Cocoa purchases up, price hike seen

Cocoa purchases declared by buyers to Ghana's industry regulator Cocobod totalled 378,738 tonnes by December 24, up 0.5 percent on the previous season, according to Cocobod data seen by Reuters on Wednesday.

The 2009/10 season in the world's second biggest cocoa grower began on October 16.

Though the December 24 figure representing the first 10 weeks of the season was up, industry sources said they expected purchases since then to be much lower, as farmers have held onto beans in expectation of higher producer prices as set by the government.

"Weekly returns have been sluggish over the past weeks ... indications are that the farmers are withholding the beans in expectation of new producer prices," one source said.

Ghana pays 2,208 cedis to farmers for a tonne of cocoa, a price set before the start of the season, but some within the industry say the country has been losing its cocoa to smuggling, mainly via traders from neighbouring Ivory Coast offering higher prices.

Finance Minister Kwabena Duffuor told Reuters on Tuesday a committee tasked with fixing producer prices met last week.

"We ... made some recommendations to the president who is the final authority," Duffuor said, without elaborating on the recommendation.