The Liberia National Cocoa and Coffee Exporter Association (LINACEA) on Friday, October 23, released a buying price for the cocoa supplied at farm gates around the country.
A statement signed and approved by its General Secretary, Mr. Stanley Slagmolen and Mr. Sheik Abu Turay, Chairman, declared that the regulation applies to grade one (1) cocoa.
According to LINACEA, the farm gate price is US$1.50 per kilogram, equivalent to L$1,500 per metric ton. However, the exporters association noted that delivery to any warehouse in Monrovia (at the expense of the farmer) is US$1.65 per kilogram or L$1,650 per metric ton.
“We will update the prices on a monthly basis. The present prices expire on October 31, 2020. We will work to improve the Liberia cocoa sector,” the release said.
The release further said that LINACEA would pay for the cocoa supplied to any warehouse in Monrovia.
The release indicated that the association will work to ensure that farm gate prices paid is not less than 65 percent of prevailing world market prices and updated monthly.
Cocoa is the third most important cash crop in Liberia where about 30,000 Liberian smallholder farmers are engaged in the production of the crop, according to statistics from the National Investment Commision (NIC).
LINACEA said the new measure is due to the significant decline of the commodity on the world market. However, global prices suggest that, while there may have been a decline in prices this year, cocoa is still doing much better on average than it did in 2019.
According to the International Cocoa Organization (ICCO) the global price of Cocoa peaked early this year in February, at the rate of US$2,716.21 per ton, up from US$2,603.07 in January, before taking a fluctuating decline to as low as US$2,101.74 in July. But in August, the commodity rebounded with a US$247 spike, which brought the price up to US$2,348.68, with a modest increase in September, at US$2,457.90. Whether the price will reach its February peak again before the end of 2020 remains to be seen. Year-over-year, cocoa has performed better so far in 2020 than in 2019, when the highest prices were for October (US$2,435.27), November (US$2,519.66, peak), and December (US$2,444.71).
Stakeholders in the cocoa sector have said that cocoa bean production in Liberia is estimated to be between 7,000 to 17,000 metric tons yearly, with an unknown amount of cocoa beans being informally exported to Cote D’Ivoire, Sierra Leone and Guinea.
Meanwhile, the Liberia Agriculture Commodity Regulatory Authority (LACRA) has condemned LINACEA for deriving a farm gate price for cocoa in the country.
Speaking to the Daily Observer via mobile phone yesterday evening, the Communication Director of LACRA, Gordon Gaway said that no cocoa exporter is clothed with the authority to regulate the price of cocoa in the country except LACRA.
According to Garway, his institution is expected to come up with a press statement today (Monday, October 26) to explain to the public about the situation confronting the cocoa market and measures taken by LCRA to put it under control.