Ghana and Cote d’Ivoire plan to suspend the sale of cocoa beans on the open market, beginning the 2020/2021 season until further notice.
The proposal was made in a presentation to buyers, processors and manufacturers at a meeting of global cocoa industry stakeholders on farmers’ income in Accra, yesterday, according to a source close to the meeting.
The stakeholders are meeting to agree on a floor price mechanism to boost small-holder farmer income.
The source said also proposed was a minimum floor price of 2,600 dollars per tonne, which is being negotiated.
The decision by the world’s largest producers of cocoa is meant to ensure their farmers who bear the brunt to uphold the cocoa industry got a reasonable price.
Meanwhile Yaw Kyei, who was at the opening ceremony, reports that
Vice President Dr Mahamudu Bawumia has assured cocoa farmers of the government’s commitment to put in place policies to ensure that cocoa farmers get a fair share of the wealth generated in the cocoa industry.
He observed that the economic status of the average cocoa farmer was deplorable and unattractive to the youth.
According to him, the economic condition of farmers, if not addressed, would put the industry at substantial risk to the national economy, both in its contribution to employment and to the growth of the country’s economy.
The fact that the majority of farmers are unable to cater adequately for their family, beyond mere poverty existence, is simply unconscionable. It is startling to learn from the president of the World Cocoa Foundation that only six per cent of total value of chocolate goes to farmers. The percentage may be lower in the case of cosmetics and pharmaceutical end uses, he said.
In addition to low incomes, he said cocoa farmers faced a number of challenges, including the growing restrictions in farm expansion into protected forests and high cost of inputs and farm maintenance cost.
“In a situation where farmers cannot recover their marginal cost of higher output, they lose interest in keeping with the demands of good agricultural practices. Productivity suffers. The result is that farmers today are considering alternative land uses.
“Some are converting their cocoa farms to alternatives like rubber, palm, and cash crops. In Ghana, some are giving their lands to immediate high income yielding activities such as surface mining, the Vice President said.
Dr Bawumia said the government had been supporting the Ghana Cocoa Board to implement various interventions to enable the farmers to improve farm productivity, preserve the ecosystem, and discourage unethical labour practices.
However, he said without a favourable price, the effects of the efforts would not be enough to change the situation of farmers.
A satisfactory price of cocoa beans will go a long way to complement the government’s investments in rural infrastructure and improve the wellbeing of the communities.”
“Thus far, COCOBOD and the Government of Ghana have taken steps to improve the condition of the cocoa farmer; he said and urged the stakeholders at the meeting to help tackle the concerns of farmers in the country.
The Minister of Agriculture, Dr Afriyie Akoto addressed the conference and stressed the need for the participants to use the platform to discuss how cocoa prices should be determined and how farmers could benefit from the entire value chain.