Ghana, the world’s second-largest cocoa producer, faces a significant decline in cocoa export earnings, projected to drop below $2 billion in 2024—the lowest level since 2010.
Despite robust cocoa futures driven by supply restrictions during the 2023/2024 season, analysis by the JoyNews Research Desk of Bank of Ghana data reveals that the country’s cocoa industry, once a cornerstone of its economy, is on track for its weakest export earnings in over a decade.
Cocoa revenues peaked at $2.87 billion in 2011 but have steadily declined to $2.12 billion in 2023, marking a cumulative drop of 26%—an average annual decrease of 2% over the past ten years.
With 2024 projections indicating a further dip below the critical $2 billion threshold, this ongoing Cocoa decline is likely to exacerbate pressure on the Ghanaian cedi, worsening the country’s fiscal challenges.
Multiple factors are crippling cocoa production, including illegal mining (galamsey), erratic weather patterns, crop diseases, and rampant smuggling. These challenges have severely hindered Ghana’s ability to benefit from rising global cocoa prices, complicating efforts to secure cocoa-syndicated loans, which have historically provided essential foreign exchange to stabilize the cedi.
As of August 2024, cocoa export earnings were only $917.8 million, the lowest in six years for that period, and significantly below the $1.7 billion average for the first eight months of the year since 2019. Current cumulative inflows from cocoa exports are $782 million below the five-year average and 43% lower than the same period in 2023, indicating a deepening crisis in the sector.
SOURCE: http://dew360.net
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