Ghana and its western neighbour, Cote d’Ivoire, jointly account for two-thirds of the global supply of cocoa.
Although renowned as the largest producers of cocoa beans in the world, the top ranking does not equal their earnings.
With the global cocoa industry estimated at $130 billion per annum, the duo have only a 6% share between them.
Thus the West African cocoa giants are merely price takers; they have no influence at all on the price their prized produce attract on the London and New York futures market.
A collaborative effort to have a little addition to the sorry prices cocoa farmers receive for their produce culminated in the $400 per tonne Living Income Differential (LID) price system in 2019.
But implementation would soon hit a stonewall. Some chocolate manufacturers initially circumvented payment of the LID.
And also cocoa buyers have succeeded in neutralising the effect of the LID by discounting country origin premiums traditionally paid to the two countries for the quality of their cocoa beans.
The present situation is, indeed, biting Ghana and Cote d’Ivoire who still export the bulk of their cocoa produce in its raw state.
As an antidote to this economic trap, both countries have in the last decade or two pursued an agenda to process a significant proportion of annual crop in country.
In the 2019/20 cocoa year, Côte d’Ivoire accounted for a 14 percent share of global processing while Ghana was responsible for 29 percent.
To achieve this, for instance, Ghana continues to pay the price of doling out juicy tax incentives and other freebies to multinational processors in a special economic zone.
In exchange, a few hundreds of mainly low-skilled jobs are thrown at the country’s unemployed labour pool.
Despite the government’s intention to command more revenue for its cocoa through value addition, industry regulations and policies have indirectly excluded indigenous investors.
To begin with, local entrepreneurs in the artisanal cocoa value addition space have virtually no access to cocoa beans as they are inhibited by a minimum purchase threshold fifty (50) metric tonnes.
This means small scale batch chocolate manufacturers, like Accra-based Kamini Chocolates with a staff of less than ten, must buy at least 800 units of 64kg bags of cocoa beans at the current unit price of GHS660 per bag.
The alternative is to purchase semi-processed cocoa products (liquor, powder, butter or couverture) in smaller quantities from the large scale cocoa processors. But that’s where other barriers to local value addition efforts come to play.
Noah Amenyah, a retired public servant and now a cocoa value addition enterpreneur, sums up the frustration players in the sub-industry are confronted with.
“We are talking about
The range of local value added cocoa products they manufacture include chocolate bars, cosmetics, confectionery, cocoa wine
challenge to local cocoa value addition artisans or entrepreneurs.
On the fourth floor of Vivo Place, located in plush Cantonments suburb of Accra, houses the head office of the Ghana Investment Promotion Centre (GIPC).
In the conference hall of the Ghana Investment Promotion Centre’s head office
For the first time, an inter-agency technical committee is set to collectively find pragmatic ways to undo inhibitions to the emergence and expansion of Ghana’s artisanal cocoa value addition subsector.
Small-scale cocoa processing and value addition are deemed to hold the keys to untapped jobs and wealth creation opportunities in the world’s second-largest cocoa producer nation.
But existing regulatory and investment laws technically proscribe indigenous micro and small enterprises from participation.
The hurdles notwithstanding, the West African country has in the last decade seen the organic emergence of a handful of entrepreneurs
