Dr Owusu Afriyie Akoto (middle) delivering the addressing the media
The Government has announced that it will maintain the producer price of cocoa for the 2017/2018 crop season despite the sharp decline in the price of cocoa on the world market.
The price of a tonne of cocoa on the world market has witnessed a dramatic decline from about $3,000 to about $1,900, a 10-year low.
Food and Agriculture Minister, Dr. Owusu Afriyie Akoto, told stakeholders at a meeting organised by the Producer Price Review Committee on Friday in Accra that the cocoa price for 2017/2018 will still be GH¢7,600 per tonne.
He said this was equivalent to GH¢475 per bag of 64 kg gross weight.
“LBCs are to take note of this, and pay our cherished farmers accordingly, i.e. GH¢475 per bag of 64kg gross weight. This takes effect from Friday, 3rd October, 2017,” he said.
The decision to maintain the price is a hard one, and analysts believe there is the need for government to at least adjust the price a little upwards.
The Minister insisted that government shall not increase the price because it has the mandate to protect local cocoa farmers.
“Government is doing this to eliminate the harsh effects of the drastic decline in international cocoa prices on the earnings of our hardworking cocoa farmers,” Dr. Afriyie said.
“The huge drop in the world price of cocoa has reduced revenues to an extent that the Stabilization Fund is not enough to cushion farmers and other stakeholders in the domestic value chain. Therefore, government has sacrificed its share of FOB i.e export duty in order to keep the producer price at GH¢7,600 per tonne,” he said.
Ghana is accordingly losing $1.1 billion annually due to the drop in the prices
This, according to him, is “quite substantial” for a small economy like Ghana.
Meeting
In order to control such situations in the future, the Minister said that President of Cote d’Ivoire, Alassane Ouattara would be meeting President Akufo-Addo this week in Accra to find out how the two nations, which control more than half of the cocoa production market, can find ways of controlling the international market price.
He used the opportunity to also highlight the government’s commitment to increasing the productivity of cocoa farms and the efficiency of the operations of COCOBOD.
He noted that the government was introducing hand (artificial) pollination, as well as small-scale irrigation in cocoa.
“Government is introducing Hand (artificial) Pollination, as well as small-scale irrigation in cocoa. Government is also supporting the free pests and diseases control (mass spraying), and subsidized fertilizer application programmes for cocoa farmers to increase the productivity of cocoa farms.”
By Melvin Tarlue & Akpene Darko – Cobbina