In a move to support cocoa farmers and combat smuggling, the Ghanaian government has announced a 45% increase in the guaranteed price paid to cocoa farmers for the 2024/25 season. The decision, pending cabinet approval, will raise the farmgate price from 33,120 cedis per metric ton to 48,000 cedis ($3,070) per metric ton.
"This appreciable increment in the producer price of cocoa signifies the government's commitment to improve the sector and the livelihoods of the Ghanaian cocoa farmer," said Agriculture Minister Bryan Acheampong.
The price hike comes after a mid-season adjustment in April 2024, which saw prices increase by over 58% to 33,120 cedis per metric ton. The decision aligns with Ivory Coast's yet-to-be-announced 2024/25 price, as both nations have established a joint initiative to coordinate cocoa prices and supplies.
Experts suggest that increasing the farmgate price could lower the incentive for illegal cross-border sales, allowing farmers to reinvest in their cocoa farms and potentially ease the global supply shortfall. Ghana's cocoa harvest has declined in recent years due to weather challenges, disease, inadequate inputs, and smuggling.
The 45% price increase is expected to boost farmer incomes and combat bean smuggling, which has been a significant threat to Ghana's cocoa industry. Smuggling has resulted in an estimated $400 million in annual revenue losses for Ghana, with up to 30% of the country's cocoa beans being trafficked out of the nation.
By tackling this issue and supporting its cocoa farmers, Ghana aims to maintain its position as the world's second-largest cocoa producer and ensure the long-term viability of its cocoa industry.