Professional Documents
Culture Documents
Fold & Gough (2008) - From Smallholders To Transnationals
Fold & Gough (2008) - From Smallholders To Transnationals
Geoforum
j o u r n a l h o m e p a g e : w w w . e l s e v i e r. c o m / l o c a t e / g e o f o r u m
a r t i c l e i n f o a b s t r a c t
Article history: This paper explores the impact that a new type of pineapple, and subsequent changing consumer prefer
Received 24 May 2007 ences in the Global North, has had on the livelihoods of pineapple growers in Ghana. The paper starts by
Received in revised form 2 June 2008 tracing how research and development in Costa Rica by the world’s largest producers of pineapple, Del
Monte and Dole, have resulted in a new variety MD2. This new pineapple type has been marketed in the
EU through campaigns carried out by plantation companies via supermarkets. Consumer preferences
have subsequently switched to MD2 away from the varieties which previously dominated the market,
Keywords:
including the Ghanaian grown Smooth Cayenne. Ghanaian smallholders have experienced a dramatic
Pineapples
Smallholders
drop in the demand for Smooth Cayenne and are unable to switch to growing MD2. The Ghanaian pineap
Transnational companies ple sector is consequently being restructured with large-scale pineapple farms, principally run by transna
Global value chains tional companies, growing large quantities of MD2 for export. Through a detailed empirical study of the
Livelihoods changing livelihoods of pineapple growers in two settlements in Ghana, we show how smallholders have
Ghana been affected in differing ways as transnational companies have increasingly entered the market. Recent
attempts to incorporate smallholders as producers of niche pineapple products are discussed. The paper
illustrates the mutual benefits of linking global value chain analysis with livelihood analysis.
© 2008 Elsevier Ltd. All rights reserved.
0016-7185/$ - see front matter © 2008 Elsevier Ltd. All rights reserved.
doi:10.1016/j.geoforum.2008.06.004
1688 N. Fold, K.V. Gough / Geoforum 39 (2008) 1687–1697
products into segmented niche markets of higher priced goods. processing, packaging, shipping, storing and marketing of a range
These practices are particularly pronounced in relation to fresh of products.
tropical fruit which is offered in a range of different forms, col
ours, and tastes. Although some consumers are reflexive (Cook, 2.1. The globalisation of fresh pineapples
1994, 2004; Cook et al., 1998), preferences can be constructed or
influenced by advanced marketing campaigns that play on vari Due to the limited development in freight technology for fresh
ous strands of human consciousness. tropical fruit, suppliers of fresh pineapple initially had to be located
Up to the mid 1990s, most fresh tropical fruits were sold in near to major markets. Prior to World War II, almost all European
EU supermarkets together with other FFV products to signal the pineapple consumption was in the form of processed pineapples
diversity and exotic nature of the products on sale. The tropical preserved in sugar water and packed in tins. The modest demand
fruits acted as ‘bait’ to draw customers into supermarkets and as for fresh pineapple in Europe was covered by exports from the
a means to maintain customer loyalty. Since the mid 1990s, how Azores. Consumption of fresh pineapple increased gradually up to
ever, tropical fruits have ‘matured’ as generic products and many the mid 1980s, increasingly supplied by French plantation compa
have been re-formatted into various niche products, often on the nies in Côte d’Ivoire. Central America gradually replaced Hawaii as
basis of their geographical origin or the ethical concerns of con the main supplier of fresh pineapple to the US (Suryanata, 2000)
sumers. These phases of introduction, maturation, re-creation but supplies from Latin America to Europe remained negligible.
and segmentation correspond with shifting forms and degrees of Southeast Asia became the centre for production and processing
competition among suppliers (Reardon and Flores, 2006). In the of pineapples, notably the Philippines and Thailand, and subse
initial introductory phase, competition is low and profits com quently Indonesia. The world market for processed pineapple prod
paratively high as there are few producers and traders upstream ucts, including substantial volumes of juice, has been dominated
in the chain. As more companies (and countries) take advantage by Southeast Asian exporters ever since (Rohrbach et al., 2003).
of the opportunities, the number of suppliers increases, compe From the mid 1980s to the mid 1990s, consumer enthusiasm
tition becomes fiercer and profitability decreases. In the matura for fresh fruit and vegetables grew and sea transport techniques
tion phase, concentration and centralisation takes place among with container cooling systems were developed (Friedland,
suppliers, including both agricultural producers and export 1994). Costa Rica and Honduras increased their exports of fresh
ing/importing companies. If a niche product is successfully con pineapples to the US, with Costa Rica increasingly dominating
solidated, competition on the delivery price will wipe out the in the latter half of the 1980s (Fig. 1). Exports from Costa Rica
weaker suppliers. stagnated in the early 1990s but grew dramatically from the
A classic example is the Kenya-UK vegetable chain. A mixture mid 1990s reaching approximately 700,000 tonnes in 2004.
of public and retailer induced private standards concerning prod Costa Rica has thus come to dominate the global supply of fresh
uct appearance, consumer food safety, the environment, and pineapple. Up to the late 1990s, the EU market was dominated
labour conditions created the institutional setting within which by pineapples from West Africa especially from Côte d’Ivoire.
