced in Ghana”.

“If the situation is not addressed immediately, many flour milling companies in Ghana would have to shut down production” the FMCs petition further read.

Dangers posed

The FMCs contend that “the smuggled wheat flour flowing into Ghana have not been registered with the Food and Drugs Authority (FDA) but are being sold and used in Ghana”.

The smuggled wheat flour according to the FMCs, do not contained requisite “vitamins as required by the Ghanaian Standards of the FDA and this cheap flour influx into Ghana is creating disaffection and raising credibility issues against local flour producers”

“The Ivorian wheat flour contains less than 10% protein as compared to locally produced flour 82% protein. Very soon there will be scarcity of wheat bran (a by-product of wheat milling) in the country for poultry production as Ghanaian companies process less wheat, whiles the bran of the smuggled flour are left in that country” the petitioners noted.

“There will be loss of revenue in taxes to Government as production and sales of local millers’ dip, while the smugglers evade paying the required taxes” the petitioners added.

Actions demanded

To this end, the flour milling companies in Ghana are proposing that as a matter of urgency, government through the Ministry of Food and Agriculture, implement measures such as issuing a strong warning “to perpetrators against the smuggling and sale of the smuggled flour in Ghana”.

Secondly, collaborate with FDA and the security agencies to confiscate all smuggled flour in the country and tighten security at the countries boarders particularly, along the Ghana-Ivory Coast boarder, to arrest culprits and prosecute them forthwith.

Thirdly, the FMCs are requesting of government to consider waiving taxes on wheat imports so as to make Ghana’s wheat flour competitive with imported flour from neighbouring countries and lastly, “sensitize the public to patronize Ghanaian products and to protect local industry”