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Ghana seeks national dialogue over cocoa pricing quandary
                 Source: Xinhua | 2018-02-02 15:03:17 | Editor: huaxia

Visitors view cocoa beans at an exhibition stand during the Ghana Cocoa Festival in Accra, capital of Ghana, on Sept. 28, 2013. (Xinhua/Seth Gafah)

ACCRA, Feb. 2 (Xinhua) -- There is the gradual convergence of opinions on the need for a national dialogue over the producer price of cocoa Ghana pays its farmers in the face of dipping global prices.

Edward Kareweh, General Secretary of the General Agricultural Workers Union (GAWU) of Ghana Trades Union Congress (TUC), said such a national conversation should not only determine the pricing of the commodity in-country but also to redefine the role of cocoa in the country's economy in general.

Kareweh described as "great at the time" the decision by government to maintain prevailing prices when other cocoa producing countries had slashed their producer prices in line with the drop in world market price for the commodity.

"It showed our willingness to ensure that the farmers are not directly affected by the vagaries of the global arena," the trade unionist said in a telephone interview with Xinhua.

He was however of the belief that this was not going to be sustainable since if the prices continued to fall, then government would also have to change its stance

In spite of the fall in global prices, Kareweh admonished government not "to touch the current prices so as to inspire confidence in the cocoa farmers."

"However if government sees the dire need to review prices it should revert to the Producer Price Setting Committee which is made up of representatives of all major stakeholders to justify why this must be done," he urged.

Cocoa prices on the world market have dropped from a high of 2,287 US Dollars per metric ton around December 2016 to as low as the current price of 1,800 dollars per metric ton with Ghana still paying 7,600 Ghana cedis or 1,687 dollars per metric ton as producer price to farmers.

"The current world market prices are not going to stay the same forever and so all the investments government has been making into the industry should be considered on long-term basis since they are bound to yield the positive dividends once the prices begin to increase," Kareweh argued.

He urged for a diversified agricultural sector so that the impact price shocks from the world cocoa buyers on the economy can be minimized.

Cocoa pricing has over the years played a part in the political rhetorics in election years in Ghana as the two major parties New Patriotic Party (NPP) and National Democratic Congress (NDC) challenge each other as to which of them served best the interest of cocoa farmers.

"It is really a quandary: if you have cocoa prices from 2,900 dollars a ton and it is now down to 1,800 dollars per ton and you have pegged your producer price at 7,600 cedis, you have a problem. Can the country continue to subsidize that? " Minister for Finance Kenneth Ofori-Atta said.

Cocoa is Ghana's largest foreign exchange earner with the annual syndicated loan from foreign banks helping to cushion the local cedi currency against the major international currencies.

Since Cocoa pricing is such a fundamental question, the minister said there was the need for a national conversation where some real sober minds would have to think through how to liberalize the pricing regime.

Ofori-Atta could not confirm whether government intended to slush the producer prices any time soon.

Ghana and its western neighbor Cote d'Ivoire have established joint cooperation on cocoa with the aim of seeking to influence the direction of decisions of global stakeholders on the commodity, especially those which affect pricing of the commodity as the two countries account for more than 60 percent of total global output annually.

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Ghana seeks national dialogue over cocoa pricing quandary

Source: Xinhua 2018-02-02 15:03:17

Visitors view cocoa beans at an exhibition stand during the Ghana Cocoa Festival in Accra, capital of Ghana, on Sept. 28, 2013. (Xinhua/Seth Gafah)

ACCRA, Feb. 2 (Xinhua) -- There is the gradual convergence of opinions on the need for a national dialogue over the producer price of cocoa Ghana pays its farmers in the face of dipping global prices.

Edward Kareweh, General Secretary of the General Agricultural Workers Union (GAWU) of Ghana Trades Union Congress (TUC), said such a national conversation should not only determine the pricing of the commodity in-country but also to redefine the role of cocoa in the country's economy in general.

Kareweh described as "great at the time" the decision by government to maintain prevailing prices when other cocoa producing countries had slashed their producer prices in line with the drop in world market price for the commodity.

"It showed our willingness to ensure that the farmers are not directly affected by the vagaries of the global arena," the trade unionist said in a telephone interview with Xinhua.

He was however of the belief that this was not going to be sustainable since if the prices continued to fall, then government would also have to change its stance

In spite of the fall in global prices, Kareweh admonished government not "to touch the current prices so as to inspire confidence in the cocoa farmers."

"However if government sees the dire need to review prices it should revert to the Producer Price Setting Committee which is made up of representatives of all major stakeholders to justify why this must be done," he urged.

Cocoa prices on the world market have dropped from a high of 2,287 US Dollars per metric ton around December 2016 to as low as the current price of 1,800 dollars per metric ton with Ghana still paying 7,600 Ghana cedis or 1,687 dollars per metric ton as producer price to farmers.

"The current world market prices are not going to stay the same forever and so all the investments government has been making into the industry should be considered on long-term basis since they are bound to yield the positive dividends once the prices begin to increase," Kareweh argued.

He urged for a diversified agricultural sector so that the impact price shocks from the world cocoa buyers on the economy can be minimized.

Cocoa pricing has over the years played a part in the political rhetorics in election years in Ghana as the two major parties New Patriotic Party (NPP) and National Democratic Congress (NDC) challenge each other as to which of them served best the interest of cocoa farmers.

"It is really a quandary: if you have cocoa prices from 2,900 dollars a ton and it is now down to 1,800 dollars per ton and you have pegged your producer price at 7,600 cedis, you have a problem. Can the country continue to subsidize that? " Minister for Finance Kenneth Ofori-Atta said.

Cocoa is Ghana's largest foreign exchange earner with the annual syndicated loan from foreign banks helping to cushion the local cedi currency against the major international currencies.

Since Cocoa pricing is such a fundamental question, the minister said there was the need for a national conversation where some real sober minds would have to think through how to liberalize the pricing regime.

Ofori-Atta could not confirm whether government intended to slush the producer prices any time soon.

Ghana and its western neighbor Cote d'Ivoire have established joint cooperation on cocoa with the aim of seeking to influence the direction of decisions of global stakeholders on the commodity, especially those which affect pricing of the commodity as the two countries account for more than 60 percent of total global output annually.

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