UK based retailers developed their global purchasing strategies Production in Côte d’Ivoire started to fall after the turn of the
(Dolan and Humphrey, 2004). In the initial phase, despite produc century but West African supplies to the EU have remained rel
ing substantial volumes of vegetables, smallholder production atively constant due to increased export from Ghana (Fig. 2).
and products became increasingly costly as the standards and During the past decade, however, growing demand in the EU has
quality requirements rose. Almost all fresh vegetable production mainly been covered by pineapples from Costa Rica. Recent data
for export is now carried out by large contract farmers linked to indicates that pineapples from Costa Rica had a market share in
large-scale grower/exporter companies with facilities for trans the EU of about 69% in 2007 (up from 44% in 2003) reflecting the
porting, sorting, cooling, packaging, and bar-coding. A small num substantial increase in imported volume from 184,175 tonnes to
ber of smallholders are still involved but they are tightly linked to 573,832 tonnes during the same period (MIR, 2007).
grower/exporters in outgrower schemes and are selected accord The changing trade patterns outlined above are closely related
ing to their ability to deliver the requested quality and quantity to the actions and competitive strategies of a small number of
of particular products. A range of studies confirm these findings transnational companies that have come to dominate the interna
on the importance of standards and their impact on smallholder tional flows of mass-consumed tropical fruits. They are all founded
involvement (Fulponi, 2006; Henson and Reardon, 2005). Recent on trade in bananas, still the most important tropical fruit in world
research documents similar trends and consequences in the sourc trade. The fresh pineapple boom is intrinsically linked to one of
ing strategies of supermarkets located in the Global South (Rear these companies, Fresh Del Monte Produce. Fresh Del Monte Pro
don et al., 2003). duce was one of the first US transnational companies to relocate
The most globally traded fresh tropical fruits (bananas and pine production from Hawaii to Costa Rica in the early 1980s. The com
apples) are primarily produced in large-scale plantations owned by pany benefited from an export credit scheme introduced in Costa
transnational companies who also engage in contractual arrange Rica as part of structural adjustment programmes which made
ments with local producers. Most of the companies have the neces foreign investment more attractive and favoured non-traditional
sary logistic capacity for production in the Global South, shipment exports (Bardham et al., 1992; Clark, 1997). Production was also
(including refrigerated containers and specialised vessels), and stimulated by the US Caribbean Basin Initiative (CBI) that removed
also own trucking companies, distribution and ripening centres
in the Global North. Hence, transnational companies involved in
3
tropical fruit production and distribution muster substantial cor Based on available FAO-data, the share of Ghanaian fresh pineapple on the
EU market was about 7–9% in the late 1990s, dropping a little around the turn of
porate power and do not consent to all the demands of large retail
the century but increasing again to about 7% in 2002–2004. The share decreased
ers. These companies have become vertically integrated category to about 5% in 2005 illustrating the downward slide of exports after the introduc
managers enabling them to control the production, harvesting, tion of MD2. The figures were calculated on the basis of data (in volume terms) on
Ghana’s export and EU’s import of fresh pineapple (see FAO TradeSTAT at http://fao
stat.fao.org/site/535/default.aspx).
4
Del Monte’s growth is linked to pineapple production. According to a 2001
2
A category manger is responsible for the logistics and organisation of a supply stock market report, 20% of company revenue originated from trade in pineapples,
chain in order to provide the right combination of products within a certain cate while pineapples made up 56% of gross profit. The estimated market share for pine
gory to supermarket shelves. apples is 42% (PCIR, 2001).
N. Fold, K.V. Gough / Geoforum 39 (2008) 1687–1697 1689
800000
700000 CostaRica
Ecuador
600000 Honduras
Guatemal
500000
Mexico
Tonnes
400000
300000
200000
100000
1994
1995
1996
1997
1998
1999
2000
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
2001
2002
2003
2004
Year
Fig. 1. Export (tonnes) of fresh pineapples from major Latin American exporters.
250000
Cote d'Ivoire
Ghana
200000
150000
Tonnes
100000
50000
0
86
87
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
19
19
19
19
19
19
19
19
19
19
19
19
19
19
20
20
20
20
20
20
Year
Fig. 2. Export (tonnes) of fresh pineapples from Ghana and Côte d’Ivoire.
many of the tariff barriers for Central American exports (except in the US under the brand name ‘gold extra sweet’ resulting in pine
from Nicaragua). In 1993, Fresh Del Monte Produce obtained a apple exports from Costa Rica regaining momentum.
