The 2020/21 cocoa season would be touted as one that brought excess value to farmers. This is because of positive outcome of the collaboration between Ghana and Cote d’Ivoire to reset the new pricing contract of the commodity.
There are further considerations including controlling and regulating cocoa price like the OPEC style. The aim is to optimize the gains for the cocoa-producing economies and also improve the lives of the farmers, their families and communities.
One arrangement that may help achieve the improvement of the farmers is
the Living Income Differential (LID) of $400 a tonne. Ghana and Cote d’Ivoire announced in July that all cocoa purchases for
the 2020/21 season must include a Living Income Differential (LID) of $400 a
tonne in a bid to tackle pervasive farmer poverty.
The COCOBOD head, Mr. Boahen Aidoo, told REUTERS that Ghana has sold nearly 200,000 tonnes of cocoa for the 2020/21 season, with prices including a new premium to support farmers. He added that everything is going on course.
This is part of the reasons why Ghana and Cote d’Ivoire halted all forward sales for the 2020/21 season. With the final pricing agreed on, Mr Aidoo said Ghana was expecting to sell forward around 650,000 tonnes of next season’s crop.
Though there was an initial rebuff from the buyers to seek alternative raw materials, there is no a shift by the chocolate producers to back the LID.