COCOBOD Navigates Market Volatility, Seeks New Funding Model for Ghana's Cocoa Sector
Ghana's cocoa sector is undergoing a significant transformation as the Ghana Cocoa Board (COCOBOD) addresses payment challenges while developing innovative financing structures to strengthen the industry's competitiveness in global markets.
Chief Executive Dr. Ransford Anertey Abbey outlined the current market dynamics at a recent press briefing, emphasizing how global price volatility has created temporary mismatches between local farmgate prices and international trading rates.
Market Dynamics Create Temporary Challenges
The 2024-25 cocoa season marked a strategic shift from traditional syndicated loan financing to direct buyer funding, a move that demonstrates COCOBOD's adaptability in challenging market conditions. This transition occurred after legacy forward sales contracts, signed at approximately GH¢41,600 per tonne, were later impacted by significant global price fluctuations.
Current market data reveals the complexity of the situation: while COCOBOD maintained competitive farmgate prices of about GH¢80,640 per tonne to support farmer incomes, international cocoa prices have since declined to around GH¢64,000 per tonne.
Key financial metrics highlight the scale of operations:
- Over GH¢8.5 billion in cocoa sales completed
- 333,767 tonnes committed under forward contracts
- Strategic price positioning to maintain farmer competitiveness
Innovation Through Structural Reform
Dr. Abbey emphasized that these challenges have catalyzed important structural improvements. For over three decades, syndicated loan requirements limited Ghana's ability to expand local processing and value addition by requiring large volumes of raw cocoa as collateral.
The government and finance ministry are now developing a groundbreaking new funding model designed to reduce dependence on raw bean exports and enhance value-added processing capabilities. This innovative approach is scheduled for implementation in the 2026-27 season.
Commitment to Farmer Partnership
COCOBOD remains steadfast in its commitment to farmer welfare, with Dr. Abbey stating: "This is their sweat. They deserve to be paid. We understand the situation fully, and we are working to find a solution as quickly as possible."
The organization has clarified that operational vehicle purchases were funded through internally generated resources to address critical infrastructure gaps across cocoa-growing districts, separate from crop proceeds.
Global Market Recovery Signals
Recent positive developments include cocoa prices settling higher following Hershey's optimistic 2026 outlook, indicating renewed confidence in cocoa demand and suggesting improved market conditions ahead.
This period of adjustment positions Ghana's cocoa sector for enhanced competitiveness through structural reforms, innovative financing, and continued commitment to farmer prosperity in the global marketplace.