Ghana’s cocoa regulator plans to raise $750 million in loans to finance the replacement of almost half of the trees that produce the crop in the country because they are either old or ridden with disease.
Bloomberg reports that Ghana Cocoa Board wants to cut down more than 400,000 hectares (988,431 acres) of trees over the next five to eight years, Joseph Boahen Aidoo, Chief Executive Officer said on Monday. About a fifth of Ghana’s cocoa tree stock is affected by swollen shoot disease, a virus which reduces yields and kills a plant within three to four years, while another quarter are old and unproductive, Aidoo said.
“The spread of the disease is quite alarming, even young farms have been affected,” Aidoo said in an interview in the capital, Accra. The measures will not affect Ghana’s forecast of 850,000 tons of cocoa for the season through September and will boost the size of future harvests, he said.
The loan facility will be raised from local and foreign banks and is expected to be completed early next year, he said.
The industry regulator is seeking to improve yields and incomes of thousands of small-holder farmers who dominate the industry in the world’s second-biggest producer of the chocolate ingredient. Plans to raise a $750 million loan will be in addition to expected borrowings of $600 million from the African Development Bank for the building of warehouses and other measures to improve storage and distribution of the crop.