Ghana and Ivory Coast on Wednesday announced that they had won concessions from stakeholders in the cocoa industry, including acceptance of a $2,600 floor price for a tonne of cocoa.
The two nations had threatened to stop selling their products to buyers unwilling to meet a minimum price.
Following a two-day meeting called by the two top cocoa producers who together account for over 60% of the world’s production, Joseph Boahen Aidoo, chief executive of the Ghana Cocoa Board, told a news conference that their demands had been accepted in principle by the participants.
“Ivory Coast and Ghana have suspended the sale of the 2020/2021 crop until further notice for preparation of the implementation of the floor price,” he said.
Calling the move “historic”, he said that “this is the first time when the producers have called consumers and the first time whereby suppliers have called buyers to come and engage on price,” he said.
“Over the years, it has been the buyers who have determined the price for the suppliers.”
Aidoo added that there would be a follow-up meeting to work out how to implement the agreement.
The world’s chocolate market is worth around $100 billion, of which only $6 billion go to cocoa producers.
Ghana, Ivory Coast suspend sales
Ghana and Ivory Coast, who are the world’s top two cocoa growers on Tuesday suspended the sale of cocoa beans to the open market under the 2020/2021 crop season until further notice.
The suspension, announced to stakeholders in the cocoa value chain, including traders, processors, and chocolate manufacturers, is part of efforts by the two countries to get a fair price for farmers, according to a news channel, Graphic Online.
The two countries had earlier proposed a floor price of $2,600 for every tonne against the International Cocoa Organisation’s price that is averaging $2,436.
Ghana and Ivory Coast who account for 65% of global cocoa supplies, argue that the current pricing structure that makes cocoa producers price takers does not reflect their contribution to the sustenance of the cocoa industry.
A formal decision on the floor price is expected on Wednesday, as the two producers take on almost 300 representatives of stakeholders in the cocoa value chain, by categorically agreeing that neither Ivory Coast nor Ghana will sell their produce in the international market below the agreed minimum price.
Zimbabweans lament after price of bread rises by 60% overnight
Bakers said they were forced to hike their prices due to rising production costs
The price of bread shot up 60 per cent overnight in Zimbabwe, in the latest blow for a population already struggling with spiralling living costs.
Zimbabweans can barely keep pace with the price rises that have rekindled fears of hyperinflation which reached 500 billion per cent a decade ago and forced the country to trash its own currency.
Already, many families live on one meal a day, with the country in the grip of a major downturn that has provoked biting shortages of basics such as fuel and medicine.
Bakers said they were forced to hike their prices due to rising production costs.
Electricity prices have “gone up significantly, the price of fuel has also been going up weekly, the prices of raw materials have also gone up including the cost of importing wheat,” said Dennis Wala, the president of the National Bakers’ Association.
Electricity is only available for around six hours a day, forcing many bakers to use generators to run their ovens.
“The bread manufacturer is at the end of the value chain and we have to factor in all these costs, but we don’t prescribe prices to our members,” Wala told reporters.
The price of a loaf of bread soared to 15 Zimbabwe dollars (around US$1) on Wednesday from nine dollars the previous day, according to a correspondent.
Bread is the second most important staple in the country after a thick cornmeal porridge known in the local Shona language as “sadza”.
After decades of mismanagement under former President Robert Mugabe, Zimbabwe reached absurd levels of hyperinflation in 2008-2009 when the central bank started printing money.
Mugabe’s successor, Emmerson Mnangagwa has failed to stop the latest inflation surge, last week begging for patience to bring the economy back from the “dead”.
But the economy is near breaking point.
Hundreds of thousands of government workers said this week they could no longer afford to report for duty as their wages had been rendered almost worthless.
Last week, the authorities quadrupled the price of electricity — which is already in short supply after a 400 per cent hike in August.
Earlier this month, the price of fuel rose more than 25 per cent, the latest in series of regular increases.
The official inflation rate was 290 per cent last month, but economists estimate it is at least double that figure.
Nigeria to sign military cooperation deal with Russia
Nigerian President, Muhammadu Buhari is due to meet Putin on the sidelines of a Russia-Africa summit in Sochi
Nigerian President, Muhammadu Buhari hopes to sign a military-technical cooperation deal with Russia at talks with President Vladimir Putin this month that will help it fight Boko Haram militants.
The Nigerian leader is due to meet Putin on the sidelines of a Russia-Africa summit in the Black Sea city of Sochi amid a push by Moscow to expand its influence in Africa.
“We’re sure that with Russian help we’ll manage to crush Boko Haram, given Russia’s experience combating Islamic State in Syria,” Nigerian envoy, Steve Ugbah said in an interview with Russia’s RIA news agency, adding that Nigeria was interested in purchasing Russian helicopters, planes, tanks and other military equipment.
Ugbah says a military-technical cooperation deal between Russia and Nigeria had already been drafted and that it is awaiting finalisation.
“We hope President Buhari can take the talks to their logical end. The agreement will open new possibilities in such areas as the supply of military equipment and training for specialists,” he adds.
Nigeria, Cameroon to plan Cocoa price cartel
The plan suggested by Nigeria is part of a trend by cocoa growers in West Africa and Latin America
Nigeria aims to team up with Cameroon to agree on a premium for its cocoa with buyers, after the world’s top growers, Ivory Coast and Ghana set a price floor for the crop.
The plan suggested by Nigeria, the world’s fourth-largest cocoa producer, is part of a trend which has seen growers in West Africa and Latin America seek to influence prices in the global market.
The move follows Ghana and Ivory Coast’s union in July, which set the price for a ton of cocoa from their countries at $2,600 plus a $400 premium described as “living income differential”.
Both countries produced 60 per cent of the world’s cocoa in 2018.
Vice President of the World Cocoa Producers Organisation, Sayina Riman says discussions will be held with the private sector and the Nigerian Government before formal talks are held with Cameroon.
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