2.1.1 Ecology, production, labor and land
Originally, cocoa was mainly cultivated in the tropical rainforests in South America. Once established in Ghana, cocoa production expanded rapidly in Africa and by the mid 1920s,
WCA has become the main producer. Cocoa grows naturally in tropical rain forests. This habitat provides heavy shade and rainfall, uniform temperature and constant relative humidity and is typically only found within 10º of the equator. There are basically three group types of cocoa grown: Criollo, Forestaro and Trinitario (a cross between Criollo and Forestaro). Each type has its own characteristics of growth vigour, fermentation requirements, disease susceptibility and fat content. Forestaro is the most commonly grown comprising …show more content…
The market structure for inputs in is typically monopolistic and prices rarely reflect actual scarcity because of subsidies and rationing. Input market integration is low and constant availability is problematic; therefore, the use of purchased production input is limited (Hatting et al., 1998).
The time required to achieve a return in agriculture is a problem for loaning (Unruh and
Turray, 2006). With the exception of annual crops, such as rice cultivation, banks are generally unwilling to make loans for agricultural improvements that may take long time to realize a return, due to the perceived excessive risk. Thus loans for irrigation, drainage facilities, levelling fields, tree crops, the construction of processing facilities, and farm equipment are not usually considered for loaning arrangements.
Choices for collateral can also be problematic. In Sierra Leone, bank personnel note that the problem with loaning and using a land lease as part of a “bankable project” for collateral is not that of tenure security (Unruh and Turray, 2006). Although there is little …show more content…
Domestic exporters and traders who buy cocoa from farmers and transport it to ports depended on their own resources or bank credit to finance their operations, but most domestic banks are unable to finance cocoa traders. A financing innovation that has evolved since the liberalization in
Ghana is called the green clause letter of credit but was available only to traders that already had enough money to transport a truckload of cocoa beans to Douala and store them in a warehouse (Varangis and Schreiber, 2001). The trader then took the warehouse receipt to a bank, which issued a letter of credit against the stored beans. The buyer then advanced 70 percent of the value of the stored crop for the trader to purchase more cocoa.
In cocoa and coffee plantations, just like in most other farming systems in WCA, land tenure issues are complex and are thus addressed now. Most of these countries are in conflict or are recently post conflict. For this reason, according to Unruh and Turray (2006), administering rural return or access after or during a conflict is a complicated and time consuming function that requires much local knowledge, legitimacy and authority. The chieftaincy
Originally, cocoa was mainly cultivated in the tropical rainforests in South America. Once established in Ghana, cocoa production expanded rapidly in Africa and by the mid 1920s,
WCA has become the main producer. Cocoa grows naturally in tropical rain forests. This habitat provides heavy shade and rainfall, uniform temperature and constant relative humidity and is typically only found within 10º of the equator. There are basically three group types of cocoa grown: Criollo, Forestaro and Trinitario (a cross between Criollo and Forestaro). Each type has its own characteristics of growth vigour, fermentation requirements, disease susceptibility and fat content. Forestaro is the most commonly grown comprising …show more content…
The market structure for inputs in is typically monopolistic and prices rarely reflect actual scarcity because of subsidies and rationing. Input market integration is low and constant availability is problematic; therefore, the use of purchased production input is limited (Hatting et al., 1998).
The time required to achieve a return in agriculture is a problem for loaning (Unruh and
Turray, 2006). With the exception of annual crops, such as rice cultivation, banks are generally unwilling to make loans for agricultural improvements that may take long time to realize a return, due to the perceived excessive risk. Thus loans for irrigation, drainage facilities, levelling fields, tree crops, the construction of processing facilities, and farm equipment are not usually considered for loaning arrangements.
Choices for collateral can also be problematic. In Sierra Leone, bank personnel note that the problem with loaning and using a land lease as part of a “bankable project” for collateral is not that of tenure security (Unruh and Turray, 2006). Although there is little …show more content…
Domestic exporters and traders who buy cocoa from farmers and transport it to ports depended on their own resources or bank credit to finance their operations, but most domestic banks are unable to finance cocoa traders. A financing innovation that has evolved since the liberalization in
Ghana is called the green clause letter of credit but was available only to traders that already had enough money to transport a truckload of cocoa beans to Douala and store them in a warehouse (Varangis and Schreiber, 2001). The trader then took the warehouse receipt to a bank, which issued a letter of credit against the stored beans. The buyer then advanced 70 percent of the value of the stored crop for the trader to purchase more cocoa.
In cocoa and coffee plantations, just like in most other farming systems in WCA, land tenure issues are complex and are thus addressed now. Most of these countries are in conflict or are recently post conflict. For this reason, according to Unruh and Turray (2006), administering rural return or access after or during a conflict is a complicated and time consuming function that requires much local knowledge, legitimacy and authority. The chieftaincy