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The Ghana Civil Society Cocoa Platform (GCCP) welcomes the government’s efforts to ensure that cocoa farmers earn a decent income. We have followed various measures taken by the government and its Ivory Coast counterpart that resulted in a massive change in the price of cocoa beans, following the introduction of a floor price and a Digital Income Differential (LID) that they must pay. chocolate and processing companies.
The recent announcement of the payment of GHS 660 per 64 kilogram bag of cocoa, which translates to GHS 10,560 per tonne of 16 bags for the 2020/21 crop year, which begins on October 1, 2020, is a huge milestone and a sample of COCOBOD’s commitment. to grant cocoa farmers the full LID of four hundred US dollars per metric ton (US $ 400 / MT).
On September 24, 2020, the GCCP issued a statement indicating our expectation of an increase in the farm’s starting price that was scheduled to be announced on October 1, 2020. Although not what we requested, the The recent announcement of GHS 660 per 64 kilogram bag (increase of around 28% over the price obtained in the 2019/2020 crop season that has just ended) of cocoa is not far from our expectations.
Based on the working assumption of the COCOBOD Producer Price Review Committee (PPRC), which aims to ensure that the farm price is set at a minimum of 70% of the net free-on-board (FoB) price of the cocoa beans, GCCP was of the opinion that Ghanaian farmers receive a minimum of 672.6 GHS per bag (64 kg) of cocoa beans. This figure was arrived at using the lowest available projected values, including 80% of the $ 400 per ton LID announced in July 2019.
The current price of GHS660 per bag of cocoa beans is commendable, considering that the Ghana Cocoa Board together with its pricing committee (Producer Price Review Committee – PPRC) appears to have offered the entire $ 400 LID to farmers as agreed with chocolate and processing companies. . This is remarkable as it will protect farmers amid the coronavirus pandemic. However, this also raises questions about what percentage of the FOB price of cocoa was offered to farmers and at what exchange rate.
Based on our internal projections, it appears that farmers received only 68% of the FOB price at an exchange rate of $ 1: GH5.5, which falls below the PPRC threshold of 70% and well below the current year of the Bank of Ghana at the annual exchange rate. by GH5.7. This also raises another transparency problem when publishing the indicative figures that are used to decide the price of cocoa annually.
In congratulating COCOBOD on this milestone, we also wish to point out the following:
COCOBOD must strengthen its vigilance in order to reduce all factors that may prevent the farmer from fully appreciating the LID. We specifically suggest that intensive monitoring be carried out in various cacao warehouses and sheds, as well as awareness of farmers on how to escape scale adjustment fraud by purchasing employees (PC), as reported in a SEND study GHANA of 2019.
Importantly, the COCOBOD sanctions identified the PCs who were captured in the Joy News documentary “Missing Kilos” in August this year as a deterrent to others, as we await the implementation of electronic scales next year.
COCOBOD must ensure that the various productivity improvement programs benefit all farmers. The input distribution program, including fertilizers and mass spraying, must, among others, be distributed equitably and therefore particularly ensure that female farmers benefit equally from 2019 The SEND GHANA study also revealed the highest probability of exclusion of women farmers both from the fertilizer input and from the massive fumigation program.
COCOBOD must also ensure that farmers whose ailing and aging farms are being rehabilitated receive adequate compensation to motivate others to participate in the program.
We strongly believe that when all of these factors are properly addressed and implemented, they will further improve farmers’ incomes and livelihoods, as anticipated by this price increase.
About the Ghana Civil Society Cocoa Platform (GCCP):
The Ghana Civil Society Cocoa Platform (GCCP) is an independent campaign and advocacy platform for civil society actors in the cocoa sector, comprising civil society organizations, non-governmental organizations, community-based organizations , farmers ‘organizations, farmers’ associations, the media and interested persons. The main objective of the platform is to promote and influence the policies and programs of the cocoa sector. GCCP is currently being hosted by SEND Ghana, with members across the country, especially in cocoa growing areas.
