Gov't reviews upwards producer price of cocoa by 62.74% for 2014/15 season The Producer Price Review Committee, PPRC on cocoa has reviewed upwards the producer price of cocoa from three thousand three hundred and ninety-two Ghana cedis per tonne to five thousand five hundred and twenty Ghana cedis per ton for the 2014/2015 cocoa season. The amount which represents an increase in price of two thousand, one hundred and twenty-eight Ghana cedis takes effect from tomorrow the3rd of October. The Minister of Finance, Seth Tekper who announced this at a media briefing said the figure translates into three hundred and forty-five Ghana Cedis per bag of cocoa 64 kilogram. Below is the statement: PRESS RELEASE REVIEW OF THE PRODUCER PRICE OF COCOA FOR THE 2014/2015 COCOA SEASON THURSDAY,2nd OCTOBER 2014 1. INTRODUCTION The Producer Price Review Committee (PPRC) on cocoa met today under my Chairmanship and agreed on a new Producer Price of cocoa for the 2014/2015 season which opens on Friday, 3rd October 2014. 2. PRODUCER PRICE: The PPRC has reviewed upwards the producer price of cocoa from GH¢3,392.00 per tonne to GH¢ 5,520.00 per tonne for the 2014/15 cocoa season. As compared to the previous season, this amount represents an increase in price of GH¢2,128.00 per tonne or 62.74%. This figure translates into GH¢345 per bag of 64 kg gross which represents About 75 percent of the net FOB. COCOBOD and Government have decided to pay bonus to farmers at the time of sale of their produce. Accordingly, an additional amount of GH¢5.00 per bag of 64kg gross weight has been approved. Therefore, for each bag of 64kg gross weight of cocoa sold by the farmer, the farmer shall be paid GH¢345.00 per bag plus GH¢5.00 as bonus. LBCs are to take note of this and pay our cherished farmers accordingly. To emphasize, LBCs are to ensure that farmers are paid at the time of the sale of their produce GH¢350 per bag of 64Kg gross weight . MINISTRY OF FINANCE P. O. BOX MB 40 ACCRA In case of reply the number and date of this letter should be quoted Our Ref .Your Ref .Tel No: 0302665587 REPUBLIC OF GHANA 2 Farmers must insist that at the time of sale they are paid GH¢350.00 per bag of 64kg gross weight of their produce. This brings the price and bonus per ton of cocoa to GH¢5,600.00 (US$1,750.00) which is equivalent to 76% of the net FOB. All LBCs must comply. The new price takes effect from Friday, 3rd October, 2014. The last two seasons saw the average FOB prices of cocoa used for the review of the Producer Price declining from US$3,000 in 2011/12 to US$2,300 in 2012/13. The 2013/14 season even experienced a further decline in the price to US$2,130.00 per ton. Government was compelled to drastically reduce its share of the 2013/14 cocoa export duty, in order to raise the producer price paid to our hardworking cocoa farmers. That decision was taken to increase the earnings of farmers so as to enhance their welfare. There have been positive developments on the world cocoa market since the last review of the Producer Price in October 2013. It is against these positive price developments that the Producer Price Review Committee met and decided on the upward review of the Producer Price. During the 2008/09 crop year, Government set up a Stabilization Fund with annual contributions from the FOB price as a risk mitigating Mechanism against a fall in international cocoa prices. The primary objective of the Fund was to apply it to sustain the earnings of cocoa farmers in challenging times like was experienced during the 2013/14 cocoa season. The PPRC has decided once again to re-establish the Stabilization Fund so as to be able to cushion farmers should the world market price begin to decline as we move into the future. 3. OTHER RATES AND FEES The PPRC also approved other rates and fees for all other stakeholders in the industry. These include the Buyers’ margin, Hauliers’ rate, warehousing and internal marketing costs as well as fees for disinfestation, grading and sealing. The margins, rates and charges have been increased substantially over last year’s levels in order to ensure that other key stakeholders operate at profitable levels to sustain the cocoa industry. 4. GOVERNMENT SUPPORT AND COMMITMENT I would like to emphasize that Government will continue to support other interventions including the pests and diseases control (Mass Spraying) for farmers, and the fertilizer application program to increase the productivity of our cocoa farmers. Government also commits itself to continuing with the rehabilitation and replanting of cocoa farms, the provision of 50 million free improved seedlings over the next three years to farmers to help replant diseased infected trees that would be removed over the period. Government will rehabilitate existing schools, construct new ones and provide them with essential social amenities. To enhance the welfare of our cocoa growing communities, Government is supporting COCOBOD to expand its cocoa roads rehabilitation program. COCOBOD has also put in place a child education support program which aims at building schools and libraries in deprived cocoa communities. Government will thus continue to support COCOBOD to play its role as a major contributor to the economic development of Ghana. HON. SETH E. TERKPER MINISTER OF FINANCE