The entire supply chain of the Ghana Cocoa Board (COCOBOD) has come under challenge following the outbreak and rapid spread of the COVID-19 pandemic worldwide. In recognition of the importance of cocoa to the economy of Ghana, COCOBOD was exempted from the partial lockdown of Greater Accra, Tema, and Greater Kumasi as announced by the President on 27th March 2020. While work continues, management has put the following contingency measures in place to deal with the possible challenges at each stage of the cocoa supply chain as efforts are made to contain the pandemic:
COCOBOD Corporate Head Office in Accra
The Head Office has been decongested by reducing the number of staff of each department to only critical and essential staff to ensure the continuous and effective running of the administration of COCOBOD. Provisions have been made for PPEs and compulsory hand and respiratory hygiene for all critical staff who continue to report to the office for work during the lockdown period. Temperatures of staff are checked every morning using gun thermometers before they are allowed to enter the Corporate Head premises for work.
THE FARMER:
Educational materials on social distancing and practice of hand and respiratory hygiene have been designed for the guidance of cocoa farmers in the hinterlands. This is supplemented with Television and radio announcements in the local dialect to further educate farmers to observe the necessary health protocols. District Cocoa Officers have been mandated to ensure that social distancing measures and COVID-19 spread prevention actions are followed by farmers.
COCOA HEALTH AND EXTENSION DIVISION (CHED):
Staff has been asked to engage farmers in smaller groups. Management has supplied field staff with personal protective equipment (PPEs) such as nose masks, hand gloves, and hazardous material (hazmat) clothing and encourages hand and respiratory hygiene. Staff has been decongested at the Head Office, Regional Offices and District Offices. Monthly technical meetings at the District Offices and the Regional Offices have been suspended indefinitely. The District Offices and the Regional Offices use Social Media in disseminating information. All correspondence between the Regional Offices and the Head Office is via e-mail. Additionally, CHED’s Management Committee Meetings have been suspended. All the 62 District Offices, Regional Offices, and the Head Office have been supplied with electronic thermometer guns, hand washing kits, and hand sanitizers.
COCOA DISEASES AND PESTS CONTROL – CODAPEC/HI-TECH:
Management conventionally provides protective clothing to staff involved in spraying activities in the form of full-face masks, hand gloves, Wellington boots and overalls and this hasn’t changed. Staff has subsequently been educated to practice social distancing and other COVID-19 preventive measures. Personnel involved in the Hi-tech program are further provided with nose masks, hand gloves, and protective clothing to stem the potential spread of the virus.
LICENSED BUYING COMPANIES (LBCs)/PURCHASING CLERKS:
Purchasing clerks buy cocoa on society level individually and separately from farmers rather than in large farmer groups and this hasn’t changed. COCOBOD, as part of stakeholder sensitization programs, engages LBCs at all levels of their operations on the adoption of COVID-19 containment measures.
QUALITY CONTROL COMPANY (QCC) LIMITED:
The maximum number of staff involved in grading and sealing activities at a time is usually two persons. For the contingency plan in the face of COVID-19, most of the graders have been made to remain at home until their services are required
COCOA MARKETING COMPANY (CMC) LIMITED:
Staff at the takeover centers involved in the receipts of cocoa from LBCs work in groups of less than six to ensure that social distancing protocols are adhered to. Where the full complement of staff is not required at a time, staff is made to work in shifts to ensure that operations do not stall.
STAKEHOLDERS:
International and Local Banks:
COCOBOD deals with the Central Bank of Ghana for various banking services related to international transfers of cocoa proceeds and also interface with local commercial Banks for general banking transactions. Relationship with international Banks involves syndicated loan arrangements and related transactions.
Contingency Plan:
COCOBOD continues to engage with all its relationship Banks (local and international) through various technological means including e-mails and conference calls. This mode of communication has not been affected by the pandemic. All transactions and discussions with relationship Banks are continuing.
Cocoa Buyers:
Cocoa Marketing Company (CMC), a subsidiary of COCOBOD undertakes the warehousing, sale, and collection of cocoa proceeds on behalf of COCOBOD. The sales are carried out mainly through forward and spot sales arrangements with both local and international buyers.
Contingency Plan:
The COVID-19 pandemic has taken its toll on the international cocoa market leading to a slump in demand and consequently falls in the price of cocoa. However, CMC relies on the occasional spike in the price of cocoa on the international market to take advantage of establishing sales contracts. Measures have been taken to ensure that declared shipments from buyers are honored without default through the efficient work programming described under CMC’s operations.
Government/Sector Ministry:
COCOBOD falls under the Ministry of Food and Agriculture (MOFA) as the supervising Ministry providing direction for COCOBOD in respect of Government policy on cocoa. All matters relating to the finances of COCOBOD are channeled through MOFA for the attention of the Finance Ministry.
Contingency Plan: With the outbreak of the COVID-19 pandemic, COCOBOD is in constant discussions with both Ministries on the operational and financial situation of the cocoa industry in Ghana. A case in point is the Government’s exemption of COCOBOD from the partial lockdown currently in place enabling COCOBOD to carry out its mandated duties as an essential service provider to the economy.
Syndication Loan 2019/2020 Facility:
For the 2019/2020 syndicated loan facility of US$1.3 billion was fully drawn by December 2019. The repayment of the facility commenced in February 2020. Currently, repayments for February and March 2020 have been discharged with no challenges.
2020/2021 Facility: An RFP has been forwarded to international and local financial institutions inviting bids for the 2020/2021 loan facility arrangement. The deadline for the submission was extended by one month to 15th May 2020 following the widespread outbreak of the coronavirus at the global scene.
For the 2019/2020 Facility, CMC has managed to secure enough collections into the Trustee Collections Account to secure successful repayment of the outstanding facility amount as a result of alternative collection arrangements made with buyers, the collection and the facility agents.
Facility:
In respect of the 2020/2021 facility, COCOBOD is in discussion with relationship Banks regarding the successful mode of securing finance for the 2020/2021 cocoa season. The ultimate decision to take in this direction will be communicated to relevant stakeholders after consultation with the Board and the Ministries of Food and Agriculture and Finance.
CONCLUSION
The effect of COVID-19 has been far-reaching but COCOBOD has carefully analyzed the situation and taken the necessary steps that will protect human lives within the cocoa value chain as well as protecting the economic interest of the industry stakeholders despite the uncertainty of income as a result of the pandemic.
Source: Mybrytfmonline.com
