The New Patriotic Party (NPP) says the National Democratic Congress (NDC) and its leader John Mahama lack the moral right to make wild claims that the government shortchanged cocoa farmers.
According to the party, with the highest cocoa producer price in 50 years, achieving, Cocoa Farmers’ Pension Scheme, novel Living Income Differential (LID) rehabilitation of disease infested cocoa farms, other far-reaching interventions, the Akufo-Addo government has shown unprecedented commitment to the well-being of the cocoa farmers and will continue to do so for a sustainable cocoa sector.
Addressing a press conference to counter the propaganda of the NDC, Director of Communications of NPP Richard Ahiagbah pointed out that the NDC government announced a producer price of $1800 or GH₵6,800 per tonne representing 61.71% of the gross FoB of $2,950 per tonne in the 2015/16 season.
On the other hand, he said the current NPP government has announced GH¢20,943 or $1,821 per metric tonne for the 2023/24 season which is 70.03% of the weighted average FoB of $2,600 per tonne.
He explained that this means that the weighted average FoB under the NDC government was $350 higher than what the current government secured.
However, he stated that NDC paid 61.71% of the FoB to farmers which is 8.59% lower than the 70.03% of FoB the current government announced.
Mr Ahiagbah stated that these established facts exposes the propaganda of the NDC and vindicates NPP as the party that cares about the weel being of cocoa farmers.
He said the high producer price would enable farmers improve their living standards, invest in their farms, and meet other financial needs since it reduces their vulnerability to economic shocks, leading to a more stable and secure livelihood.
He is hopeful that a higher producer price motivates existing cocoa farmers to continue cocoa cultivation and encourage others to enter the industry, which can contribute to the sustainability of the cocoa sector.
Mr Ahiagbah said the high producer price has the potential to motivate the youths to pursue cocoa farming as a viable and legal alternative to other, often illicit, endeavors like Galamsey.
The Director of Communications of NPP stated that the announcement of the Producer Price was moved up to September from its typical October schedule. This change was made to give farmers timely access to funds to fulfil their financial responsibilities promptly.
He said when the World market price of cocoa plummeted from $2,950 in 2016 to $2, 050 in 2017 and rising only marginally to about $2,350 government maintained the producer price which cost the government a fortune to absorb the losses to protect farmers.
In addition, it is important to note that Ghana’s cocoa beans is mostly sold forward.
This means that the 2023/24 crop was sold between October 2022 and June 2023 at international prices ranging between $2,060 per tonne and $ 2,800 per tonne.
Mr Ahiagbah told the media that the international price of cocoa then began to increase in April 2023, when a greater percentage of the 2023/24 crop had been sold already.
He explained that the forward sale strategy enables COCOBOD to give farmers a guaranteed producer price and raise the syndicated loan offshore to pay farmers promptly for their produce.
Another significant development he alluded to is change in the Producer Price determination mechanism from Net FoB to Gross FoB.
The difference is that with the use of net FoB, the amount farmers are paid is arrived at after all industry costs had been deducted.
With this method, farmers receive less of the total proceeds from the sale.
However, with the change in the mechanism to gross FoB, the amount that farmers are paid is determined first before all other industry costs.
This method ensures that farmers get more from the sale of the beans
He announced that there is a reduction in industry cost, which is capped at a maximum of 40% of gross FoB and not net FoB.
Mr Ahiagbah said a visionary President Nana Akufo-Addo aliased with his Ivorian counterpart to negotiate $400 LID per tonne which goes directly to the farmers.
He listed productivity enhancement programmes which have led to an increase in productivity of cocoa farms from an average of 450 kilos per hectare in 2015/16 season to an average of 650 kilos per hectare in the 2022/23 season.
Additional Points
-Some 66000 hectors of CSSSVD-infested farms have been rehabilitated as off August 2023.
-The international price of cocoa as quoted is on CIF (Cost, Insurance and Freight) basis which includes insurance and freight; COCOBOD receives only the FOB price (which is the cost of beans only). Insurance and freight are received by the insurance companies and shipping lines respectively.
– Payment of the syndicated loan for the previous season has been honoured in full.
-New cocoa road contracts will not be issued but all those which have already been issued and ongoing will be honoured.
-What informed the claim that formers should be paid GHS2500 per bag and another GHS300 as bonus.
-The NDC claims to have designed a cocoa farmers’ pension scheme. This is not true. The collection of pertinent farmer data for the scheme only began in 2020.
