Over the past week, several sources reported that the Ghanian Cocoa Board (COCOBOD) released a second round of bonuses to cocoa farmers. According to the Joy Online, a total of GH¢16,035,161.35 (about $16.45 million) will be released to the Licensed Buying Companies for distribution to individual farmers. The amount translates to about GH¢1.71 ($1,75) per bag of cocoa. That does not seem much but for a country with an per capita income of $2,700 and many cocoa farmers making less than that, $1.75 per bag bonus makes a difference.
It is not clear, though, if that bonus is simply the high world market prices trickling down to the farmers. Much of the cocoa has already been sold in forward contracts and the current spot market prices apply to only a fraction of the cocoa sold. An more likely explanation is the election campaign going on in Ghana at the moment. The current president, John Kufuor, and the New Patriotic Party (NPP) came to power in 2004 and their term is up this December.