Ghana’s president says Cocobod faces $1.3 billion gap in revenues
Ghana's cocoa sector has remained under pressure, though weather for 2025 may improve crop yields. Pic: Tony's Chocolonely
Ghana’ president, John Mahama, has asserted the nation’s cocoa body, Cocobod, is expected to lose around $1.3 billion in funds regarding advanced contracts, as the country faces ongoing financial tests, reports Neill Barston.
In a recent speech following his recent re-appointment, he addressed the region’s present economic challenges, with the West African country reportedly experiencing a considerable cost of living crisis.
As per a report by Reuters, the country is presently scheduled to pay back a total of $8.7 billion in debts, including four billion to its electricity company and a further $2 billion owed to its cocoa regulator, Cocobod – which itself is facing notable challenges, and is reportedly facing debts of 32.5b billion cedis $2.1 billion).
President Mahama asserted: “In the 2023/2024 season, Cocobod was unable to supply 333,767 metric tons of cocoa, which it has sold at £2,600 per tonne. As a result, the then management of Cocobod rolled over these contracts into the 2024/25 season.
“This implies that for every tone of cocoa delivered this year, in fulfillment of the rollover contract, Cocobod and Ghanaian farmers will lose $4000 in revenue, and Cocobod will lose another $495 million by the time the board finishes supplying the remaining contracts.”
His claims over the contract value losses centred on the fact that in his view, Cocobod had not capitalised on the comparative high prices that soared to $12,000 a tonne on Futures markets in the past two years. Market trading is now somewhere between $7-8,000 a tonne, which is still markedly higher than just two years ago.
Confectionery Production has approached Cocobod for comment on the story, but at the time of going to press, no response had been received.
ICCO report optimism
While Ghana, which stands as the world’s second largest cocoa producer behind its West African neighbour Ivory Coast, faces its share of challenges, market movement in recent weeks has suggested prices are potentially slowing to manageable levels.
As the ICCO industry body notes, record prices for the past several years on the one hand have been accompanied by investments in cocoa farms.
In a statement, it said: “The results are now being seen in improved output from producing countries. Year-on-year arrivals data from top producer Côte d’Ivoire reported by LSEG indicated that arrivals at Ivorian ports by 9 March 2025,
were up by 14.8% to 1.4 million tonnes as compared to the same period a year ago.
“For Ghana, graded and sealed cocoa at warehouses was reported to be nearing
550,000 tonnes as at end of January 2025. This figure is already above the country’s
total production data for the 2023/24 season, which was estimated at 530,000
tonnes. Production in other leading exporting countries have been reported to be following an upward trend, too.”
However, it added that demand for cocoa – (which has been seen particularly for premium chocolate products), has been pressured downfrom high cocoa
prices with most major manufacturers reporting financial challenges in terms of
operational costs. In February, Mondēlez reported ‘unprecedented cocoa cost
inflation.
As the ICCO noted, Hershey also reported that it ‘expect the surge in cocoa prices to put significant pressure on 2025 earnings. With high input costs, manufacturers
are likely to tilt towards raising the prices of their products which could consequently increase their sales values but decrease their sales volumes.
Consequently, as has been seen, consumers have become more selective in their purchasing due to household budget constraints, which has seen the slowing of certain categories of confectionery in recent months.
Furthermore, the ICCO also observed that potential introduction of tariffs represented another significant uncertainty for the market, which has become accustomed to shocks in recent years.
