Cocoa Revenue Falls

Tony Fofie - Chief Executive, Ghana Cocobod

Posted on: www.businessguideghana.com

Accra, Tuesday September 4, 2012

By William Yaw Owusu

The Ghana Cocoa Board (COCOBOD), Chief Executive, Tony Fofie has admitted there would be a shortfall in cocoa production this year.

“By all means there would be a shortfall. The weather has not been very kind to us around the west coast and we expect a slight shortfall in our production.”

COCOBOD had targeted cocoa production of 1.2 million tonnes for 2012 after it was able to cross 1 million tonnes for 2011, but from all indications it is not likely to attain the above-mentioned target.

Mr. Fofie disclosed this to BUSINESS GUIDE at the launch of the 7^th Alliance of Cocoa Producing Countries (COPAL) day celebration to be held at Agona Swedru in the Central region on October 1.

He said apart from poor weather conditions, a ‘plummeted’ global price for cocoa is also going to affect production.

“The global price is definitely going to affect our revenue this period because apart from the fact that there is reduced production, the global prices have also plummeted to such an extent that it is negatively going to affect our production,” he said.

Mr. Fofie further said, “Normally there is what we call fatigue. If the trees bear so much over the year, fatigue sets in and they don’t actually bear the way we want it.

“The issue is not just having good weather, the distribution of rainfall pattern is very important. If you need rainfall at a particular point in time for the development of the tree and you do not have water, it means you are creating a stifling effect on the trees itself. There is a stress at a certain point,” he explained.

He stressed the need to add more trees to the existing population to boost production, stressing that COCOBOD was working towards to attain that feat.

“We have a lot of interventions in place including the right use of chemicals to stem diseases and application of fertilizers to boost production,” he added.

He said COCOBOD usually do not disclose figures including the tonnes produced before close of season, saying “We don’t normally give out figures on how many tonnes we are expecting. It depresses the worker so we are cautious about that.

“I know that there are quiet a number of people who go around cocoa farms to do forecasts and this information is actually fed unto the global market and that actually have a negative impact on global prices,” he explained.

As part of efforts to recover revenue loss, Mr. Fofie emphasized the need to increase production by encouraging consumption of the product, particularly when research showed that there were a lot of health benefits in the consumption of cocoa.

Commenting on reports that some European chocolate manufacturers who trade cocoa beans in Ghana were threatening to source the beans elsewhere due to prolonged dry weather and heavy rains, coupled with pest attacks, Mr Fofie said the quality of Ghana’s beans makes it difficult for manufacturers to resist them.

Ernst Tanner, CEO of Lindt & Spruengli, a leading Swiss manufacturer for instance announced last week that although Lindt gets about 50 percent of its cocoa beans from Ghana, the bad weather conditions meant they (Lindt) could buy cocoa in countries such as Ecuador or Madagascar.

However, Mr. Fofie said: “In some countries like Ecuador, they produce cocoa under very large plantations but in Ghana we have peasant type of agriculture so our management system is different from them.

“In everything, we produce the best quality of cocoa. In fact in Japan, most of their processing companies source about 70 percent of their cocoa from Ghana and they are very strict in the certification procedures and other things.

“Lindt also is a very important manufacturer in Switzerland who also gets cocoa from Ghana. Let’s get it clear: the fine flavour bean is from Latin America. We use bulk beans and Lindt would not have any alternative. Ours is what they take over there.

He said: “We believe that if we encourage people to consume much more cocoa we won’t leave it to outsiders to do it for us. That is why we are at their beck and call and they are able to tell us how much they can buy it from us.”