Ghana’s cocoa sector experienced a significant downturn, recording a negative growth of 20.2% in the first quarter of this year compared to the same period in 2023.
This data, released by the Ghana Statistical Service, highlights a deepening crisis within the sector. Additionally, the sector declined by 6.1% compared to the fourth quarter of 2023. It was the worst subsector in the first quarter.
Historically, cocoa has been the backbone of Ghana’s economy even before independence. However, the sector has faced severe challenges, especially in the past three years. Cocoa production has drastically fallen from over one million metric tonnes in the 2020/2021 season to between 492,000 and 580,000 tonnes in the 2023/2024 season. Consequently, earnings from cocoa and cocoa products plummeted by 49% to US$599.3 million in the first four months of this year compared to the same period last year.
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The decline in production has adversely affected cocoa processing companies, forcing many to either shut down or limit production, resulting in job losses. The scarcity of cocoa beans has also led to many cocoa products being unavailable on the shelves of shops, causing revenue losses for companies, the state, and others within the value chain. Moreover, Ghana has missed out on the benefits of an unprecedented 200% hike in cocoa bean prices over four months.
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Several factors contribute to the reduced cocoa harvest in Ghana. Critics argue that the government has neglected the sector, failing to sustain high production levels. The 2023/2024 crop season is expected to be the lowest since 2004.
Climate change has worsened the situation, with unpredictable rainfall patterns and rising temperatures causing droughts that dry out trees and excessive rain that promotes fungal diseases like Swollen Shoot. This virus spreads rapidly through plantations, killing cocoa trees and significantly reducing yields.
Smuggling and illegal mining are also major issues. According to a statement from the Ghana Cocoa Board on January 12, 2024, the “unbridled and unmitigated” smuggling of cocoa to neighboring Côte d’Ivoire and Togo, along with illegal small-scale mining (Galamsey), has devastated Ghana’s cocoa landscape and severely reduced revenue from cocoa trade. Farmers are enticed by large sums to sell their land to illegal miners, while others abandon their farms due to the dangers posed by the mining activities.
High input costs, particularly for fertilizers that were once provided to farmers for free, further contribute to the decline in production. Without access to affordable inputs, farmers struggle to maintain their cocoa farms, exacerbating the industry’s challenges.
In response to questions from The Accra Times, the Ghana Cocoa Board stated that with the onset of the rains, it hopes to supply cocoa processing companies with sufficient main crop beans to revive the struggling cocoa processing industry.
