Cocoa Farmers Face Crisis as Smuggling and Land Sales to Illegal Miners Rise Amid Three-Month Payment Arrears

Introduction

Ghana’s cocoa industry is grappling with a deepening crisis as thousands of farmers across the Ashanti region and beyond face severe financial hardship due to a three-month delay in payments from the Ghana Cocoa Board (COCOBOD). The situation has pushed some desperate farmers to consider smuggling their cocoa beans to neighboring countries and selling their farmland to illegal miners. This article explores the causes, consequences, and potential solutions to this escalating problem that threatens the backbone of Ghana’s agricultural economy.

Key Points

Background

The current crisis stems from a combination of factors that have converged to create an unprecedented payment backlog. In October 2025, the Ghanaian government announced a significant increase in the farmgate price for cocoa, setting it at 58,000 cedis per metric tonne. This decision was initially welcomed by farmers who hoped it would improve their livelihoods. However, the price adjustment came with a new cocoa financing regime that COCOBOD implemented without securing the traditional syndicated loans that had previously supported the purchasing system.

Under the new model, farmers sell their beans to licensed buying companies (LBCs), which then sell to COCOBOD. The state-owned board subsequently sells the cocoa to multinational buyers. This chain has been disrupted because COCOBOD has been unable to secure advance payments from international buyers due to declining global cocoa prices. Data from the Bank of Ghana shows cocoa trading at approximately $5,800 per tonne as of December 2025, down from over $11,000 earlier in the year.

Analysis

The financial strain on farmers has become severe. David Berko and his wife, who have farmed cocoa for nearly three decades in the Kofiase community of the Ashanti region, exemplify the struggle. After three months without payment, they find themselves unable to afford basic necessities, let alone pay school fees for their children. David’s wife explained, “Yesterday we ate ampesi. This morning, we have no cash on us for food. The purchasing clerk told us to come for the money. But when my husband went there, he told him, there isn’t any now. We’ve been chasing the money since.”

The crisis has pushed some farmers to consider extreme measures. Nana, another cocoa farmer, expressed frustration with the government’s apparent lack of concern: “This government cares less about the cocoa sector. We’ve never been in this situation before.” Some farmers are now threatening to sell their land to illegal miners or smuggle their cocoa to neighboring countries where they might receive better prices. These desperate actions could have devastating long-term consequences for Ghana’s cocoa industry and environmental sustainability.

Professor Robert Aidoo, an agricultural economist at KNUST, warns that while maximizing international market returns is important, it should not come at the expense of farmer welfare. He suggests that the government could utilize revenues from its gold program to pay farmers while waiting for better cocoa prices. The current situation puts both farmer livelihoods and the entire cocoa value chain at risk.

Practical Advice

For farmers currently facing payment delays, several steps may help mitigate the crisis:

1. **Form cooperatives** – Farmers should organize into stronger groups to increase their bargaining power and share resources during difficult periods.

2. **Diversify income sources** – While waiting for cocoa payments, farmers can explore intercropping or other agricultural activities to generate immediate income.

3. **Document all transactions** – Maintain detailed records of cocoa sales, including receipts and communication with buying companies, to strengthen claims for payment.

4. **Engage with local authorities** – Farmers should report payment delays to district agricultural offices and local government representatives who may advocate on their behalf.

5. **Explore microfinance options** – While caution is needed with interest rates, some microfinance institutions offer emergency loans specifically for agricultural producers.

For policymakers, addressing the crisis requires immediate action:

1. **Emergency funding** – The government should allocate emergency funds to clear the payment backlog and restore farmer confidence.

2. **Review financing models** – COCOBOD needs to reassess its current financing approach and consider hybrid models that balance international market optimization with farmer welfare.

3. **Strengthen farmer support systems** – Establish more robust social safety nets for farmers during market downturns.

4. **Combat illegal mining** – Intensify efforts to prevent illegal mining on agricultural lands, which threatens both the environment and food security.

FAQ

Conclusion

The three-month payment arrears facing Ghana’s cocoa farmers represent a critical juncture for the country’s agricultural sector. The crisis has exposed vulnerabilities in the cocoa financing system and threatens to undermine decades of progress in the industry. While the government’s intention to optimize international cocoa prices is understandable from an economic perspective, the current approach has placed an unsustainable burden on farmers who are the foundation of the cocoa value chain.

The consideration of smuggling and selling land to illegal miners by desperate farmers should serve as a wake-up call to policymakers. These are not merely economic choices but survival strategies for families who have dedicated their lives to cocoa farming. The situation demands immediate intervention to clear payment backlogs, review the financing model, and implement stronger protections for farmers during market downturns.

Ghana’s cocoa industry has been a source of national pride and economic stability for generations. Preserving this legacy requires balancing market optimization with farmer welfare, ensuring that those who work the land receive timely compensation for their labor. The current crisis offers an opportunity to strengthen the cocoa sector through reforms that create a more resilient and equitable system for all stakeholders involved.