US patent on a pineapple variety named CO-2 (Loeillet, 2003). A The Fresh Del Monte Produce patent on MD2 expired after a
year later, the company obtained a patent for the same variety in decade enabling other major plantation companies, notably Dole
France, presumably in order to block production in Côte d’Ivoire Food Company, to deal in MD2 from 2003. The resulting massive
and marketing in the EU by other companies. Fresh Del Monte Pro increase in fresh pineapples from Costa Rica first hit the US market
duce subsequently expanded its plantation area in Costa Rica with but as that soon became saturated the EU was targeted. Marketing
the new variety, renamed MD2, and local large-scale farmers were campaigns were carried out by the transnational companies with
subcontracted to do likewise. As MD2 requires advanced cooling, special weeklong in-store stands offering slice tasting backed up
packaging and transportation technology, the company’s facilities by massive advertising in the media. The campaigns promoted the
were upgraded and expanded. Through their control of MD2, Fresh taste, colour, shape and size of MD2. The taste is sweeter and with
Del Monte Produce succeeded in monopolising the entire fresh out the somewhat bitter bite which can characterise Smooth Cay
pineapple chain in Costa Rica, more or less keeping out local and enne. MD2 is more golden in colour and more rounded in shape,
other foreign companies from all segments of the chain (Stamm, yielding slices of approximately identical size. The smaller size
1995; Bardham et al., 1992). In 1996, the new variety was marketed was promoted as being suitable for a family meal removing the
1690 N. Fold, K.V. Gough / Geoforum 39 (2008) 1687–1697
problem of how to store the leftovers in a fridge. Retailers were apple growing areas is through the system of abusa whereby the
also convinced of MD2’s superiority due to its longer shelf-life landowner receives one third of the crop as payment for the use
and easier storability. European consumers consequently turned of the land. In situations of land scarcity, stool members may also
their back on pineapples from West Africa and from being a niche expand their access to land through the abusa system (Alhassan
product on the EU market, Smooth Cayenne slipped to the bottom and Manuh, 2005).
of the price spectrum of fresh pineapple. We now turn to examine Pineapples are predominantly grown in the south of Ghana in
how this changing market for pineapples impacted on pineapple the area where the Eastern, Central and Greater Accra regions con
farmers in Ghana. verge. Pineapples were introduced into the Akwapim Hills in the
Eastern Region in the 1980s by smallholders from the indigenous
3. Ghana’s pineapple production: from smallholders to landholding groups. When the demand for exports rose during the
transnationals 1990s, large-scale cultivators became interested in entering the
market but were unable to obtain large tracts of land in the Akwa
Exports of pineapple from Ghana started in the mid 1980s and pim Hills. They, therefore, headed west and obtained leaseholds
climbed steadily to about 10,000 tonnes in the early 1990s (Fig. for land in the Central Region and Greater Accra Region where they
2). They continued to increase in the mid 1990s, though oscillated set up extensive commercial pineapple farms. In order to explore
during the latter half of the decade. After the turn of the century, the impact of the changes taking place in pineapple cultivation,
exports increased rapidly, filling a vacuum created by decreasing we selected one settlement in the original Akwapim Hills pineap
exports from the civil war encumbered Côte d’Ivoire, resulting in a ple growing area (Pokrom Nsaba) and one in the newly expanding
volume of about 50,000 tonnes. In 2005, however, exports started area further west (Obom) (see Fig. 3). The criteria for selection of
to decrease and recent data indicates that EU imports of pineap the specific settlements were: located in a pineapple growing area,
ple from Ghana were down to about 38,000 tonnes in 2007 (MIR, large proportion of the population involved in pineapple farming,
2007). and the largest settlement in their respective areas.
Until recently, pineapple production in Ghana was character Pokrom Nsaba (hereafter referred to as Pokrom) is located in
ised by smallholder involvement in a non-traditional export chain Akwapim South District in the Eastern Region, approximately half
(Takane, 2004). The smallholders, however, ran into problems a few way between the district capital towns of Nsawam and Aburi. The
years into the new millennium as competition from MD2 eroded road to Nsawam has recently been paved and tro-tros (minibuses)
the demand for Smooth Cayenne. Production transferred increas ply the route frequently. According to oral history, the settlement
ingly into the hands of large commercial companies who had the dates back to around 200 years ago when a road was first made
capital to invest in the necessary cooling and packing facilities for along the valley. The original inhabitants grew basic foodstuffs,
MD2 (see also Danielou and Ravry (2005)). In order to explore the later turning to cocoa farming. When the land could no longer sup
impact on smallholders of the switch in demand from Smooth Cay port cocoa farming, many of the inhabitants migrated west and
enne to MD2, two settlements in contrasting pineapple growing became tenant cocoa farmers in the new cocoa frontier areas. Pine
areas in Ghana were selected for in-depth study. The nature of apples started to be grown in Pokrom in the early 1980s and by
the settlements and the fieldwork conducted are outlined below, the turn of the century most inhabitants were engaged in pineap
before analysing the impact of the changing demand for pineap ple farming in some way. The inhabitants are predominantly from
ples on each settlement in turn. the indigenous land-owning group (the Akwapim) and live in fam
ily-based compound housing. Many have invested in improving
3.1. Setting the scene their homes enabling some to rent out rooms to migrant workers.
According to the official Government of Ghana census, 2181 people
Key to understanding settlement and farming in Ghana is the lived in Pokrom in 2000.
customary system of land tenure which is based on the belief that Obom is located in Ga District in the Greater Accra Region.
