GHANA - Olam Agri has commenced construction on what it calls Ghana’s first state-of-the-art pasta factory, marking a significant development in the country's food production sector. 

The new facility, located at the company’s flour mill in Kpone, near Tema, is set to bolster local production and reduce the nation’s reliance on pasta imports, which have surged in recent years.

The ceremony, attended by several high-ranking government officials, including Deputy Minister for Trade and Industry, Michael Okyere Baafi, and Deputy Minister for Transport, Frederick Obeng Adom, showcased the government's support for this industrial milestone. 

The event also drew representatives from the Ghana Revenue Authority, the Food and Drugs Authority, and the Ghana Investment Promotion Center, as well as local traditional leaders.

Olam Agri’s new factory, which will source and mill its wheat domestically, is designed to cater to the growing demand for pasta in Ghana and eventually aims to serve neighboring countries. 

Currently, Ghana relies heavily on imported pasta, particularly from Turkey, Italy, China, and South Africa. This factory will play a pivotal role in supporting the government's import substitution strategy, while also contributing to job creation and local economic growth.

Speaking at the event, Trade and Industry Minister K.T. Hammond noted that pasta has become a staple in many Ghanaian households, yet the domestic production is minimal compared to the high demand. 

“Olam Agri’s initiative to build this facility aligns with the government's agenda of promoting local manufacturing, reducing imports, and generating employment,” said Hammond.

Olam Agri’s longstanding presence in Ghana

For over three decades, Olam Agri has been a key player in Ghana’s agribusiness sector. The company, which operates wheat mills in countries across West and Central Africa, including Ghana, Nigeria, Senegal, and Cameroon, is also involved in the production of rice and wheat flour under brands like Mama Gold, First Choice, and Bijou. 

The establishment of the new pasta factory highlights Olam Agri’s continued commitment to investing in Ghana’s food industry.

Baibhav Biswas, Country Head of Olam Agri in Ghana, emphasized the company's dedication to providing high-quality, affordable food products to Ghanaians. 

“This facility is a testament to our longstanding relationship with the people of Ghana, our contributions to economic development, and our effort to enhance food security,” said Biswas. 

He also acknowledged the government’s role in creating a conducive business environment that has enabled the company to thrive.

Competitive landscape

The construction of Olam Agri’s pasta factory signals a competitive shift in the local market. Prima Dufil Foods, another major player in Ghana’s food production sector, opened a US$20 million Indomie noodles and spaghetti manufacturing plant in Tema in 2020, under the government’s One District One Factory (1D1F) initiative. 

This facility has an annual production capacity of 30,000 tonnes of noodles and 8,000 tonnes of spaghetti.

Meanwhile, FMCG distributor Westco Investment has announced plans to build what it claims will be Ghana’s largest pasta factory by 2025. This project, to be developed in collaboration with Turkish pasta manufacturer OBA Makarna, is also poised to enhance local production capabilities, further reducing the nation’s reliance on imports.

Economic context and need for local production

Ghana's economy is currently facing significant financial challenges, with inflation easing slightly but remaining above the central bank’s target. The country’s currency, the cedi, has depreciated by about 36% against the US dollar over the past year, significantly raising the cost of imported goods. In 2023, Ghana imported over US$27 million worth of pasta, with 80% coming from Türkiye alone.

In response to these challenges, the International Monetary Fund (IMF) approved a US$3 billion, three-year credit facility in 2023 to help stabilize the economy. This package aims to address the country's debt levels and promote economic recovery, with GDP growth expected to rebound to 4.4% by 2025.

Amid these economic pressures, Olam Agri’s new pasta facility is seen as a critical development. The factory has the potential to meet the entire demand for pasta in Ghana, while also generating employment and promoting local manufacturing, thus aiding the country's economic recovery efforts.

Outlook for Ghana's food production industry

Despite the financial struggles facing the country, industry leaders are optimistic about the future of Ghana’s food production sector. The construction of Olam Agri’s pasta factory is part of a broader strategy to enhance the country’s self-sufficiency in food production, particularly for mass-market consumer goods such as pasta, edible oils, and household products.

The continued investment in local food manufacturing by both domestic and international firms reflects growing confidence in Ghana’s industrial capacity. As the nation seeks to reduce its dependency on imports, Olam Agri’s project represents a crucial step toward achieving long-term economic resilience and food security.