Ghana, the world's second-largest cocoa producer, intends to raise its farmgate price for the 2026-27 season by approximately 6% to 2,737 cedis ($240) per 64-kilogram bag, up from the current 2,587 cedis. This proposed increase, which awaits the finance minister's approval, is designed to support farmers but risks widening the price gap with neighboring Ivory Coast and could encourage more smuggling across the border. Ivory Coast recently cut its farmgate price by 57.1% to 1,200 CFA francs per kilogram for its current season, despite a June agreement with Ghana to harmonize farmer prices.
This decision comes as Ghana faces significant challenges, including a forecast 16% decline in cocoa production for the 2026-27 season due to weather, crop disease, aging farms, and illegal gold mining. Ghana's cocoa industry regulator, COCOBOD, is also struggling to finance bean purchases, seeking $1.4 billion (GH¢16.3 billion) from local investors after its traditional foreign financing model collapsed. As of late September, COCOBOD still owed licensed cocoa buyers approximately $347 million for cocoa supplied in the previous season.
Previously, Ghana had to adjust its cocoa prices several times. In February, the farmgate price was cut from GH¢58,000 to GH¢41,392 per tonne after international cocoa prices fell, making Ghanaian cocoa uncompetitive and leading to 50,000 tonnes going unsold. A new Ghana Cocoa Board Act, passed in 2026, guarantees farmers at least 70% of the gross export value of their beans, aiming to tie their pay more closely to world prices.
The global cocoa market is facing a potential surplus, with StoneX forecasting a 422,000-tonne surplus for 2025-26 and Transgraph Consulting estimating a 415,000-tonne surplus. Despite this, supply disruptions are anticipated due to factors like farmer protests in Ivory Coast over lower prices, dry weather in parts of the country, heavy rains in Ecuador, and drought in Indonesia. Cocoa prices have reflected this volatility; December cocoa in New York closed at $5,528 a tonne on September 23, a 4.2% drop from September 17, after hitting $5,111 a day earlier.
