New dawn for Ghanaian, Ivorian cocoa farmers

Côte d’Ivoire and Ghana – the world’s top two cocoa producers – have teamed up to impose a minimum floor price for Cocoa beans.

The two West African countries are working together to address the unfavorable global cocoa pricing regime to reduce the vulnerability of both nations to the volatility of the markets, Ghana’s President Nana Addo Dankwa Akufo-Addo said.

He described as “manifest injustice” the situation. For the 2015 crop season, the two countries earned for their output, which accounted for 65 per cent of the worlds cocoa production, only $5.75 million at a time when the global market was worth some $100 billion, he recalled.

The two countries had earlier proposed a floor price of $2,600 per ton against the International Cocoa Organization’s price that is averaging $2,436.

Ghana and Côte d’Ivoire who account for 65% of global cocoa supplies, argue that the current pricing structure that makes cocoa producers price takers does not reflect their contribution to the sustenance of the cocoa industry.

Cocoa output is determined by the individual decisions of millions of small farmers, decisions that are heavily influenced by bean prices.

Simply raising farmers’ cocoa earnings would spur production, likely at the cost of increased deforestation. Ivorian output has already doubled to over 2 million tons since 2000, according to Reuters.