Declining Cocoa Prices Cost Ghana $1bn Annually

Ghana is losing at least one billion dollars every year from the declining prices of cocoa on the international market.

The development is also said to be impacting on projected revenue from the cash crop to improve operations in the sub-sector.

This notwithstanding, the government has maintained the producer price of cocoa for farmers.

Checks by Citi Business News have shown that, the price of a tonne of cocoa on the international market is presently estimated at 2000 dollars. 

This is a marked drop from the figures recorded around the same period in 2016.

Also, data from the Bank of Ghana has shown that between August 2016 and August 2017, the price of cocoa on the international market, dropped from $ 2,993.5 to $ 1,947.6 per tonne.

This represents a 35 percent drop in the international price of the cash crop.

As a result, cocoa recorded the least growth in export revenue of about 16 percent; between the one year period.

Revenue from the commodity amounted to 1.99 billion dollars in August 2017, from the 1.72 dollars in August 2016.

At a media briefing to announce the producer price for cocoa on Friday, October 13, Agric Minister, Dr. Owusu Afriyie Akoto, lamented the impact of the declining prices.

“As a result, this country is losing about 1.1 billion US dollars a year, which is quite substantial for a small economy like Ghana… it’s a real shock,” he stated.

Cocoa’s contribution to GDP rises

Meanwhile, the 2017 second quarter GDP figures released by the Ghana Statistical Service show that, the cocoa sub-sector grew by 15.6%.

The sector’s contribution to GDP went up from 64 million cedis in the second of 2016, to 74 million cedis in the same period this year.

Gov’t maintains cocoa prices

But government has maintained the producer price of cocoa for farmers for the 2017/2018 crop season at 7600 cedis per metric tonne.

This translates into 475 cedis per bag of 64 kilograms.

“The price of cocoa on the international market has witnessed a dramatic decline to a ten year low from more than $3000 per tonne only 10 months ago to as low as $1900 in recent months. The situation has compelled other countries to reduce drastically their producer prices of cocoa,” Dr. Owusu Afriyie Akoto said.

Source: citifmonline.com