Ghana, the world’s second-largest cocoa producer, is grappling with significant challenges in its cocoa sector as purchases of the commodity continue to decline.
This downturn is affecting farmers’ livelihoods and raising concerns about the sustainability of the cocoa industry. Alarmingly, some farmers have resorted to selling their farmlands to illegal small-scale miners, further threatening the future of cocoa cultivation.
International buyers are increasingly turning away from Ghana’s cocoa, citing higher prices compared to beans from other producing countries.
GhanaWeb Business highlights the key challenges faced by farmers and the factors driving this decline.
High prices
According to the Chief Executive Officer of the Ghana Cocoa Board (COCOBOD), Dr Randy Abbey, the challenge stems from Ghana’s pricing model, which guarantees farmers relatively high returns.
Currently, farmers are paid $5,040 per tonne, representing about 70% of the Free on Board (FOB) price. This pricing was set when global cocoa prices averaged around $7,200 per tonne.
However, market conditions have shifted, with prices now between $4,100 and $4,400 per tonne.
Meanwhile, Ghana’s total cost, including haulage, grading, warehousing, and shipping, stands at about $6,300 per tonne.
This has created a significant gap between Ghana’s cocoa and beans from competitors such as Côte d’Ivoire, Nigeria, Ecuador, and Brazil.
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Uncompetitive market
Rising costs have made Ghana’s cocoa less attractive internationally. Buyers often turn to cheaper alternatives, reducing demand for Ghanaian beans and weakening the country’s competitive edge.
Delayed payments to farmers
Farmers frequently face long waits before receiving payment for their produce. This delay erodes trust in the system and discourages farmers from selling to official channels, as they need immediate cash to support their families and daily needs.
Smuggling to neighboring countries
Frustrated by delays and pricing issues, many farmers smuggle cocoa across borders to Côte d’Ivoire, where they receive quicker payments and better prices. This practice reduces official purchase volumes in Ghana and undermines the sector’s stability.
Low motivation among farmers
With limited incentives, poor infrastructure, and inadequate support, many farmers feel demoralised. Some are shifting to other crops or abandoning cocoa farming altogether, further reducing production levels.
Give the power back to farmers – Franklin Cudjoe to COCOBOD.
Poor infrastructure
Inadequate rural roads and storage facilities increase post-harvest losses and discourage farmers from transporting beans to purchasing centers. This adds to inefficiencies in the supply chain.
Limited access to credit
Many farmers lack financial support to invest in fertilisers, pesticides, and modern farming techniques. Without access to credit, productivity remains low, making cocoa farming less profitable.
Policy and management challenges
Bureaucratic inefficiencies and inconsistent government interventions have weakened confidence in the sector’s long-term stability. Farmers and stakeholders are calling for reforms to restore trust and competitiveness.
Ghana risks losing its competitive edge in the global cocoa industry if urgent interventions are not implemented. Timely payments to farmers, improved infrastructure, and access to credit are critical to reviving the sector.
Without these measures, the decline threatens not only export revenues but also the livelihoods of millions who depend on cocoa farming.
SA/MA
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