‘Land belongs to a vast family of which many are dead, few are Despite being located close to Accra, there is no electricity in Obom
living and countless numbers are still unborn’ (Ollenu, 1962, 4). and all the roads leading there are poorly maintained dirt tracks. No
The allodial rights to land are held by chiefs and elders, or family tro-tros serve Obom but a number of shared taxis brave the roads.
heads, but any member of the stool has usufruct rights to the land Obom is settled primarily by strangers who migrated from the east
(Kasanga and Kotey, 2001). In the past, chiefs granted rights to indi and north of Ghana looking for land to cultivate. According to the
viduals to use land on the basis of a verbal agreement but now these chief and elders and women’s group, only about 15% of those living
transactions have to be registered (Gough and Yankson, 2000). The in Obom are indigenous Ga. Many of the strangers have been living
1969 constitution removed the right to freehold tenure but land off the land for several generations; their ancestors were allowed
may be sold and held as leasehold; the sale of stool land is man to settle and cultivate, as the land was not being used, without mak
aged by the chiefs and elders or family heads. Despite attempts by ing any formal payment or receiving any papers. They grew mainly
the state to intervene by legislature, most land matters are still han food crops both for consumption and for sale. Located on the main
dled by chiefs and elders in accordance with their interpretation Accra-Takoradi railway line, Obom was an important trading post
of indigenous land laws (Asenso-Okyere et al., 1993). The rights of until the railway line was closed in the late 1990s. Today, many of
members of the stool to land continue as long as it is kept under the inhabitants work in a nearby pineapple plantation. According
cultivation. Strangers can acquire access to land, if there is some to the 2000 census, the population of Obom is 1179. The inhabit
available, through a range of means. A common method in the pine ants live mainly in small compound houses with mud walls and
thatched roofs.
5
Fieldwork was conducted in several stages (Table 1). The semi-
A stool is the seat of a chief of an indigenous state (sometimes of a head of
family) which represents the source of authority of the chief (or head of family). structured interviews of the first stage were conducted with key
Land owned by such a state is referred to as stool land. Some individual members of people in the settlements including local education, health and
stools have been given large tracts of land by chiefs which has led to a family land religious leaders; we conducted these interviews in English and
system.
6
A stranger is a non-subject of a clan, tribe, skin or stool hence the term strang
7
ers is used to refer to migrants in the host communities (Kasanga and Kotey, 2001). This project is one of ten which make up the major research programme ‘Rural–
In regards access to land, indigenes and strangers are not on an equal footing and urban dynamics in a globalising world’. A similar three-stage methodology was
strangers do not have a communal right to land. drawn up and followed by all programme members.
N. Fold, K.V. Gough / Geoforum 39 (2008) 1687–1697 1691
Tema District
Ga East
Obom District
Ga West
District
Amasaman
Legon
Tema
Accra District
Accra
0 2 4 6 8 km
0 1 2 3 4 5 Miles
District Boundary Other Towns, Villages A Study Settlements Built-up area 2002
took detailed notes. With the aid of a local research assistant, we had been, involved in working with pineapples and were selected
held focus group discussions with groups of 8–10 people in a mix to cover a range of household types and experiences. The in-depth
ture of English and local languages. The discussions were taped interviews traced the respondents’ life histories focussing on their
and subsequently transcribed. Topics covered included the history experiences as pineapple farmers/workers. Interviews were also
of the settlement, changing livelihoods, mobility, and the cultiva held with large-scale pineapple growers, processors, exporters,
tion and sale of pineapples. Interviews were also held with pine institutions and academics to find out the latest developments in
apple business associations and government institutions. This first the pineapple sector.
stage of fieldwork enabled us to obtain an overview of the char By adopting different research methods we were able to ask a
acteristics of the settlements and the changing livelihoods of the range of respondents about similar issues, which should improve
inhabitants, including pineapple production. A questionnaire sur the validity of the findings. The remainder of this paper builds
vey was conducted in the second stage in order to examine chang upon the fieldwork outlined above and contains some data from
ing livelihoods, mobility and experiences of the pineapple trade all of the different methods used. First, the changing fortunes of
at the household level. In the absence of a census survey, which smallholders in Pokrom and Obom, and how these are linked to
would have enabled a true random sample to be taken, houses the GVC for pineapples, are presented. The focus then turns to the
were selected at random. As the majority of the houses were inhab present day and the attempts made by pineapple growers to find
ited by multiple households, more than one household was often new niches in the global and local markets.
interviewed to cover tenants as well as owners. The questionnaires
were administered by local assistants accompanied at times by the 3.2. Pokrom: smallholders gain and lose a share in the market
authors. The data was subsequently coded and entered into a data
base to facilitate analysis. In the third stage, a return visit was made ‘If you are born here you will be a pineapple farmer’. These were
to 10 households in each settlement. All of the households were, or the words of the chief of Pokrom in 2005. At that time, Pokrom
1692 N. Fold, K.V. Gough / Geoforum 39 (2008) 1687–1697
Table 1
Summary of fieldwork
Stage 1: April 2005 Selection of two study Semi-structured interviews Focus group discussions with chiefs Interviews with pineapple
settlements with local leaders and elders, women’s and youth business associations and
groups (six in total) government institutions
Stage 2: January/February Questionnaire survey with 75 households in each settlement (150 in total)
2006
Stage 3: January/February In-depth interviews with 10 households Focus group discussions with local Interviews with large-scale pineapple grow
and September 2007 in each settlement (20 in total) associations of pineapple growers ers, processors, exporters, institutions,
academics, etc.
