Ghana has reduced the farmgate cocoa price paid to farmers, aligning it with international market levels in an effort to stimulate demand, and introduced a new financing model for purchasing cocoa beans.
The announcement was made on Thursday as part of broader measures to support farmers after a sharp drop in global cocoa prices, Reuters reported.
The world’s second-largest cocoa producer has faced difficulties paying farmers due to a steep decline in global demand.
Over the past year, international cocoa prices have fallen by half, reaching two-year lows of about $4,000 per metric ton.
Ghana’s farmgate price, set annually by market regulator Cocobod, had been fixed at 58,000 cedis per ton, or nearly $5,300. This higher price discouraged international traders, reduced demand, and left many farmers unpaid.
Under the new adjustment, the farmgate price will be 41,392 cedis ($3,580) per metric ton for the remainder of the 2025/2026 season, Finance Minister Cassiel Ato Forson said at a press briefing.
“The current situation is largely driven by the unwillingness of buyers to purchase Ghana’s cocoa because it has become uncompetitive and very expensive,” Forson said.
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Thousands of farmers experienced payment delays, leaving them without funds for food, school fees, and essential farm maintenance.
Many also reported having large volumes of unsold cocoa beans sitting on their farms, according to Reuters. Forson stated that Ghana’s cabinet has instructed Cocobod to begin immediate repayment of all affected cocoa farmers.
He explained that the new financing model will depend on domestic cocoa bonds issued and managed by the regulator, with repayments linked to sales proceeds within the same crop year.
Forson also announced that a new bill will be presented to parliament to tie farmgate prices to international market rates and ensure farmers receive at least 70% of the gross Free on Board (FOB) price.
A coalition of Ghanaian cocoa farmers said it was prepared to accept lower prices for future deliveries, on the condition that the government first settles outstanding payments for beans already delivered at the official rate.
Following the ministry’s announcement, the coalition urged the government to fast-track the proposed bill and clear all arrears.
Ghana currently processes between 30% and 40% of its cocoa beans domestically. Forson said the country aims to increase local processing to at least 50% during the 2026/27 crop season.
He added that the government plans to revive the state-owned processing company CPC to help achieve that target.
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Image Credit: Market Screener
