COCOA farmers in Ghana, the world’s second-largest cocoa producer, are reportedly hoarding beans in anticipation of a price increase. This move could strain the global cocoa market, which is already struggling to recover after poor harvests last season. According to multiple industry sources, farmers are holding back stock as they wait to see if government promises of a higher price for cocoa will materialise. The Ghana Cocoa Board (Cocobod), along with a dozen farmers, buyers, and officials, have confirmed the trend, which some say has contributed to a recent slowdown in bean purchases.
One cocoa farmer in south-central Ghana, who wished to remain anonymous, confirmed the situation. ‘I have more than 300 bags, but I won’t sell yet,’ he told Reuters. ‘I’ll only sell after Christmas. We’re hoping the government will increase the price as they promised.’
Farmers’ expectations of a price hike were fuelled by comments from Ghana’s Vice President, Mahamudu Bawumia, made while campaigning in Sefwi Wiaso, a major cocoa-producing area. Bawumia, who is running for president in Ghana’s December 7 election, told supporters that the government would raise prices for farmers. Although Bawumia later clarified that his statement had been misinterpreted, many farmers remain convinced that an increase is forthcoming.
The situation comes as Ghana grapples with significant losses in its cocoa output. Smuggling to neighbouring Cote d’Ivoire, where prices are slightly higher, has cost Ghana over a third of its cocoa production for the 2023/24 season. Cocobod officials reported that these losses, coupled with a poor harvest, have driven cocoa production in Ghana to its lowest level in over two decades, contributing to record-high global cocoa prices.
In a bid to support farmers and curb smuggling, the Ghanaian government raised the farmgate price for cocoa by nearly 45 percent at the start of the 2024/25 season in September. Farmers now receive 48,000 cedis per metric ton, or just under $3,000. However, Cote d’Ivoire recently announced a slight price increase, setting its rate at CFA 1,800 ($3.00) per kilogram, creating a marginal price difference.
Local media initially reported Bawumia’s statement as a pledge to match Ghana’s cocoa price with Cote d’Ivoire’s. On Friday, however, Bawumia clarified to Reuters that any further adjustment would depend on a ‘significant difference’ between the two countries’ prices, which he argued does not currently exist.
Still, many farmers believe that a price hike is imminent. In the town of Suhum, a district manager for one of Ghana’s top five licensed cocoa buyers said that purchases had slowed in October as farmers held on to their beans, expecting an increase. Some farmers even asked buyers to return beans they had previously sold, hoping to sell them later at a higher rate.
Joseph Aidoo, CEO of Cocobod, assured local media that the farmgate price would be adjusted if the Ghanaian cedi depreciates significantly, which would affect farmers’ earnings. However, Samuel Adimado, president of Ghana’s Cocoa Buyers Association, insisted that the current price level is adequate for farmers and that it would allow Cocobod to tackle its debt burden.
‘The question is, how long can farmers afford to hoard?’ Adimado noted. ‘As long as they don’t smuggle the beans out, they will eventually sell.’
As farmers continue to withhold their beans, the practice could add pressure on the already-tight global cocoa supply chain. With Ghana’s crucial role in the global cocoa market, experts warn that prolonged stockpiling could affect market dynamics, pushing prices even higher.