was a hive of activity with farmers and workers on their way to Table 3
or from their fields, trucks piled high with pineapples were con Area of land used by pineapple farmers in Pokrom
stantly passing by, workers were busy in a packing shed located Area of land (hectare) Number of farmers (%)
on the roadside, and as far as the eye could see there were pineap
Under 0.5 4
ple fields. The transformation two years later was dramatic. Many 0.5–0.9 28
of the pineapple fields had been abandoned and were overgrown, 1–2 28
the packing shed had been closed, young men were sitting around 3–4 10
with nothing to do, and although the occasional truck loaded with 5–8 10
9–20 8
pineapples passed by there was nothing like the traffic of a cou 21–40 10
ple of years earlier. Pokrom had gone from a booming settlement, Over 40 1
which indigenous people returned to in order to farm pineapples
Sample size 62
and where migrants came looking for farm work, to a stagnating
Source: Questionnaire survey.
settlement where the migrants had moved on and the local youth
planned ways of getting out of their hometown. How did this trans
formation come about and what were the experiences of the pine
apple farmers? 1988 with just a tenth of a hectare and has gradually expanded
Indigenous smallholders started to grow the Smooth Cayenne over the years. None of the farmers were themselves involved in
variety of pineapples in Pokrom in the early 1980s. Initially they exporting. Whilst there was a demand for Smooth Cayenne, the
were sold on the local market but exporters soon started showing smallholders were approached by exporters, often via intermediar
an interest. The amount of land under pineapples subsequently ies. The exporters checked the smallholders’ fields to estimate the
increased and the growing methods changed with an increased volume of potentially harvestable pineapples in order to satisfy a
use of fertiliser and pesticide to increase the yield per hectare. specific order from an EU importer. After agreeing on a price, the
Some of the inhabitants started becoming relatively wealthy from exporter would organise a group of workers to ‘de-green’ (i.e. treat
cultivating pineapples and the word spread resulting in many of with a chemical substance) the selected pineapples a week before
those who had left Pokrom, either to cultivate cocoa further west being harvested. On harvesting day, the pineapples were cleaned,
in Ghana or to work in Nigeria, returning to Pokrom to start pine graded (into different sizes) and packaged in cardboard boxes,
apple farming. The number of pineapple farmers increased slowly sometimes together with pineapples from the exporter’s own plan
at first but then accelerated in the late 1990s. As Table 2 shows, tations. All of the pineapples were trucked on the same day to the
almost half of those interviewed began after the start of the new airport or to the harbour in Tema in order to minimise damage
millennium. In 2006, 83% of the households interviewed were to the fruit. Some of the larger smallholders were used on a con
engaged in pineapple farming in some way and it formed the main tinuous basis to add to supplies from the exporter’s own planta
source of income for over half (56%). Almost all (97%) had a second tion. Although there was no formal written contract, the exporter
source of income and for 22% of these it was pineapple farming. would often order pineapples on a regular basis to maintain the
This shows how pineapple farming was an important source of smallholder within the ranks of their sub-suppliers. Occasionally,
income for almost all households living in Pokrom. reliable smallholders were supplied with inputs, such as fertilizer
One third of the pineapple farmers in Pokrom were cultivating and pesticides, on credit.
land under the abusa system. Many of the farms were very small; The link between the exporters and the smallholders remained
a third were less than one hectare, 60% were 2 hectares or less and tenuous though. The exporters claimed that they could not rely on
only 11% were larger than 20 hectares (Table 3). Even the larger the smallholders to deliver the pineapples whilst the smallholders
farms started small; the largest farm of 210 hectares started in complained bitterly that the exporters did not always collect the
pineapples as agreed and often delayed payment. The exporters
maintained that as they were paid with a considerable time-lag
Table 2 after shipment, their payments to smallholders were inevitably
Year in which farmers in Pokrom started to grow pineapples delayed. The smallholders had no way of checking either the actual
Year started Number of farmers (%) price paid in Europe or the net sum transferred to the exporters in
1980–1989 5 Ghana. Complaints from smallholders in Pokrom about not receiv
1990–1994 18 ing any payments for pineapples supplied were widespread, espe
1996–1999 30 cially after the demand for Smooth Cayenne started to fall. Many of
2000–2005 47
the farmers could produce invoices of up to several million cedis
Sample size 62
Source: Questionnaire survey. 8
There were approximately 10,000 cedis to the dollar at the time.
N. Fold, K.V. Gough / Geoforum 39 (2008) 1687–1697 1693
for pineapples which had been collected by exporters up to two and elders were able to sell leaseholds for large areas of land to the
years previously but for which they had not yet been paid. The large-scale farmers. Initially they cultivated Smooth Cayenne but
chief and elders explained how: as the demand shifted to MD2 they turned to cultivating the latter.
Some started replanting as soon as they saw the need, whereas
‘The exporters are making the farmers poorer and poorer
others waited for government subsidies to purchase the suckers. In
because the pineapples are harvested yearly. If by the end
2004, a grant of US$ 2 million from the World Bank financed Agri
of the year you don’t get your money back it means that you
cultural Sub-Sector Services Investment Programme (AgSSIP) was
cannot continue. The exporter says ‘I will pay you’. Later he
allocated to the Ghana Export Promotion Council for distribution
tells you that his returns have not come from Europe. … At
among large-scale farmers who applied for financial support to
times, after harvesting the fruits they come and tell you that
buy and plant MD2. New companies, primarily with foreign capital
the fruits were delayed and got spoilt so they will only give
including German, French and Italian, entered the scene setting up
you half of the money. Even the half money will be paid
large-scale plantations growing exclusively MD2. Cultivating MD2
to you in instalments. Whether it is true or not, you don’t
requires major investment in new technology as the pineapples
know’.
