Friday, January 25, 2013

Cocobod upbeat about target

...despite slow start to season

Ghana Cocoa Board (Cocobod) says it is confident it will achieve its 2012-2013 crop-year harvest target of 800,000 metric tonnes, though the rains have delayed.

The rainfall pattern in the south and north of the Western Region, where around 55 percent of Ghana’s cocoa is produced, has been very bad this season -- raising fears that the harvest may be lower than projected.

“The season has started badly due to lack of rainfall. The farmers are really worried. The peak period for the rainfall has passed. This will hurt the country’s target for the season and our profits,” said an official of a Licenced Buying Company, who pleaded anonymity.

Cocobod’s Public Affairs Manager Noah Kwasi Amenyah confirmed to B&FT that though the rains did not start early, there are signs it will improve this year to enable the industry regulator attain its target.

“The signs in some parts of the cocoa-growing areas show that if we get rains it will help boost the harvest. 

“Last Tuesday’s rain was a good sign, but we hope it rained in other parts of the country’s cocoa-growing belts. If we get good rains we will get a good harvest,” he said.

Ghana operates a two-cycle cocoa year consisting of a 33-week main crop (October-June), which is mainly exported to Europe and Asia, and the minor light crop (11-week) which is discounted to local processing firms including the state-owned Cocoa Processing Company (CPC).

The main season, which opened in October last year, is getting off to a slow start and is being closely monitored by international traders.

Cocoa purchases for the 2012-13 season reached 209,400 tonnes by Nov. 8th -- down 31 percent on the year according to Cocobod figures.

Ghana produced an unprecedented one million tonnes of cocoa during the 2010-11 crop-year thanks to good weather and improved farming techniques, but production declined to about 850,000 tonnes last season. 

Cocobod said cocoa production tends to fall slightly after a bumper year. It expects to purchase 800,000 tonnes for both main and light crops in the ongoing crop-year. 

The government in October last year announced a marginal increase in the producer price of cocoa for the 2012/13 season, despite a more-than-10 percent slump in the world price of the crop in the 12-month period to that announcement. 

The producer price was reviewed upwards by 3.4 percent, from GHȼ3,280 to GHȼ3,392 per tonne.
A bag of cocoa beans is currently sold at GHȼ212, from GHȼ205 previously, representing 78.42% of the net Free on Board (FOB) value of the crop.

Government also reduced its share of the 2012/13 cocoa export duty drastically in order to raise the producer price paid to farmers. Farmers were faced with declining world cocoa prices from US$3,000 in 2011/12 to US$2,300 in 2012/13.

In addition to the higher producer price, farmers will continue to benefit from free improved seedlings, mass-spraying, and rehabilitation of farms as well as scholarships for their children.

Ghana is the second-biggest producer of cocoa in the world, with an estimated 800,000 people said to benefit directly from cocoa production.

Miners, communities tussle over compensation

The Minerals Commission says disagreements concerning payment of compensation to persons whose assets have been affected by mining activities have become a major problem in the industry.

“There have been instances of disagreements, misunderstandings and mistrust between the traditional authorities and mining communities on one side and the mining companies on the other, as a result of inadequate payment of compensation to the beneficiaries.

“The new minerals and mining compensation and resettlement regulations, LI 2175, prescribes compensation payments for lands, crops and buildings affected by min­ing,” said Isaac Abraham, Head of Public Relations at the Commission.

He said LI 2175 stipulates that “the owner or lawful occupier of any land subject to a mineral right is entitled to, and may claim from the holder of the mineral right, compensation for the disturbance of the right of the owner or occupier…”

But, he added, some chiefs and opinion leaders of mining communities sometimes go behind the rules enshrined in the LI to renegotiate with different terms -- sometimes leading to conflicts with mining companies.

The Catchment Areas Farmers Association in the Western Region recently called for transparent and scientific rules and procedures for the determination and payment of compensation to farmers affected by mining.

According to the Association, a study by Cesult Consult Service in 30 mining communities in the Western Region has found that the current policy for determining the value of crops and farms affected by mining is not transparent and scientific enough.

Farmers spend fortunes to establish their farms but receive little compensation after their farms have been displaced by mining activities, leading to the loss of property and revenue, it said.

The Association criticised weaknesses in existing laws and regulations for the compensation of people displaced by mining.

Mr. Raphael Kwasi Fordah, Chairman of the Association, in an interview with B&FT explained that there is no universal model of what could be accepted as adequate paid compensation.

He said the study by Cesult found that gold mining activities have since the late 1980s been the major cause of displacement of people, who are politically weak compared with mining companies that have the support of governments and politicians.

“The study revealed that the majority of respondents did not have a strong educational background that could have aided them in any meaningful negotiation with their richer claimants. Given their educational background – middle-school certificate holders -- it is apparent that outside interference may have crept into negotiations with their richer claimants.”

He said institutions such as the Lands Valuation Board must be encouraged to institute valuation mechanisms that will guarantee the appropriate values for both tangible and intangibles assets of individuals and communities in matters of expropriation by richer claimants.

He pointed out that whereas there are no strong expropriation laws in Ghana, the expropriation laws of India, for example, have explicit models to facilitate the payment of compensation where necessary.

“These expropriation models could be grafted onto the ones operational in Ghana to ensure fair and adequate paid compensation,” he said.

Besides being the only medium by which conflicts arising from involuntary displacement and resettlement can be resolved, adequate paid compensation can enhance the opportunities of individuals and communities to improve their standard of living -- by increasing their degree of access to social infrastructure such as quality education, health care, water and sanitation.

