Chocolate
© Julien Bosseler
The promise of higher compensation for cocoa farmers has reversed the spectacular rise in the price of cocoa beans on the international market. Higher income is expected to motivate farmers to produce more.
A sigh of relief on several banks. Sweet tooths have seen cocoa prices drop for three days in a row after reaching an all-time record of more than $10,000 per tonne in early April. The generally poorly paid cocoa farmers have the prospect of higher wages, after Ghana and Ivory Coast decided to raise the price of cocoa beans. What does one have to do with the other? Higher wages are expected to encourage farmers to invest in new cocoa fields and higher returns.
Ivory Coast and Ghana are the two most important cocoa producing countries in the world. Ivory Coast took the lead and was the first to decide to offer 1,500 Ivorian francs per kilo of cocoa beans for the next harvest. That is fifty percent more than the price of the previous harvest, which has just ended. Ghana, the number two cocoa producing country, is now following with a similar price increase. In both countries, a government body determines the fixed cocoa price to better protect small farmers against price volatility on the world market. Cocoa cultivation is still largely done by individual farmers.
Crop failures
The extremely high cocoa prices in recent months are the result of lower yields due to crop failures due to bad weather conditions and the aging of the plantations. Most likely, speculation drove prices up further. On April 2, 2024, the cocoa price peaked at $ 10,051 per tonne, compared to less than $ 3,000 per tonne a year earlier. At this writing, the price was hovering around $9,500.
2024-04-04 16:26:30
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