Ghana farmers sweet on cocoa minimum price drive

Last week, Ivory Coast and Ghana decided to rise the global price of cocoa. (AFP)
Updated 01 July 2019
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Ghana farmers sweet on cocoa minimum price drive

  • Ivory Coast and Ghana had earlier threatened to stop selling their products to buyers unwilling to meet a minimum price of $2,600 per ton
  • The two African nations together account for 60 percent of the world’s cocoa production

ACCRA: Kwame Boadu was forced to abandon his cocoa plantation to work in Ghana’s capital Accra, but when the government announced plans for a price floor he began dreaming of a return to his fields.

A higher guaranteed price for the crop means a cocoa farmer “can afford fertilizer, he can afford weedkiller, he can employ more laborers, so he can increase his production,” he said.

And moreover, it would guarantee that farmers get more money when they increase output, the 34-year-old added.

Earlier this month, key producers Ivory Coast and Ghana threatened to stop selling their products to buyers unwilling to meet a minimum price of $2,600 per ton.

The two African nations — which together account for 60 percent of the world’s cocoa production — want to end a situation where cocoa producers make only $6 billion in a global chocolate market worth around $100 billion.

The move sent world cocoa prices briefly above $2,500 per ton, but they have since fallen back below that level.

IN NUMBER

The likely price of a ton of cocoa following Ghana and Ivory Coast’s decision to introduce a price floor.

After spending much of 2015 above $3,000 per ton, world cocoa prices slumped, fluctuating around $2,000 in 2017. The price drop squeezed farmers, who welcome government intervention.

“We don’t have anything to sell apart from cocoa,” said Alhaji Alhassan Bukari, who heads up Ghana’s farmers’ union.

“So if the government has thought about the farmers, they come together to fight for the farmers, we support them,” he said.

Cocoa is a key sector of the national economy, according to the Ghana Cocoa Board, both in terms of providing employment to around 800,000 families and generating revenue for the government’s coffers.

Ghana’s Vice President Mahamudu Bawumia said earlier this month at a meeting with farmers and buyers that Ghana and Ivory Coast made their proposal to ensure farmers get “a fair share of the wealth that the industry generates.”

Establishing a price floor would also help revive rural communities.

“A satisfactory price of cocoa beans will go a long way to complement the government's investments in rural infrastructure and improve the wellbeing of the communities,” said Bawumia.

But farmers are not the only ones concerned by the discussion over cocoa prices.

While chocolate has long been a marginal product in Ghana, despite the country being a major producer of its primary ingredient, in recent years a new batch of chocolate makers has set up shop.

Selassie Atadika, the chocolatier at Midunu, a maker of handcrafted chocolates, says she has noticed more local chocolate on the shelves in Ghana’s shops.

“I think in general there is more awareness, people are using it at more events and things like that so there is probably an increase in people’s interest in buying chocolate.”

These local producers have an interest in cocoa prices, and fear a jump in prices could hurt their businesses.

Atadika said she hopes a price floor would help cocoa farmers.

But for those trying to develop chocolate as a product “issues remain, even if the price of cocoa beans does not change, the price of sugar, milk powder and electricity will still be a major influence in their capability to make the chocolate,” she said.

Local producers buy beans from the second, smaller harvest. Moreover, they enjoy a subsidy on the purchase of beans from this harvest, according to the Ghana Cocoa Board.

“What would make an impact on domestic chocolate makers is if there was a loosening of regulations regarding who can sell and buy main crop beans, which would open opportunities for new domestic sourcing routes for cocoa,” said Kristy Leissle, a cocoa industry expert and lecturer at the University of Washington Bothell.

A development which would benefit all is if more cocoa was processed in Ghana, capturing more of the value added in the industry.

“We need to add value in Ghana, so we can send the world’s best products from here,” said chocolatier Atadika.


Huawei in public test as it unveils sanction-hit phone

Updated 36 min 23 sec ago

Huawei in public test as it unveils sanction-hit phone

  • Hit by US sanctions, Huawei's Mate 30 will not be allowed to use Google’s Play Store
  • Household-name services like WhatsApp, Instagram and Google Maps will be unavailable.
BERLIN: Chinese tech giant Huawei launches its latest high-end smartphone in Munich on Thursday, the first that could be void of popular Google apps because of US sanctions.
Observers are asking whether a phone without the Silicon Valley software that users have come to depend on can succeed, or whether Huawei will have found a way for buyers to install popular apps despite the constraints.
The company has maintained a veil of secrecy over its plans, set to be dropped at a 1200 GMT press conference revealing the Mate 30 and Mate 30 Pro models.
Huawei, targeted directly by the United States as part of a broader trade conflict with Beijing, was added to a “blacklist” in Washington in May.
Since then, it has been illegal for American firms to do business with the Chinese firm, suspected of espionage by President Donald Trump and his administration.
As a result, the new Mate will run on a freely available version of Android, the world’s most-used phone operating system that is owned by the search engine heavyweight.
While Mate 30 owners will experience little difference in the use of the system, the lack of Google’s Play Store — which provides access to hundreds of thousands of third-party apps and games as well as films, books and music — could hobble them.
Household-name services like WhatsApp, Instagram and Google Maps will be unavailable.
The tech press reports that this yawning gap in functionality has left some sellers reluctant to stock the new phones, fearing a wave of rapid-fire returns from dissatisfied customers.
Huawei president Richard Yu said at Berlin’s IFA electronics fair this month that his engineers found a “very simple” way to install the hottest apps without going via the Play Store.
Huawei could offer its own app store in a preliminary version, setting itself up as a competitor to the dominant Apple and Google offerings, observers speculate.
Over the longer term, the company could build out a similar “ecosystem” of devices, apps and services as the Silicon Valley companies that would bind users more closely to it.
The world’s second-largest smartphone maker after Samsung, Huawei earlier this month presented its proprietary operating system HarmonyOS, a potential replacement for Android.
The Mate 30 will not yet have HarmonyOS installed.
But it could make for a new round in the decades-old “OS wars” between Microsoft’s Windows and Apple’s Mac OS, then Android versus Apple’s iOS.
Meanwhile, Eric Xu, current holder of Huawei’s rotating chief executive chair, has urged Europe to foster an alternative to Google and Apple.
That could provide an opening for Huawei to build up Europe’s market of 500 million well-off consumers as a stronghold against American rivals.
“If Europe had its own ecosystem for smart devices, Huawei would use it... that would resolve the problem of European digital dependency” on the United States, Xu told German business daily Handelsblatt.
He added that his company would be prepared to invest in developing such joint European-Chinese projects.