GHANA – Ghana is set to increase the state-guaranteed price paid to its cocoa farmers by nearly 45 percent for the 2024/25 crop season, aiming to enhance farmers’ incomes and curb the smuggling of cocoa beans out of the country.
According to a Reuters report, this potential rise would mark the second consecutive price hike for Ghana’s cocoa sector.
Earlier in April, Ghana, the world’s second-largest cocoa producer, had already raised the farmgate price by over 58 percent, setting it at 33,120 cedi (US$2,123.08) per metric ton for the remainder of the 2023/24 season.
This mid-season increase followed a similar move by neighboring Ivory Coast, which raised its farmgate price to 1,500 CFA (US$2.53) francs per kilogram from 1,000 CFA francs (US$1.69) last season for the April-to-September mid-crop of the 2023/24 season.
The Ghana Cocoa Producer Price Review Committee has proposed a new price of 48,000 cedi per ton, equivalent to 3,000 cedi per 64 kilograms of cocoa, for the upcoming 2024/25 season starting later in September.
Reuters reported that this decision awaits final approval by the cabinet.
The proposed increase comes amid calls from Ghana’s Civil Society platform for the cocoa regulator to set the minimum farmgate price at 3,662 US dollars per ton for the 2024/2025 season.
Annually, the government announces new farmgate prices for cocoa bags and tons each September, covering the crop season from September of the current year to August of the following year.
Cocoa prices have remained robust this year due to disease and adverse weather conditions affecting production in both Ghana and Ivory Coast, which together supply over 60 percent of the world’s cocoa
The International Cocoa Organization has raised its global cocoa deficit forecast for the 2023/24 season to 462,000 tons from 439,000 tons, citing a market headed for a 45-year low in the stocks-to-grindings ratio.
Ghana’s Cocoa Board had initially planned to launch the 2024/25 season on September 1 with a reduced production target of 650,000 tons. However, sources contacted by Reuters indicate that the opening will be delayed.
The earlier season launch was intended to reduce bean smuggling, a problem exacerbated by low prices and delayed payments to farmers.
Nevertheless, some cocoa farmers and licensed buyers have accused both sides of hoarding beans to benefit from the proposed price hike in the new season.
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