According to two people with knowledge of the pricing review who spoke to Reuters, the government would raise the state-guaranteed price it pays to its cocoa growers by over 45% for the 2024–2025 crop season.
The sources claim that this is intended to increase their earnings and discourage the smuggling of beans out of the nation.
For the remainder of the 2023–24 season, the second-largest cocoa producer in the world increased the farmgate price by over 58% in April, to ¢33,120 ($2,123.08) per metric ton, or ¢2,070 per 64 kilograms (kg).
The neighboring Ivory Coast, a leading producer of cocoa, increased its farmgate price for the April to September mid-crop of the 2023–24 season to 1,500 CFA francs (US$2.55), or about ¢40 per kg, causing a mid-season price jump. The previous season’s price was set at 1,000 CFA francs.
According to a source, the price for the 2024–25 season, which is expected to start later in September, has been set by Ghana’s cocoa producer price review committee at 48,000 cedi per ton, or ¢3,000 for every 64 kg of cocoa. This represents a rise of about 45%.
According to the source, the cabinet would be consulted before making a statement on the decision.
The decision has not yet been made public, thus both sources requested to remain anonymous.
The second source stated that it was improbable that the government would overturn the committee’s ruling and that raising the price above ¢48,000 per ton would force Ghana’s cocoa marketing body, Cocobod, into a deficit.
According to the source, Ghana’s pricing will also need to match the farmgate price for Ivory Coast in 2024–2025—which has not yet been revealed.
To support the industry and increase farmer incomes, the two largest cocoa-growing nations launched an initiative to coordinate cocoa supplies and farmgate prices.
Since disease and unfavorable weather in Ghana and Ivory Coast—two countries that together produce over 60% of the world’s cocoa—pushed the market to a third consecutive deficit, cocoa prices have been strong this year.
The market is expected to reach a 45-year low in the stocks-to-grindings ratio, according to the International Cocoa Organization, which increased its prediction for the worldwide cocoa deficit for the 2023–2024 season (October–September) to 462,000 tons from 439,000 tons on Thursday.
With a lower output target of 650,000 tons, Cocobod had originally intended to open the 2024–25 season on September 1st, earlier than usual. However, according to both sources, the opening will take place later.
The goal of early season opening was to lessen the incentive for bean smuggling, which has been fueled by poor prices and unpaid farmers.
A number of licensed buyers and cocoa farmers in Ghana have accused both parties of hoarding beans in order to profit from the projected price increase for the upcoming season.