Ghana’s government has announced a significant 45% increase in the producer price of cocoa for the 2024/2025 crop season, aiming to deter smuggling and enhance the welfare of cocoa farmers.
Agriculture Minister Bryan Acheampong revealed on Wednesday that the new price will see the cost for a 64-kilogram bag of cocoa beans rise to $192 from $132. This adjustment brings the farm gate price to $3,063 per tonne, marking a 129% increase from the 2023/2024 season’s opening price of $1,335 per tonne.
“This is an unprecedented increase of 129.36%,” Acheampong stated, highlighting the government’s commitment to improving the cocoa sector and the livelihoods of Ghanaian farmers.
This price hike follows a mid-season adjustment last year, when the government raised the price from $1,335 per tonne to $2,113 per tonne in response to surging international cocoa prices.
Recent spikes in New York cocoa futures, which have risen above $7,000 per tonne due to poor harvests in Ghana and Ivory Coast, the world’s leading producers, have underscored the discrepancy between global prices and what farmers receive.
Experts believe that increasing the farm gate price may reduce the incentive for illegal cross-border sales, encouraging farmers to reinvest in their farms and potentially alleviating the global supply shortfall.
Ghana’s cocoa sector, crucial to the nation’s economy and accounting for about 10% of GDP, has faced challenges including declining harvests due to weather, disease, inadequate inputs, and smuggling. The sector heavily relies on smallholder farmers, who have been squeezed by the depreciation of the cedi, soaring production costs, and poor infrastructure.
Additionally, the Cocoa Swollen Shoot Virus Disease has severely impacted nearly 500,000 hectares of cocoa farms, representing about 29% of Ghana’s cocoa production area.