Cargo throughput up by 10%

Cargo throughput increased by 10 percent in 2012, rising from 18 million tonnes in 2011 to 19.7 million tonnes, Chief Executive Officer of the Ghana Shippers’ Authority (GSA) Dr. Kofi Mbiah has disclosed.
He said the Authority observed that during an election year exporters and importers adopt a wait-and-see attitude which usually leads to a possible reduction in cargo throughput, but added that the situation was not experienced in 2012.

“The Authority was able to promote and protect the interest of exporters and importers in the country through various means; such as resolution of shippers’ complaints, providing information to shippers through its publications, and collaborating with the private sector to develop infrastructure for the benefit of the shippers.

“Our benchmark for the resolution of shippers’ complaints was to resolve 80 percent of the complaints shippers bring before the Authority. Out of the numerous complaints we received for the year 2012, such as high clearing charges and damage to cargo, we were able to resolve about 90 percent, with the remaining 10 percent at various stages of investigation and resolution.

“In our bid to reach out to shippers in all parts of the country, we have established the Shipper Complaints and Support Unit at strategic locations to provide assistance to shippers at the borders. 

We have such centres at Elubo, Aflao, Kotoka International Airport, and Takoradi Port,” he said.
Dr. Mbiah outlined some infrastructural projects currently ongoing which, when completed, will address the concerns of industry players.

“The construction of Accra Shippers’ Centre is near completion and is expected to house the headquarters of GSA, and also serve as a brokerage hall and a one-stop shop for players in the maritime industry.

“In addition, the Takoradi logistics platform, which is near completion, is expected to provide a warehousing facility for the oil and gas sector,” he said.

Dr. Mbiah said the Authority faces a challenge wherein shippers tender fictitious documents to the Destination Inspection Agencies; and when these are detected, the shipper has to start the entire process again, thereby defeating the purpose of fast clearance. 

This, he said, leads to unnecessary delays that cause decongestion at the ports, and the shipper in most cases ends up paying rent and demurrage charges which could have been avoided.

He added that the GSA will intensify its shipper education drive with special focus on the small-scale importers and exporters; such as the spare-parts dealers, importers of electrical appliances, and mango, pineapple, and shea-butter exporters.

Producer inflation surges to 17%

Annualised producer price inflation rose to 17.1 percent in December from 15.8 percent the previous month, led by rising gold prices, the Ghana Statistical Service (GSS) has said.
Spot gold was little changed at US$1,691.84 an ounce early on Wednesday after hitting a one-month high of US$1,695.76 in the previous session.

Mr. Baah Wadieh, acting Deputy Government Statistician, at a media conference in Accra said: “On the year-on-year inflation rate for the three sectors, the mining and quarrying sector recorded the highest inflation rate of 27.6 percent, an increase of 8 percentage points over the November 2012 rate of 19.6 percent.

“Manufacturing inflation, which constitutes more than two-thirds of the producer-inflation basket, increased slightly to 19.3 percent from a rate of 19 percent in November.”

From January to May 2012, producer inflation fluctuated between 15 percent and 16.6 percent, thereafter rising significantly to 19 percent in July 2012 before dropping to 17.8 percent in August.

It declined again in September but increased to 19.1 percent in October, further dropping in November to 15.8 percent.

In December, five out of the 16 major groups in the manufacturing subsector recorded inflation rates higher than the sector average of 19.3 percent.

Manufacture of textiles recorded the highest inflation rate (40.1 percent) while manufacture of machinery and equipment recorded no change.

Chirano Gold Mines hopeful of 2013

Chirano Gold Mines Limited (CGML) says it expect 2013 to be an exciting year as it embark on open pit operations in May to create more job for the youth in the community. 

“We predicted that 2013 would be an exciting year as we go into open pit operations in May and hope to create more job openings, particularly for the youth in the area.” Said Mr. Ken Norris, the General Manager of CGML at a media conference at the mine site, Akoti-Etwebo in the Bibiani-Anhwiaso-Bekwai District, to announce the company’s production result said: “CGML poured 292,534 ounces of gold last year, exceeding its projected production target by about two percent. It estimated to dig out 287,178 ounces of gold during the period

“The achievement was the result of teamwork, operational efficiency and high quality of the ore.”

CGML, which is 90 per cent owned by Kinross Gold Corporation (KGC) based in Canada with the government of Ghana holding a 10 per cent carried interest, presently employs about 720 people.

Mr. Norris said: “Providing employment to majority of the young people was a priority and that they would do everything to assist them to acquire skills which would enable them to compete in our job environment”.

“Already some are being sponsored at the Obuasi Anglogold Mine Training School, while others are receiving training at various locations on our site”.

Explaining the company’s determination to maintain high standards of environmental safety and to progressively restore all mined areas, Mr. Norris said: “We have an entire department in the United States of America (USA), seeing to it that, they keep to international best practices.”

He indicated that the mine is mindful about their social impact and have been working hard to assist transform and significantly improve the lives of the population.

He disclosed that in 2012, the mines’ total expenditure on community development projects came to US$3,355,034.00.
This involved the construction of classroom blocks, teachers’ accommodation, Information Communication Technology (ICT) centres, health, water, and sanitation infrastructure.

Akoti, Etwebo, Akaaso, New Obrayeko, Lawerkrom, Kwaanikrom, Paboase, Subri, Kunkumso, Surano, Anyinasie, Atiakrom, Ntrentreso, Nsonyameye and Baako-Nka were among the beneficiary communities.