Ghana’s cocoa output for 2010-11 season attributed to smuggling from Ivory Coast – Report

Analysts have attributed Ghana’s cocoa boost in the 2010-11 season to smuggling from strife stricken Ivory Coast, the Reuters news service has reported.

But Ghana Cocobod officials say it is as a result of strategy to improve crop yield and good weather.

According to the report, more than two-thirds of Ghana’s increase in cocoa output this season comes from what they describe as a reversal of smuggling flow between the country and Ivory Coast, and casting doubt on the country’s agricultural success story as the world’s second largest producer of cocoa.

According to Reuters, Ghana expects official output of around 920,000 tonnes, which is a surge from the 632,000 tonnes posted last season.

The report cites Ghanaian officials as attributing the increase to new farming techniques and good weather.

However, the report also cited analysts saying a reversal of smuggling flows with Ivory Coast could make up about 200,000 tonnes of the year-on year change.

Citing shippers and analysts the Reuters indicated that some 100,000 tonnes of cocoa beans have been smuggled from Ivory Coast into Ghana following the violent post-election power struggle between Laurent Gbagbo and Alassane Ouattara, which also froze exports for months, a year after the same volume was smuggled from Ghana into the Ivory Coast.

The report quoted Cole Martin of Business Monitor International saying,”Normally you would see cocoa being smuggled from Ghana to Ivory Coast, because of the price difference.” He also added that this year he expected some 100,000 tonnes had crossed the other way.

Two purchases directors for cocoa export companies — one based in Ivory Coast and the other in Ghana — said the Ghana-bound smuggling from Ivory Coast amounted to at least 100,000 tonnes this season, the report said.

“We are aware of the traffic, and we estimate between 100,000 and 150,000 tonnes of beans have crossed over so far,” it quoted one of the exporters as saying.

The Deputy Chief Executive of the Ghana Cocobod was however quoted as saying about the smuggling,“We don’t have an official figure but all we know is that it is very, very insignificant.”

On how the country increased produce for the season he said, “We started implementing a new strategy to improve the crop more than three years ago and now we are seeing the results. Fortunately, for us, the weather has also been very good.”

Cocoa is Ghana’s major foreign exchange earner.

According to the Bank of Ghana, provisional data on the external sector indicates that Ghana’s total merchandise exports for the first quarter of 2010 amounted to $1.7 billion, a growth of 20.9% on year-on-year basis and cocoa beans and products earned $704.1 million dollars, an increase of 28.5%.

By Emmanuel K. Dogbevi