At a gathering at Tepa, in the Ashanti Region, President Nana Akufo-Addo on Saturday declared GH1,308 as the new producer price per bag of cocoa.
At the event, President Akufo-Addo said that until recently, cocoa prices had remained extremely low and had even declined due to COVID-19.
Despite this, he continued, COCOBOD and the government have been making the extremely difficult choice to raise the producer price of cocoa.
The President said that government, in keeping with its promise to cocoa farmers, has increased the producer price. He acknowledged that the sustainability of the entire cocoa industry depends on a well-paid producer who is willing to invest in business only with the certainty that government will pay the appropriate price.
The government has “increased cocoa prices from GH12,800 per ton to GH20,943 per ton, or GH1,308 per bag,” according to President Akufo-Addo.
“That price is seventy-point-five percent (70.5%) of the Gross FoB price, and is equivalent to $1,821 per ton.”
This, the President indicated,” is the highest price to be paid to cocoa farmers across West Africa in some 50 years.
In the years to come, the government will continue to reward our farmers with favorable payments thanks to the consistent prices that are anticipated above the $2,600 mark. Yes, better times are coming.
President Akufo-Addo remarked that the productivity enhancement programs being carried out by COCOBOD are having a beneficial impact on productivity, earnings, and climate resilience. He described the cocoa landscape as going through an unparalleled shift under his administration.
The program, which involves a one-time payment of compensation to both the landowner and the tenant farmer, involves cutting, treating, and replanting the affected farm as well as the maintenance of the farm for a period of two years before it is turned over to the farmer, the President said. COCOBOD continues to perform the rehabilitation of diseased farms free of charge through the program, he added.
“In addition to the payment of compensation of GH¢1000 per hectare, paid separately to both land owner and tenant, COCOBOD bears the entire cost of the cutting, treating, replanting and maintenance for two years before it is handed over to the farmer.
“Compensation paid to both landlords and farmers stands at GH¢112,686,040 as of September 2022,” he said.
The President mentioned that the newly implemented Three-Tier Pension Scheme for cocoa growers includes a Contributory Scheme from COCOBOD. Enrollment has begun and will continue, making room for farmer and COCOBOD contributions in the upcoming season.
According to him, COCOBOD anticipates contributing about GH74.5 million to the fund this year.
“The Scheme will enable cocoa farmers also to save towards their retirement, so as to guarantee income security, improved living standards in their old age, and motivate the youth to venture into cocoa farming,” he stated.
The President Akufo-Addo continued, “This is the first successful attempt to give effect to section 26(1) of the Ghana Cocoa Board Act, 1984, PNDCL 84, which provides for the setting up of the Scheme.
“This has been made possible because of the implementation of the cocoa management system, which has provided the needed data and digital foundation for the Scheme to be successful.”
Following the adoption and implementation of the Living Income Differential (LID), he claimed that cooperation between Ghana and Cote d’Ivoire in the cocoa business had already produced positive outcomes for the sector.
“The LID is an additional amount of four hundred United States dollars ($400) per ton on the price of cocoa, paid on every ton of cocoa purchased from Ghana and Cote d’Ivoire. The LID is paid fully to the farmers, as a cushion to adverse effects of low international prices of cocoa.
“The LID has increased the average farmers’ income by $700 per ton. It is the first successful attempt by producer countries to influence the incomes of cocoa farmers through an international pricing mechanism,” he added.
According to the President, the government has also implemented a digitalization program to digitize all sector operations, improve traceability, and manage the domestic supply chain effectively. This program makes use of a vast, integrated digital database that collects data on farms and farmers, including the physical attributes of farms and farmer households.
He stated that the industrialization drive “value addition in the cocoa industry has increased significantly, from 30% of annual output in 2016 to 48% in 2022. The target of processing 50% of the production locally is within immediate reach.”He stated, “The promotion of domestic consumption is also beginning to yield results. Domestic enterprises have emerged strongly under the 1D1F initiative for the processing and manufacturing of various cocoa-based products across the Districts.
“COCOBOD has taken a giant step to support small-scale and artisanal chocolate manufacturing with business-friendly guidelines that provide access to premium Ghanaian beans, even at the district level.”
Through such innovations, President Akufo-Addo stated that some 130,000 jobs have been created, reiterating that “Government will, through COCOBOD, continue to adopt innovations aimed at improving the welfare of the Ghanaian farmer through the implementation of productivity enhancement programmes and remunerative producer pricing.”