need to go straight from the harvested field through a well-organ
The outstanding payments for pineapples have caused many of ised cooling chain that stretches from the plantation pack house
the smallholders to lose their capital preventing them from being to the port.
able to afford the necessary inputs to continue farming. The farm Golden Exotics is one of the more recent companies to enter
ers have also been disheartened as Smooth Cayenne is no longer the scene. It is owned by Compagnie Frontière, a French company
demanded on the export market. Smooth Cayenne can, however, in which Dole has a 30% share. Since being established in 2003,
still be sold to pineapple processors, mainly small- and medium- the area of land under cultivation has increased progressively to
scale companies producing juice for the local market, and local mar 1000 hectares. The forecast for 2007 is 16–17,000 tonnes of pine
ket women. There is a considerable price difference, though, with apples increasing to 20,000 tonnes in 2008 and eventually expand
an exporter typically paying twice as much as a processor who in ing to 40,000 tonnes depending on the EU market. When Golden
turn pays twice as much as a market woman. An important proces Exotics was established in 2003, MD2 was selling for 12 Euros per
sor in the region is Blue Skies, a foreign-owned company that pro box in Europe whereas the forecast for 2007 is only 6.7 Euros per
duces sliced fresh fruit for the EU market. Many of the farmers who box resulting in the company claiming to operate on a tight profit
were still growing pineapples in 2007 were the larger farms who margin. One way in which transnational companies, like Golden
had a regular order from Blue Skies (see below). The loss of capital Exotics, try to increase their profit is by controlling every stage of
is also preventing many of the smallholders from turning to grow the process from growing pineapples to delivering them to the
alternative crops or set up new businesses. Even for those who supermarkets. Compagnie Frontière also owns the shipping com
still have some capital, switching to growing MD2 is not an option pany Africa Express Line (AEL) which specialises in shipping fruit
because the investment needed in cooling and packing facilities is from West Africa to Europe. In fact, the incentive for Compagnie
beyond their means, and because the price of suckers is so high. Frontière to set up Golden Exotics was to increase the supply of
Consequently, MD2 is predominantly being grown by large-scale pineapples from Ghana thus making the shipping route more prof
transnational companies located further west as shown below in itable. Until the mid 1990s, most fresh pineapple was transported
the case of Obom. to the EU by air using the surplus capacity of an air freight com
pany that stopped for fuel in Accra on its way back from transport
3.3. Obom: transnational companies enter the scene ing goods from the EU to Brazil. In the mid-1990s, however, three
large-scale exporters started the Sea-freight Pineapple Exporters
Travelling along the unpaved road to Obom, you know you of Ghana (SPEG) with financial support from USAid. SPEG organ
are nearly there when you start spotting yellow bicycles. These ised two weekly departures from Tema harbour with AEL resulting
belong to the workers of Golden Exotics, a large-scale pineapple in sea transport replacing transport by air. In 2004, SPEG shipped
farm located on the outskirts of the settlement, which bought the about 48,000 tonnes corresponding to roughly 85% of total exports.
bicycles to facilitate the transport of workers to the farm. Many Exports by sea have subsequently dropped substantially to about
families living in Obom now have at least one member working 45,000 tonnes in 2005 and 36,000 tonnes in 2006, reflecting the
at Golden Exotics, who with their 500 workers are an important reduced demand for Smooth Cayenne in the EU.
employer for the area. Most of the inhabitants used to grow food SPEG provides shipping services primarily to its 27 member
crops though some switched to growing pineapples in the early companies but others can purchase space if there is surplus capac
years of the new millennium. Initially they made reasonable prof ity. The members are all exporters engaged in considerable, albeit
its but many entered the market just as the demand fell and they highly varied, volumes of production. Members have to produce at
lost considerable amounts of money. In 2006, 21 of the 75 house least 10 hectares and export a minimum of 400 tonnes but about
holds interviewed were still growing pineapples but a further 14 a third of the members cultivate more than 200 hectares. Mem
households had already stopped. Pineapple farming was recorded bers with sunk costs in plantation investments are considered to
as being the most important source of income for only 15% of be committed to the pineapple chain and, therefore, stable stake
households with a further 6% naming it as their most important holders in the sector. By securing supplies on a regular basis and
secondary source of income. Crop farming was the most important avoiding ‘free riders’ who could destroy Ghana’s reputation by
source of income overall (for 35% of households) with a further opportunistic behaviour, the credibility of the Ghanaian pineapple
24% naming unskilled work, including casual work, as their most sector is being maintained. Members are required to use a certain
important income source. quality of packaging cartons and have access to an accepted pack-
Several large-scale pineapple farms were established in the house for cleaning, grading, and packing before the pineapples
area during the 1990s, attracted by the proximity to the harbour at are trucked to Tema harbour. SPEG regulates the industry through
Tema and the abundance of land. With the majority of small-scale its control of access to the vessels10. Its strong domestic position,
farmers being strangers, with no legal right to the land, the chief
10
Pineapple companies have to meet Ghana Standard Board SPS (i.e. sanitary and
9
In February 2007, one MD2 sucker cost 3000 cedis but the kilo price obtained phytosanitary) requirements. Such SPS measures are WTO requirements for interna
for a fully grown pineapple was only 1700 cedis. tional trade.
