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Ghana government considers slashing cocoa prices as slump continues
Ghana would prefer to pay farmers the equivalent of 70 percent of freight-on-board prices
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Ghana, the second largest grower of cocoa in the world has maintained a minimum price of $1,914 per metric tonne since 2016 even though its neighbour and world leader Cote d’Ivoire, has cut prices to $1,247.
According to Bloomberg, the country’s Finance Minister, Ken Ofori-Atta is worried by the current trend of cocoa in the world market .
"Cocoa is a problem. Ghana needs “to have a discussion at cabinet level and put out a formula that is similar to that of Ivory Coast.”
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Since last year Ghana has maintained its price at $1,914 per tonne. This development, experts say creates pricing gap of more than $700 per tonne.
Ghana, the world’s number two cocoa grower, maintained its price throughout the last season and has hinted that it will keep it unchanged or even raise it in 2017/18.
On the other hand, Ivory Coast is set to lower its prices for farmers at 700 CFA francs ($1.27) per kilogram for the 2017/18 main crop season.
This would open a significant price gap with Ivory Coast, raising the risk of large-scale smuggling of Ivorian beans into Ghana.
Ghana closed its 2016/17 crop year on Sept. 14 with output expected to total around 950,000 tonnes, the highest since a record 1 million tonnes in 2010/11.
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