Pods ready for harvest
News of the decline of Ivorian cocoa production might be premature. I have reported earlier that a consensus estimate put Ivorian output for the current cocoa year at 1-1.15 million tons, quite a bit below the 1.4 million tons the country had achieved only a few years ago. But that consensus is no longer holding.
The Ivorian President Gbagbo’s two-day visit to Ghana ended with a joint communique expressing the two countries’ resolve to influence international cocoa prices. The communique pointed out that increases in production have not yielded comparative increases in revenue for the countries. It further criticized the impact of global commodity cartels on cocoa prices. Finally, Gbagbo and Ghanaian President Mills reaffirmed their support for moving the headquarters of the International Cocoa Organization (ICCO) from London to Abidjan.
Ghana’s Finance Minister Dr Kwabena Duffuor today announced the new cocoa producer price for the 2009-10 season. Farmers will receive GH¢2,208 ($1,511) per ton or GH¢138 ($94.50) per bag of cocoa. That’s a 35 percent increase over last year’s producer prices and about 71 percent of the FOB price of cocoa. With the current cocoa prices hovering around $3,300 per ton, I’m not sure how the 71 percent number was calculated. But the report indicated that the new price is the highest price ever paid to farmers.
Ghana defied expectations and increased production for the cocoa year that ended on September 30. Despite smuggling and initially low deliveries, total cocoa production reached 703,000 tons, according to a report by the Ghana Broadcasting Company. This is the first time that Ghana has surpassed 700,000 tons.
