The Chief Executive Officer of the Ghana Cocoa Board (COCOBOD) Joseph Boahen Baidoo has indicated that the Government of Ghana may not be able to get money to buy Cocoa this year. This he attributed to the Covid-19 outbreak.
According to the COCOBOD Boss, the outbreak of the virus has rendered it impossible for government to go into the financial market to raise the usual Cocoa syndicated loan which government usually rely on to finance the purchase of cocoa beans from farmers. He further explained that, because of the outbreak of the novel virus, almost all airports are closed making it impossible for anyone to travel abroad to negotiate any financial deal since most countries have locked down in a bid to control the spread of the Corona virus pandemic.
In an interview on Joynews television on 10th April 2020, Mr Joseph Boahen Baidoo expressed worry over his outfit’s inability to make headway in the processes that will finally land in cash to buy cocoa beans this year. He said they have had to resort to conference calls to negotiate a deal to get money from the international market, an option which has so far not yielded any result thereby delaying the entire process.
Last year, the government of Ghana and the government of Cote d’ivoire jointly negotiated new trading mechanism which guaranteed a unique price at which both countries will sell cocoa beans to international buyers. Under the new arrangement, the two counties (Ghana and Cote d’ivoire) agreed that farmers in both countries will be guaranteed a minimum price of 70% of the floor price $2,600 FOB ($2,700 CIF) per tonne. But this arrangement is likely to be destroyed if the Ghanaian government is unable to secure money to buy Cocoa beans from farmers. In 2019 (previous cocoa purchase season) COCOBOD secured US$1.3 billion cocoa syndicate loan to purchase some 850,000 metric tonnes of cocoa beans from Cocoa farmers. But the same government is having serious difficulty in raising close to the same amount to purchase Cocoa beans this year.
Government’s inability to secure money would leave most cocoa farmers worse off, considering the dire economic conditions brought forth as a result of the corona virus outbreak.
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