Officials of the Ghana Export Promotion Authority (GEPA) have opened a series of stakeholder discussions with representatives of COCOBOD and key industry players in the cocoa sector to institute policy frameworks that will lead to increasing the quantity of cocoa beans sold to chocolate manufacturing companies to enhance Ghana’s competitiveness and market share in the export of chocolate in the global market.
Currently, the quantity of cocoa beans COCOBOD sells to local processors during the major and minor crop seasons is said to be less than 30 percent of the country’s annual crop production.
Goldstreet Business gathered that most chocolate companies prefer buying the cocoa beans during the minor crop season as against the main season. This is because the minor season crop beans are sold at a certain discounted price which also comes with other additional benefits to the companies with the result that a number of such companies buy less of the cocoa beans during the main crop season.
“There is an international price for the cocoa beans as against what the companies here want to pay. Cocobod would not want to sell at a discounted price during the main crop season to the local companies as against what export of the raw cocoa beans will give them”, Mr. Erasmus Ashun, Director of Product Development of GEPA told the Goldstreet Business.
The engagement between the two parties is seen as necessary by industry players in the sense that it would enable Ghana to shore up its export volumes of locally made chocolate into the global market which would translate into substantially more foreign exchange earnings.
According to a report on the global chocolate market, the total chocolate market is estimated to be worth around US$110 billion and is projected to surpass US$161.56 billion in revenues generated by 2024, growing at a Compound Annual Growth Rate (CAGR) of around 7.0 percent in terms of volume.
Speaking exclusively with this paper, Head of Services and Manufacturers of GEPA, Mr. Bandah Abdallah noted that the problems facing Ghana’s chocolate industry is multifaceted as there are also challenges in terms of lack of both economies of scale and financial muscle which are needed to increase chocolate production for export.
“Market for their products is not an issue. It has to do with the availability of cocoa beans” he insisted. “In turn, this problem is about pricing. We have the main crop and minor crop seasons. With the main crop, COCOBOD prices the cocoa beans at a premium. So, the local processors would have to buy at the same world market price”, he reiterated.
The latest Competitor Analysis report from GEPA states that exports of Ghana’s chocolate to the global market in 2018 stood at US$32.1 million. This is a huge increase on the revenues gotten from the product in 2015, 2016 and 2017 at US$33,320, US$1,435,613 and US$16,806,703 respectively.
Africa produces about 75 percent of the total global cocoa production, yet it has only five percent of the entire chocolate market whereas Switzerland and Belgium – the world’s top two producers of chocolate – reportedly earn around US$14 billion and US$12 billion respectively from export of chocolate annually.
The Authority is now playing an advocacy role to ensure that supply of cocoa beans to the chocolate/cocoa manufacturers is improved as well as to enhance the value addition chain
The changing preferences of consumers is a key factor that persuades companies to focus on product development and marketing tactics to expand into a wider consumer base and capture new markets. This is driving the growth of the global market for chocolate. Different types of chocolates are produced worldwide and they include dark, milk, and white chocolate.