In efforts to secure the price of cocoa and seek the development and welfare of cocoa farmers in Ghana and Côte d’Ivoire, a Stabilisation Fund is set to be established soon.
The Stabilisation Fund account will be under the Cocoa initiative of both countries and as provided in the Charter, two accounts will be set up for each country within the secretariat in Accra.
This was disclosed by the Chief Executive Officer (CEO) of the Ghana Cocoa Board, Mr. Joseph Boahen Aidoo at a press briefing in Accra.
Speaking further, he explained that, this is as a result of both country presidents in 2017 commissioned the Ghana Cocoa Board (COCOBOD) and Le Conseil due Café-Cacao (CCC) to strategize as well as ensure that, the incomes of farmers in the two major cocoa producing countries are improved.
“There have been several interactions and engagements which led to the 11th and 12th June,2919 Accra meeting with stakeholders”, adding the primary purpose of the Accra Stakeholders meeting was to agree on a floor price which will bring the two countries closer to achieving the important mandate of the two presidents.
Revealing that, an amount of $2,600 FOB, equivalent of $2,790 CIF peer tonne was agreed upon as the floor price of cocoa for the two countries which will take effect from the next cocoa season.
“It is instructive to note that, this new arrangement fixes a constant extra $400 for every tonne of cocoa from the two countries citing an example that, with the 900,000 metric tonnes of cocoa produced last year, it would have fetched about $360 million dollars from the upper level of the supply chain us here in Ghana at the lower level of the cocoa value chain”.
To achieve all these, Mr. Joseph Boahen Aidoo indicated that, a technical committee made up of a working group from Ghana, Côte d’Ivoire and representatives from the trade and industry was taksed to work out the processes for the smooth implementation of the agreed Floor Price mechanism.
After extensive delineation in Abidjan on the 3rd of July, 2019, he noted that, Ghana and Côte d’Ivoire decided to implement the floor price concept by agreeing on a fixed living income differential of $499 per tonne for every cocoa sold by both countries from 2020/21 season.
“With this announcement, every cocoa that will be sold from Ghana and Cote d’Ivoire from 2020/21 season will attract a fixed Living Income Differential (LID) of $400 which would be applied to call category of beans”, he acclaimed.
On the Stabilisation Fund, he stated that, the two countries further agreed that, farmers in both countries would be guaranteed a minimum price of 70% of the floor price $2,600 price FOB (2,700 CIF) per tonne adding this minimum producer price would be legislated in both countries.
“When the achieved average Gross FOB price at the end of the Cocoa Season is between the minimum price level of $2,600 (2,700 CIF) to $2,900 ($3,000 CIF), the farmer would be entitled to bonus payment”, acknowledged.
On the issue of disbursement of the fund, he stated that, the only manadate for the disbursement from these accounts will be for the sole purpose of supporting the Achieved Weighted Average if it falls below $2,300 CIF or $2,200 gross FOB.
The Chief Executive Officer (CEO) of COCOBOD, Mr. Joseph Boahen Aidoo therefore indicated that, they remain committed to the call by the President to ensure a better living condition for cocoa farmers and added that,they shall therefore not rest on their oars after this feat but will further pursue other programmes and initiatives for the betterment of farmers and the sustain ability of the industry.
Source: Ishmael Barfi