From Production to Export Markets: the case of the Cocoa Value Chain in Ghana

Introduction The chocolate industry is part of a multibillion dollar industry where the constant growing demand has encouraged chocolate manufactures to seek the best ingredients to satisfy the most exquisite demands (Chocosuisse 2011). Nowadays the cocoa industry has grown quickly and many companies offer a wider variety of products, where the main ingredient is this famous seed called cocoa. Therefore, a group of companies have decided to specialize in preparing semi-finished cocoa products (grinders) selling to chocolate, cosmetics, beverage manufacturers and other confectioners to produce finished added value cocoa products. Cargill, Barry Callebaut and ADM are currently the most important grinders in the world. They buy cocoa beans from traders and process them into cocoa liquor and cocoa butter to sell to chocolate manufacturers as well as to other industries (Fold 2001). Cocoa is currently found in developing countries in Africa, Central and South America and Asia. Production is concentrated on smallscale farms, of no more than four hectares, and is the main source of income for many households. Ivory Coast and Ghana are the largest producers in the world with an estimated production of 1370,000 and 675,000 tons respectively. Other main players are Indonesia, Brazil and Ecuador (Oxfam 2008). Cocoa, a major contributor to the Ghanaian economy, has won a reputation for high quality in international markets because of the work of the Board. Since 1984 the Ghana Cocoa Board (COCOBOD) has taken control of the cocoa production and market. With its subdivisions, it is in charge of providing inputs and delivering products to farmers, traders and buyers. Despite COCOBOD’s work to keep up premium prices, there is still a problem of low producer price in cocoa farming. This issue has generated concern among many organizations around the world that seek solutions to alleviate poverty and hunger in rural areas, while preserving the cocoa supply in the long run. However, the continual use of traditional agriculture with exhausted soils, combined with lack of inputs and capital, is causing low yields aggravating this problem (Gockowski et al., 2011).