Ghana has announced a substantial increase in cocoa producer prices, raising payments to farmers by over 60% in a bid to bolster their incomes and reshape global market dynamics. The decision, effective for the 2025-26 season, lifts the guaranteed rate from $3,100 to $5,040 per tonne, marking the West African nation’s effort to address longstanding concerns about equitable compensation in the cocoa sector.
Finance Minister Cassiel Ato Forson underscored the policy’s significance during a briefing in Accra, calling farmers “a critical pillar of our economy” and affirming the government’s commitment to ensuring they “benefit from the gains” amid fluctuating global prices. The move positions Ghana – the world’s second-largest cocoa producer – to pressure regional rival Ivory Coast, which currently pays farmers approximately $2,440 per tonne. Analysts suggest the adjustment could further inflame global cocoa costs already strained by climate disruptions, aging plantations, and tightened supply chains.
The hike aligns with President John Mahama’s December election pledge to raise farmers’ share of export earnings to 70% of the Free-On-Board (FOB) value, the benchmark price for cocoa exports. For the 2024-25 season, farmers received 63.9% of the $4,850 FOB price. With the FOB value now reaching $7,200 – a blend of legacy contracts and future sales – officials argue the revised rate better reflects market realities. Forson cited improved macroeconomic conditions, including a stabilizing local currency and moderating inflation, as enabling factors.
Critics, however, contend Ghana’s price stabilization mechanisms have historically struggled to keep pace with global spikes, prompting some farmers to abandon cocoa for informal gold mining. This shift has exacerbated environmental degradation and reduced arable land, compounding production challenges. Advocates for equitable trade stress that securing fair farmer compensation remains a complex hurdle, entangled with allegations of corporate exploitation and governance gaps across West Africa’s cocoa belt.
Alongside the price revision, Accra revealed plans to revive a subsidized agricultural input program, distributing fertilizers, pest control agents, and yield-boosting tools to farmers. The initiative aims to counter declining productivity amid global demand for chocolate and cocoa-based products. As Ghana’s decision reverberates through commodity markets, observers await responses from multinational buyers and regional producers, with implications for both farmgate livelihoods and supermarket prices worldwide.
