Keypoints:
- Cocoa reforms follow Ghana’s $4,200 producer price adjustment
- Government to replace foreign financing with domestic bonds
- Policy aims to stabilise farmers and expand local processing
GHANA will overhaul how it finances cocoa purchases following a sharp decline in global prices that forced a reset of farmer payments, President John Dramani Mahama announced on Saturday, outlining reforms aimed at strengthening national control over the country’s most important agricultural export.
Speaking at the Accra Reset high-level convening on the sidelines of the African Union Summit in Addis Ababa, Mahama said recent market turbulence had exposed structural weaknesses in how African commodity sectors are funded.
Reform follows cocoa price reset
The policy shift comes shortly after Ghana reduced its cocoa producer price to about $4,200 per tonne for the remainder of the 2025–2026 crop season, a decision authorities said was necessary to reflect falling international prices and stabilise the sector’s finances, as previously reported by Africa Briefing.
Mahama said the adjustment revealed deeper challenges tied to external financing dependence.
Global price fall exposes financing risks
Ghana initially set farmer payments when global cocoa traded near $7,200 per tonne under a system guaranteeing farmers roughly seventy percent of the world market price, with the remainder supporting fertiliser distribution, administration and social programmes.
But international prices later dropped sharply while the Ghanaian cedi strengthened against the dollar, creating losses for each tonne purchased at the guaranteed rate.
‘For every tonne you buy at the producer price, you have a gap,’ Mahama told delegates, describing emergency consultations held before travelling to Addis Ababa.
Ending foreign-backed cocoa purchases
Under Ghana’s traditional model, syndicated foreign loans finance annual cocoa purchases, with harvested beans used as collateral and exported quickly to repay lenders.
Mahama said the government intends to end that arrangement.
‘We are going to stop foreign funding for the purchase of our cocoa,’ he said. ‘We have enough cedis in Ghana to pay for our cocoa.’
Instead, Ghana plans to issue domestic bonds to finance purchases locally, reducing exposure to external credit conditions and allowing greater flexibility in managing supply.
Unlocking domestic processing
The president said current financing rules prevent Ghana from fully utilising its installed processing capacity, estimated at around 400,000 tonnes annually.
Because collateralised beans must be exported immediately, local processors often lack access to raw materials despite existing industrial facilities.
The proposed financing reforms would allow a greater share of cocoa to remain in Ghana for value addition, supporting downstream industries such as cocoa butter and chocolate manufacturing.
Supporting farmers and sector stability
The reforms come amid financial strain across the cocoa sector following the global price downturn, which affected farmer incomes and disrupted purchasing cycles.
Mahama framed the new approach as essential to protecting producer livelihoods while ensuring long-term sustainability.
He argued that commodity-exporting countries must redesign economic systems that leave them vulnerable to global price volatility despite producing strategic resources.
Part of broader Accra Reset agenda
Mahama linked cocoa reforms to the wider Accra Reset initiative, which seeks to align finance, trade and industrial policy around African-led development priorities.
He urged leaders to move beyond policy discussions toward rapid implementation.
‘We must stop the talking and start implementing,’ he said.