1694 N. Fold, K.V. Gough / Geoforum 39 (2008) 1687–1697
Local Traders
Ghana
Processors (juice)
Processors (R2E)
R2E: “Ready to Eat”
Consumers
Wholesalers
EU
Consumers
a new factory near Nsawam. The location is ideal for a processing discovered that their customers preferred the Smooth Cayenne
facility as it is located close to the pineapple growers on the main variety when provided in the ready-cut form and are closing down
road leading to Accra. The high-value products are transported their MD2 farm. This illustrates how fickle the European taste, and
daily by air to supermarkets in Europe, primarily the UK. Blue Skies hence the demand for tropical fruit, can be.
has a well-established name in the UK, supplying Sainsbury’s,
Marks and Spencer, Somerfields and Budgens with straight and 4.3. Organic niche: the rehabilitation of sugar loaf
mixed ready-to-eat packets of tropical fruit.
Blue Skies uses primarily Smooth Cayenne pineapples sourced Before exports of pineapples to the EU started, pineapple pro
from 28 selected and trained farmers located mainly in the Akwa duction in Ghana was mainly of another variety named Sugar Loaf.
pim Range. The farmers have the status of formal outgrowers and Compared to Smooth Cayenne it is greener, longer and almost
have been trained in production practices according to EurepGAP12. cone-shaped with pale-whitish flesh. Sugar Loaf was not exported
They must have a minimum of 4 hectares under cultivation, with until recently as wholesalers in Europe did not consider it to be
most having considerably more, in order to supply at least 2000 saleable in Europe due to its shape, colour and easier bruising; as
pineapples every week. Despite the savings which result from the Ghanaian smallholders said, ‘Europeans eat with their eyes’.
more efficient use of agro-chemicals being more or less balanced The Sugar Loaf variety has maintained its popularity in Ghana. It
out by the costs of required facilities (such as toilets, baths and shel is grown primarily in the Central Region, outside the major pineap
ters for farm labourers, and storage rooms for chemicals) farmers ple belt, and is sold in local markets and along roadsides. Recently
are keen to join the outgrower scheme (Gogoe in Dankers, 2003). Sugar Loaf has undergone a dramatic re-evaluation by exporters
The prices are relatively high, payments are regular, and the intro to the UK. Joint efforts by donors (USAid), retailers (Ahold and
ductory training programmes enable the farmers to qualify for cer Albert Hein) and research institutions in the Netherlands and the
tification. As the case of Pokrom illustrated, although the number US have resulted in the establishment of an organisational struc
of farmers cultivating pineapples has declined in the Akwapim ture for the processed, high-value organic pineapple. Sugar Loaf
Range, many of the farmers who are surviving, and even expand is now sold by the upmarket UK supermarket chain Waitrose as
ing, are those who regularly supply Blue Skies. organic processed pineapple chunks that are advertised as being
When the demand for pineapples in Europe switched to MD2, airlifted ‘direct from the African hilltops to UK stores within hours
Blue Skies became concerned about maintaining its supply as of being picked by Fanti tribesmen in Ghana’. The ‘Fanti tribesmen’
the smallholders only grow Smooth Cayenne. Consequently they are about 80 farmers from four settlements in the Central Region
established their own farm where they grew MD2. Ironically, they organised into a Produce Marketing Organisation (the Blue Skies
Organic Collective). The organisation is certified through Blue Skies
12
Blue Skies was one of the first companies in Africa to enter EurepGAP. in accordance with standards of the Soil Association, Fairtrade
1696 N. Fold, K.V. Gough / Geoforum 39 (2008) 1687–1697
and EurepGAP. Due to its previous inferior status, Sugar Loaf has quently the EU. Following aggressive marketing campaigns, con
traditionally been cultivated without costly fertilizer and harvest sumer preference switched from the Smooth Cayenne variety to
ing takes place when the pineapple is naturally ripe. The value- MD2. This has decimated the demand for Smooth Cayenne grown
added processing takes place at the Blue Skies factory where the by smallholders in Ghana resulting in the Ghanaian pineapple
pineapples are peeled, sliced, packaged in 250 g plastic tubs and sector being completely restructured. Large-scale pineapple
chilled before being transported to the airport. The pineapples are farms, principally run by transnationals, are now growing large
on the shelves of UK supermarkets within 24 hours of being har quantities of MD2 for export. As category managers, the compa
vested13. This niche is currently under threat though, as the UK nies control the supply of pineapples (and other tropical fruit) to
Soils Association is considering no longer classifying air freighted the EU, including those feeding into niche markets based on ethi
FFV as organic. In 2007, Blue Skies had managed to negotiate to con cal concerns. Many smallholders have been forced to stop pineap
tinue to supply Sugar Loaf to Waitrose though they were dubious ple production due to non-payment by exporters and are unable
that the order would continue in subsequent years. This illustrates to switch to growing MD2 due to the expenses involved. Some
the volatile nature of export markets. are surviving by becoming suppliers of niche products for the EU
market but this is only an option for the most efficient farmers
4.4. Promotion of MD2: including smallholders in the chain who can comply with the quantitative and qualitative require
ments. Many non-indigenous smallholders have lost their access
Another way of supporting smallholders is to try to include to land following the establishment of the large-scale pineapple
them in MD2 pineapple exports to the EU. A USAid programme companies. All they can hope for is a job as an agricultural low-
entitled ‘Trade and Investment Program for a Competitive Export wage labourer on the large-scale farms.
