Ghana and Côte d'Ivoire Open Cocoa Initiative HQ to Advocate for Fairer Producer Compensation

Ghana and Côte d'Ivoire, the world's top cocoa producers, have opened the Cocoa Initiative headquarters in Accra, Ghana on April 18, 2024. The initiative aims to advocate for fairer compensation for cocoa producers as global cocoa prices have surpassed $10,000 per tonne. The two countries, responsible for 65% of the world's cocoa, are taking steps to build their influence in the global cocoa market and ensure that producers receive a larger share of the profits.

The ceremony was co-hosted by Ghanaian President Nana Akufo-Addo and Ivorian Prime Minister Robert Mambe, and was supported financially by the African Development Bank. The initiative's goals include influencing global cocoa prices, empowering producers, and implementing the 'Decent Revenue Differential' (DRD) - a $400 per ton price floor established by the two countries.

Why this matters: The opening of the Cocoa Initiative headquarters signifies a meaningful step towards addressing the challenges faced by cocoa farmers in Ghana and Côte d'Ivoire. By advocating for fairer compensation and implementing measures like the DRD, the initiative aims to ensure that cocoa producers receive a larger share of the profits from the booming global cocoa market.

The inauguration comes ahead of the upcoming World Cocoa Conference hosted by the International Cocoa Organisation (ICCO), where the initiative plans to advocate for a "new generation of cocoa that guarantees a decent living for producers and fosters a sustainable cocoa industry." The leaders of both countries emphasized the necessity for fairer compensation for cocoa farmers, as they currently receive a disproportionately small share of the overall profit within the cocoa value chain despite producing over 63% of global cocoa.

The Cocoa Initiative has successfully implemented the DRD, which has been praised for its resilience against criticism and attempts to circumvent it. The Ivorian Minister of State for Agriculture commended the initiative's collaborative approach, crediting it with boosting cocoa sector prices and benefitting all stakeholders. The executive secretary of the initiative urged cocoa buyers to recognize cocoa as a premium commodity and provide fair pricing that reflects its true value.

The cocoa market has witnessed a dramatic price surge, with futures on the ICE escalating by 14% and reaching nearly £10,000 per metric ton. This surge is driven by robust global demand that continues to defy the rising price trends. North American, European, and Asian cocoa processing have all exceeded forecasts, reinforcing the strength of global cocoa demand.

However, the windfall from these soaring prices may not quickly reach the farmers in Ivory Coast and Ghana due to governmental trading policies that discourage immediate reinvestment in crop production. The two countries have faced significant challenges in recent years, including drought, fires, and other climate change-induce

Key Takeaways

• Ghana and Côte d'Ivoire open Cocoa Initiative HQ to advocate for fairer cocoa prices.
• The initiative aims to implement a $400/ton price floor and empower cocoa producers.
• Cocoa prices have surpassed $10,000/ton, but farmers may not benefit due to government policies.
• The initiative plans to advocate for a "new generation of cocoa" at the upcoming ICCO conference.
• The DRD price floor has been praised for its resilience and impact on the cocoa sector.