Dr. Samuel Ofosu-Ampofo
The Board Chairman of the Ghana Cocoa Board (COCOBOD), Dr. Samuel Ofosu-Ampofo, says the recent appreciation of the cedi, though positive for the broader economy, is adversely affecting the Board’s export earnings.
Speaking in an interview with Accra-based GHOne TV, Dr. Ofosu-Ampofo explained that cocoa exports are traded in United States dollars, and a stronger cedi significantly reduces the value of those proceeds when converted into local currency.
This, he said, places pressure on COCOBOD’s ability to meet its financial obligations across the cocoa value chain.
According to him, the reduced cedi value of cocoa export revenues affects payments to farmers, servicing of loans, and the day-to-day operations of the Board, including the procurement of essential inputs.
“The rising cedi has its own ramifications on COCOBOD because we sell our cocoa beans in dollars. When we convert those dollars into cedis, it is what we use to pay workers and suppliers, and to purchase insecticides, agrochemicals and fertilizers,” he noted.
Dr. Ofosu-Ampofo illustrated the challenge with a comparison of exchange rates over time. He explained that in December last year, when the dollar was trading at about ¢16 to ¢17, cocoa sold at $2,100 yielded significantly higher cedi returns.
However, with the dollar now around ¢10.5 to ¢11, the same quantity of cocoa generates far less revenue in local currency, despite unchanged dollar prices.
He acknowledged that the strengthening of the cedi is beneficial to the national economy but stressed that it presents unique difficulties for export-oriented institutions such as COCOBOD.
To cushion farmers against the impact, Dr. Ofosu-Ampofo said government has stepped in with direct support.
He disclosed that President John Dramani Mahama has directed COCOBOD to supply agrochemicals and fertilizers to cocoa farmers free of charge.
“For this year alone, about ¢5.8 billion has been invested in the purchase of agrochemicals for free distribution to farmers,” he revealed.
Dr. Ofosu-Ampofo appealed to cocoa farmers to continue supporting government initiatives aimed at transforming the sector, assuring them that measures are being put in place to sustain productivity despite the currency-related challenges facing COCOBOD.
A Business Desk Report