Weak cocoa production impacting COCOBOD amid record high prices – IMF

The International Monetary Fund (IMF) has flagged 2024 as a challenging financial year for the Ghana Cocoa Board (COCOBOD), despite some gains in 2023.

The IMF reports that COCOBOD has struggled to capitalise on record-high global cocoa prices due to weak production levels during the 2023/2024 cocoa season.

This has hindered COCOBOD’s ability to meet commitments under existing forward sales contracts.

Data from the Ghana Statistical Service highlights the cocoa sector’s dire state, with a sharp 26% decline in output for Q3 of 2024, marking the fifth consecutive quarter of contraction.

The IMF further noted that Ghana missed a key opportunity to fully benefit from rising international cocoa prices due to its forward sales arrangements.

To address these challenges, the government raised the 2024/2025 farmgate price for cocoa by 50%, aiming to reduce smuggling and curb the conversion of cocoa farmlands to illegal mining sites.

In its latest staff report, the IMF recognized the government’s ongoing efforts to stabilize the sector, including the creation of a dedicated cocoa desk at the Ministry of Finance, part of a broader strategy to restore COCOBOD’s financial sustainability.