Business News of Saturday, 12 October 2002
Ghana failed to meet its projected production target for cocoa in the last season as announced in the 2002 budget, Mr Yaw Osafo-Maafo, Minister of Finance, said in Accra on Friday.
Mr Osafo-Maafo, who was speaking at press conference to announce a new cocoa producer price for this year's crop season that opened on Friday, said government projected production to be at 490,000 tonnes but managed only 340,000 tonnes.
"But even then, we lost about 60,000 tonnes to smuggling into Cote d'Ivoire by some farmers," he said.
Cote d'Ivoire, which produces 1.3 million tonnes of cocoa, sells it on spot basis usually with a more attractive price depending on international market trends.
The Finance Minister said he was not happy about the smuggling adding, "if you lose 60,000 tonnes of cocoa in a season its a big figure. The best way out is to secure a good price for the product."
He, however, discounted arguments that government must halt the fixing of prices and allow the forces of demand and supply to determine the prices.
"Information from countries such as Cameroon and elsewhere who adopted the demand and supply method indicate it could not be sustained and are going back to the price fixing system."
Asked if production targets could still be met, Mr Osafo-Maafo said with current events, "it does not look likely that we will meet our targets."
He said government has embarked on a number of programmes such as good husbandry and adoption of high-tech production measures.
"For the first time in cocoa production in Ghana, we will also start using fertiliser to increase yield to about four fold."
Mr Osafo-Maafo said government was instituting a programme to increase production of cocoa across the six cocoa growing regions, and expressed the hope that farmers would take advantage of it to not only make Ghana regain her position in the world, but increase revenue to the country.
The new cocoa producer price is fixed at 8.5 million cedis. This is up by 37 per cent from the previous price of 6.2 million cedis.
World cocoa prices hit 2,500 dollars a tonne recently reaching a 17 year-high heightening fear that demand would outstrip supply for the third year running, especially with the political instability in La Cote d'Ivoire, the largest producer.
Ghana recently lost its position as the world's second largest cocoa producer to Indonesia, which now produces more than 450,000 tonnes. Ghana's production currently stands at about 340,000 tonnes.