COCOBOD has announced that it has received a commitment from its trade partners to pay the US$400 Living Income Differential (LID) to farmers for the 2021/2022 cocoa crop season.
The LID was an initiative pushed by Ghana and La Cote d’Ivoire to set aside a fixed amount of US$400 solely for cocoa farmers in the two countries.
The move was initially objected to by some international cocoa buyers, but was accepted after the plight of cocoa farmers was highlighted – showing them being the poorest in the cocoa processing value chain.
In recent times, there were publications that some international cocoa buyers had suggested the initiative be suspended due to the negative impact of COVID-19 on the industry.
However, COCOBOD has disclosed that it has received full assurance from its trade partners that the pledge will be honoured when the new season starts on Friday.
“Let me assure you that the Living Income Differential (LID) has come to stay. We have the support of major international stakeholders including the European Union, the International Cocoa Organisation and the World Cocoa Foundation,” Chief Executive of COCOBOD,” Joseph Boahen Aidoo said in a statement.
He stressed that there is no way the initiative will be reversed since it has been documented and approved by all stakeholders to improve the farmers’ well-being.
The new season, which is scheduled to start from Friday 8th October 2021, will see a 64-kilogram bag of cocoa maintained at GH¢660.
This translates into GH¢10,560 per metric tonne for the 2021/2022 crop season, representing 87.1% of the Free on Board (FOB) value.
COCOBOD is hopeful it will exceed the 2020/2021 crop season record production of 1,040,000 due to new initiatives introduced to increase cocoa yield per hectare.
US$1.5billion for new season
To help achieve its target for the new season, COCOBOD in September 2021 successfully secured a US$1.5billion Receivables Backed Pre-Export Trade Finance Facility to enable it to purchase the projected volumes of cocoa beans for the 2021/22 crop year.
Source: Business and Financial Times