Grenada Cocoa Association receives government bailout

by Curlan Campbell, NOW Grenada

  • Government allocates EC$1.5 million to GCA
  • Depressing prices on the world market mean the GCA receives $1,900 per ton for cocoa

For the last 4 weeks, as a result of cash flow issues, the Grenada Cocoa Association (GCA) was only able to purchase from farmers dry cocoa as opposed to wet cocoa.

However, with the financial help from government of EC$1.5 million in February, the association announced that the purchase of wet cocoa will once again resume on Tuesday, 20 February. The recent financial bailout for the association came after it had already received EC$1 million from government last December.

GCA accountant, Samuel Braithwaite said fluctuating prices on the global market contributed to their cash flow issues, since in this sector in particular despite receiving a low price for cocoa on the world market, the association still continued to offer the same price to farmers. He said although farmers were willing to take a reduction in price, government stepped in to ensure that the price for farmers was maintained through the EC$1.5 million allocation.

“The challenge we face basically is the situation where the price for cocoa will fluctuate on the world market. In a normal business with fluctuating prices, the business will. pay farmers accordingly, but in the cocoa association we try to maintain a price for farmers. Selling cocoa alone is difficult and that’s why government came in to help us because the farmers themselves decided to take a reduction, but when we went to the government, government said we would not want you to do this.”

Braithwaite said a long-term solution is being sought to ensure that the association is not affected by cash flow issues. “How do you deal with this situation long-term? One [way] is to increase agro-processing, and we have started with Diamond chocolate factory so that we can process more of our cocoa locally. At this point the amount we process — about 10,000 pounds per month — is small, but we have been increasing because we [have] moved from a situation in the first year where we were processing 4,000 pounds per month to now processing between 10 to 15,000 pounds per month.”

At present, depressing prices on the world market mean the GCA receives $1,900 per ton for cocoa. This is a drastic decline for the association which, in favourable times would have received between $3,600 to $4,600 per ton.

As a result, the GCA is continually exploring new international markets outside of its traditional major trading partners including the UK and the United States. Meanwhile, farmers can expect to sell cocoa on Tuesday, 20 February at Carlton Cocoa Station, Grand Bra, St Andrew and Mt Horne, Bellevue in St David on Wednesday 21 February; Pointsfield, St Patrick on Thursday and the following Thursday at Diamond and upper St John.

Article Footer 468x60

Facebook Comments

Comment with your Email or Facebook login:

avatar

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Related Posts