The government is to maintain the producer price of cocoa at GH¢475 per bag of 61.5 kilogrammes for the 2017/2018 cocoa season, in spite of the fall in the price of the commodity on the international market.
The Minister of Food and Agriculture, Dr Osei Afriyie Akoto, has said, the amount will be paid for the next crop season (2017/2018), usually in the last quarter of the year.
This is expected to bring some relief to cocoa farmers, who are largely anticipating a slight decline in the producer price as a result of the persistent drop in the price of cocoa on the international market.
The price of the commodity on the world market is presently at an average price of US$2,010 per tonne.
The Agric minister explained the amount to be paid to the farmers was based on the prevailing world market price of the commodity which under normal circumstances “should see a reduction in the price paid to the farmers”.
“However, we are keeping to our promise to the farmers to make them happy and fully motivated to produce more of the crop as the government strives to meet its one million tonne target per year”, Dr Akoto said.
The last review of the commodity was done in the 2016/2017 crop season where the price was increased by 11.76 per cent.
As a result, a 64kg bag of cocoa, previously sold at Gh¢ 425, went up to GH¢5475.00, representing a 77.45 per cent increment of the net of the Free on Board (FoB).
Before that review, the average FoB per tonne of cocoa sold was US$2,900, and while for the 2016/2017 year the average FoB is $2,950 per tonne.
For this season, a US$1.3 billion, (GHC5.8 billion) syndicated loan have been approved by Parliament for the purchase of cocoa beans.
Dr Mark Asibey-Yeboah, Chairman of the Finance Committee said the, US$1.3 billion trade finance facility was to assist COCOBOD to raise funds to purchase cocoa beans for farmers through the licensed buying companies.
In a committee report presented to the House before it adjourned sine die, Dr Assibey-Yeboah, said the facility was being provided by a syndicate of banks, comprising Natixis, Standard Bank of South Africa Ltd, Credit Agricole Corporate and Investment Bank, Sumitomo Mitstui Banking Corporation and Ghana International Bank as the initial mandated lead arranger.
The Committee reminded the House of section 32 (6) of the Stamp Duty Act 2005 (Act 689) which required loan documents to be stamped at 0.5 per cent of the loan amount , in order to ensure that the trade finance facility was used solely for the purchase of cocoa beans and related expenses.
The Finance Minister in presenting the reviewed budget before Parliament fortnight ago said “Ghana’s cocoa output, which was over 1 million tonnes in 2010/11 crop year, declined to an average figure of 830,000 tonnes per annum in the past five years; it is the objective of the government to reverse this declining trend and increase production to more than one million tonnes per annum, within the next four years”.
Meanwhile, as part of measures to ensure that Ghana and Code d’ Ivoire, the two biggest producers of the commodity, dictate the prices of cocoa on the international market, their leaders have formed a committee to work out modalities to fix prices.
The two countries presently contribute about 60 per cent of the total world produce and, therefore, have the clout to command prices through various means including controlling the volumes they put on the market at any given time.
Dr Akoto said the team put together to work out the modalities were working assiduously to ensure that the vision of their leaders was fulfilled.
In this regard, Ghana Cocoa Board has rolled out the artificial pollination programmes which are aimed at increasing productivity of cocoa farmers from an average yield of 450kg/ha to over 1,000kg/ha. COCOBOD has trained and deployed 10,000 hand pollinators to assist farmers. It is projected that 24,000 hectares of farms will be pollinated in 2017 with an expected increase to 30,000 hectares in the next three years.
In view of the effects of climate change and the associated harsh weather conditions, COCOBOD is promoting irrigation among cocoa farmers. This has the potential to increase cocoa production and to ensure high survival of transplanted cocoa seedlings.
Irrigation systems are being set up around the cocoa stations and piloted on cocoa farms around the cocoa stations for effective monitoring and evaluation. Private sector companies with experience in irrigation in cocoa farms are leading the process with close collaboration of Cocoa Health and Extension Division (CHED) and Seed Production Division (SPD).
In the light of estimated 22 percent of the country’s current cocoa tree stocks, classified as over-aged/moribund or CSSVD infected, COCOBOD, with support from the government, continued the Cocoa Rehabilitation Programme.
COCOBOD also reformed the Mass Cocoa Spraying to involve greater private sector participation and farmer ownership.
Source: Adnan Adams Mohammed