PANAPRESS
Panafrican News Agency
Ghana's Cocobod sees US$200 mln financing deficit on price volatility - CEO
Accra, Ghana (PANA) - Ghana's cocoa industry regulator Cocobod will incur around one billion cedis (US$200 million) deficit in its 2018-19 season crop financing as the country is reluctant to cut farmer's prices despite global beans price volatility, chief executive Joseph Boahen Aidoo said.
The West African country operates a semi-liberalized internal cocoa marketing system where private buyers are licensed to purchase beans from farmers and submit to Cocobod for export, mainly to Europe. It currently pays farmers 7,600 cedis per tonne of cocoa (US$1,520). New York cocoa futures closed Wednesday around US$2,251.
"Market prices are still well below what we pay our farmers and we estimate that there will be a financing gap of about 1 billion cedis this season because of the low prices," Aidoo told PANA on the sidelines of a stakeholders' meeting in Accra on Wednesday night. He dismissed suggestions that Cocobod had become a loss-making entity.
Ghana has been reluctant to cut producer prices despite a sharp drop in world prices last year, resulting in a financing gap of around US$400 million. Aidoo said Cocobod issued bills, sometimes at high interest rates, through Bank of Ghana to make up for the shortfall.
"It is a sensitive industry but for now our priority is to restore the appeal of cocoa farming by providing incentives to boost farmers' income," Aidoo said.
In addition to a US$1.3 billion syndicated loan Cocobod signed with international lenders in Amsterdam last Sept., it is also in talks with the banks to raise a US$300 million medium-term facility to offset high interest payments, Aidoo said.
Ghana, the world's second largest beans exporter after Cote d'Ivoire, aims to produce around 900,000 tonnes of cocoa in the 2018/19 season which ends in Sept. "We are on course and we would be able to meet our target," Aidoo said. He declined comments on suggestions that Ghana's cumulative output could exceed one million tonnes this crop year.
However, he said Ghana was piloting a scheme to increase output from a yearly average of 800,000 tonnes currently to above 1 million in the medium term through efficient farming techniques, including motorized pruning, hand pollination and enhanced disease control systems.
Aidoo said the pilot programme, which targets 100,000 farmers, had begun to show significant increase in farm productivity. "For the first time, farmers are registering 20 bags or more per acre, compared to three bags currently and we are hopeful this will lead to a significant boost in yield above the one million mark when fully rolled out."
Ghana also plans to increase locally processed cocoa to 50 percent of yearly output, from 34 percent currently, Aidoo said.
-0- PANA KK/MA 31Jan2019
The West African country operates a semi-liberalized internal cocoa marketing system where private buyers are licensed to purchase beans from farmers and submit to Cocobod for export, mainly to Europe. It currently pays farmers 7,600 cedis per tonne of cocoa (US$1,520). New York cocoa futures closed Wednesday around US$2,251.
"Market prices are still well below what we pay our farmers and we estimate that there will be a financing gap of about 1 billion cedis this season because of the low prices," Aidoo told PANA on the sidelines of a stakeholders' meeting in Accra on Wednesday night. He dismissed suggestions that Cocobod had become a loss-making entity.
Ghana has been reluctant to cut producer prices despite a sharp drop in world prices last year, resulting in a financing gap of around US$400 million. Aidoo said Cocobod issued bills, sometimes at high interest rates, through Bank of Ghana to make up for the shortfall.
"It is a sensitive industry but for now our priority is to restore the appeal of cocoa farming by providing incentives to boost farmers' income," Aidoo said.
In addition to a US$1.3 billion syndicated loan Cocobod signed with international lenders in Amsterdam last Sept., it is also in talks with the banks to raise a US$300 million medium-term facility to offset high interest payments, Aidoo said.
Ghana, the world's second largest beans exporter after Cote d'Ivoire, aims to produce around 900,000 tonnes of cocoa in the 2018/19 season which ends in Sept. "We are on course and we would be able to meet our target," Aidoo said. He declined comments on suggestions that Ghana's cumulative output could exceed one million tonnes this crop year.
However, he said Ghana was piloting a scheme to increase output from a yearly average of 800,000 tonnes currently to above 1 million in the medium term through efficient farming techniques, including motorized pruning, hand pollination and enhanced disease control systems.
Aidoo said the pilot programme, which targets 100,000 farmers, had begun to show significant increase in farm productivity. "For the first time, farmers are registering 20 bags or more per acre, compared to three bags currently and we are hopeful this will lead to a significant boost in yield above the one million mark when fully rolled out."
Ghana also plans to increase locally processed cocoa to 50 percent of yearly output, from 34 percent currently, Aidoo said.
-0- PANA KK/MA 31Jan2019
