Farmer-backed CSO Calls for Over 70% Raise in Cocoa Price

The Ghana Civil-society Cocoa Platform (GCCP) has proposed a minimum farm gate price of GH₵3,583 per 64-kilogram bag of cocoa beans for the upcoming 2024/2025 season against its current GH¢2,070, an estimated increase of 73.1%

According to the advocacy organisation, this proposal is based on conservative estimates and prevailing global market conditions, which suggest a significant increase in cocoa prices.

Addressing journalists at a press conference in Accra, GCCP Co-Coordinator, Obed Owusu-Addai, said the farmer group is anticipating a 65-70% rise in the farm-gate price of cocoa, noting that most contracts for the upcoming harvest were established using the 2023/2024 market prices, which averaged approximately $6,104.33 per tonne.

“The farmers should receive at least 60% of the gross free-on-board (FoB) price, leading to a proposed minimum farm-gate price of $3,662.60 per tonne.

Using an exchange rate of $1 to GH₵15.65, the minimum farm-gate price per tonne translates to a figure not less than GH₵57,320. This figure reinforces the proposed price of GH₵3,583 per bag,” he said.

Despite the government’s consistent efforts to adjust farm-gate prices upward over the years, Obed Owusu-Addai highlighted systemic issues within cocoa marketing, stating that “problems such as forward sales of beans and inflated administrative costs at COCOBOD have hindered farmers from fully benefiting from their labour. The association is calling reforms to ensure that cocoa farmers receive fair compensation for their hard work.”

He said the farmer group’s agitation for the price increase is that Ghana faces its lowest cocoa output in over twenty years, projected to be slightly above 500,000 metric tonnes—comparable only to the 2002/2003 season.

Despite a global decline in cocoa production during the 2023/2024 season, the international market has seen a remarkable surge, reaching a record high of $12,261 per tonne in April 2024.

Obed Owusu-Addai however, alleged that Ghanaian farmers have not reaped the benefits of these price increases due to the Ghana Cocoa Board’s longstanding marketing strategy, which prioritizes forward sales over spot sales, “this approach has limited farmers’ ability to capitalize on favourable market conditions”.

He added, “as the cocoa season transitions to 2024/2025, anticipation grows for the announcement of new farm-gate prices in September 2024. The leadership of GCCP is seizing this opportunity to reflect on the previous season and articulate expectations for the forthcoming price adjustments.”

“We are advocating for a pricing strategy that more directly benefits farmers, ensuring they receive fair compensation that reflects both local production realities and global market trends.”

Pricing Strategies

In a bid to ensure fair compensation for Ghanaian cocoa farmers, Obed Owusu-Addai advocated for the realignment of pricing strategies and support systems.

He emphasises the need for upward mid-term revisions of farm-gate prices, citing the volatile nature of the national currency and the ongoing issue of cross-border cocoa smuggling.

He also argues that such measures are essential to keep farmers motivated and competitive within the sub-region.

“By institutionalising these price adjustments, the government can provide a more stable and supportive environment for cocoa producers, ultimately benefiting the entire industry.”