Economy’ (TIPCEE) has set up a project that aims to help small The exclusion of most smallholders from the Ghana-EU pine
holders become more efficient and market oriented. The project apple chain has not been caused by the same factors as in the
was started in 2005 and is managed by three US based NGOs: Kenya-UK chain for vegetables. Private standards in general, and
Care International, TechnoServe Ghana and American Experience EurepGAP requirements in particular, have been of minor impor
(AMEX). By assisting the farmers in forming producer marketing tance, with the notable exception of their role in the export of
organisations (PMO) and training them on quality requirements processed products to UK retailers. The marginalisation, exclu
and standards, the project aims to enable the PMOs to obtain sion and subsequent partial inclusion of smallholders has been
EurepGAP certification and thereby participate in the supply due to product differentiation by transnational companies with
chains feeding into European retailers. The project targets small the ability to cover the (partly self-constructed) new preferences
holders in areas where the production of non-traditional agricul among EU consumers. Retailers in the EU encounter large transna
tural products, such as various fruits (including pineapple), veg tional companies with highly branded products that are difficult
etables and cashew nuts, takes place. In addition to cultivation to replace with the supermarkets’ own brands. This is because
practices, farmers in PMOs are also trained in keeping financial the transnational plantation companies control substantial parts
records in order to interact with rural banks. They need, how of the pineapple chain from the ownership of land used for cul
ever, to register with the authorities as formal farmers’ associa tivation to controlling the logistics and acting as a gatekeeper to
tions or cooperatives before they can become legal entities eligi supermarket shelves. As category managers, the companies not
ble for loans from formal financial institutions. Besides training, only occupy a commanding position in the supply chain but also
the programme includes digital mapping and establishment of supply the supermarkets with a full range of products. Concerns
GIS-databases for implementation of traceability systems linked for visual appearance, food safety, convenience and ethics (such
to smallholder production (Faalong et al., 2006). as environment and fair trade) are important markers for prod
As of April 2007, about four million MD2 plantlets had been dis uct differentiation and the creation of niche markets. The pine
tributed to a total of 65 farmer groups (including ones in Pokrom apple sector in Ghana illustrates how companies can participate
and Obom) who are developing multiplication nurseries; these in the restructuring process by stimulating niche production by
activities have been financed by part of the World Bank’s AgSSIP qualified smallholders.
scheme via TIPCEE. Each plantlet should yield six suckers which As this paper has illustrated, smallholders are not a homoge
will then be transplanted into the smallholders’ fields. As the pro nous group and the impact of agricultural globalisation processes
ject progresses, more fields will be planted and the first harvests on smallholders in the Global South cannot be characterised in
are expected to take place in early 2008. The PMOs should then be binary terms like included or excluded (Bernstein, 2006). This is,
capable of handling MD2 cultivation and entering into contracts however, the usual way to frame the issue in studies that exam
with exporters organised within SPEG. The main challenges facing ine the impact of globalisation, including standards, on smallhold
TIPCEE, before the programme ends in 2009, are to train PMOs ers. Traditional GVC analysis needs to move beyond a focus on the
to understand the contractual requirements and link them with one-dimensional relationship between firms and smallholders
exporters to establish long-term relationships that match super and incorporate analyses of livelihood implications for different
markets’ time planning horizons of 2–3 years. groups of smallholders. Some of these issues have been taken up
in GVC studies of the living and working conditions for agricul
5. Conclusion tural labour in various agro-based industries (see Kritzinger et al.
(2004) and Mather (2004)) but they are conspicuously absent in
This paper has shown how a thriving smallholder based pine studies of GVCs in which smallholders are predominant. Turning
apple sector in Ghana was gradually eroded by competitive strat to livelihood studies, as de Haan and Zoomers (2005, 33) have
egies of transnational companies with global activities in produc argued: ‘Although transforming structures, mediating processes,
tion, processing and export of tropical fruits. The development institutions and organizations appear in all livelihood frameworks,
and branding of a new pineapple variety, MD2, in Costa Rica there is a tendency within livelihoods studies to downplay these
resulted in the rapid expansion of exports to the US and subse structural features and to focus on capitals and activities’. As this
study has shown, smallholders’ livelihoods can be greatly affected
13
Blue Skies also exports to Albert Hein, a Dutch supermarket chain owned by
by institutions operating on a global scale. Through focussing on
Ahold, one of the largest retailers in the Netherlands with substantial assets in the an empirical case, we have demonstrated how linking bottom-up
US. livelihood studies with top-down GVC analysis can further our
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Acknowledgement Food and Agriculture Organization of the United Nations (FAO), Cheltenham
(UK), pp. 380–401.
This work forms part of the research programme ‘Rural–urban Kasanga, K.R., Kotey, N.A., 2001. Land Management in Ghana: Building on Tradition
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ment Research (Grant No. 91206). The assistance of Mr. Leo Laryea food system: backlighting the role of transnational supermarket chains. Agricul
with the fieldwork is gratefully acknowledged as is Dr. Agnes Budu ture and Human Values 22 (3), 291–302.
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