@article{Victor:97085,
      recid = {97085},
      author = {Victor, Afari-Sefa and Gockowski, James and Agyeman, Nana  Fredua and Dziwornu, Ambrose K.},
      title = {ECONOMIC COST-BENEFIT ANALYSIS OF CERTIFIED SUSTAINABLE  COCOA PRODUCTION IN GHANA},
      address = {2010-09},
      number = {308-2016-5113},
      pages = {20},
      year = {2010},
      abstract = {Ghana is well endowed with premium bulk cocoa and is  strategically positioned to capture
significant market  shares for the growing demand in specialty cocoa products  on the world
market. Consumers’ taste and preference for  differentiated or ‘specialty’ cocoa based on
environmental-  and ethically certified cocoa products have been rising  over the years. This
study uses an ex-ante analytical  approach to explore the potential for smallholder  cocoa
farmers in Ghana to develop niche markets for an  environmentally and sustainably produced
cocoa, namely;  Rainforest Alliance Certified cocoa as an alternative to  Ghanaian bulk cocoa.
Using NPV, BCR and IRR economic  decision criteria, the profitability or otherwise  of
introducing this rainforest alliance certified cocoa in  Ghana is assessed. Rainforest Alliance
certification  requires farmers to shift from low or no shade Amazon  production systems (i.e.,
<20 trees per ha) to medium shade  Amazon production systems (70 shade trees distributed
over  a minimum of 12 species per ha) as well as other standards.  In the base case scenario,
results of the hypothetical high  certified production system are compared with the current  low
input landrace cocoa and high input no shade cocoa  systems. Under these conditions the
certified production  system and the low input landrace cocoa are essentially  breakeven
propositions while the high technology full sun  system was moderately profitable. Sensitivity
analysis of  changes in FOB shares revealed that increasing the  percentage of producer price
from 70 to 85 percent of FOB  dramatically increases the profitability of Rainforest  Alliance
certified cocoa at all varying FOB price levels  when fertilizer price is subsidized. Profitability
did  however not change from the base model when fertilizer  subsidies are removed by the
government and the producer  price increases to 85 percent of FOB.},
      url = {http://ageconsearch.umn.edu/record/97085},
      doi = {https://doi.org/10.22004/ag.econ.97085},
}