The government has announced it will absorb an estimated $150 million in losses incurred by the Ghana Cocoa Board (COCOBOD) as Cabinet directs the immediate purchase and payment for cocoa beans already supplied by farmers.
The move comes after Ghana reduced its cocoa farmgate price by 28 per cent — the first such cut since at least 2020 — in response to declining global cocoa prices and rising payment arrears owed to farmers.
When announcing the price adjustment and a broader reform package, Finance Minister Cassiel Ato Forson assured cocoa farmers that outstanding payments would be honoured.
Cabinet has directed COCOBOD to commence immediate payment of all affected cocoa farmers,” he stated.
However, questions lingered over how the payments would be financed, given COCOBOD’s well-documented liquidity constraints in recent years.
Speaking on Top Story on Joy FM, Deputy Finance Minister Thomas Ampem Nyarko clarified that the government would step in to absorb the losses associated with purchasing approximately 50,000 metric tonnes of cocoa beans already delivered by farmers but not yet paid for.
Because the beans were supplied before the reduction in the farmgate price, farmers will be paid the previous rate of just over $5,200 per tonne, despite the downward revision in prices.
Under current market conditions, this arrangement means COCOBOD will purchase the cocoa at a price significantly higher than prevailing global rates, resulting in substantial financial losses.
There are some 50,000 tons of cocoa [that farmers have already supplied]. Government has agreed to [pay] the farmers the price that was agreed with them earlier. That means COCOBOD is going to make huge losses of about $150 million. Government is absorbing that cost,” the Deputy Minister explained.
At current exchange rates, the $150 million loss translates into roughly GH¢1.6 billion — a sizeable fiscal commitment at a time of ongoing budget consolidation efforts.
The decision underscores the government’s attempt to balance fiscal discipline with protecting farmer incomes and maintaining confidence in Ghana’s cocoa sector, a critical pillar of the economy.
Analysts say the intervention may help ease tensions among cocoa farmers while providing COCOBOD with temporary relief from the immediate financial strain of unpaid deliveries, even as broader structural reforms in the sector continue.
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