CHAPTER ONE INTRODUCTION

1.1 Background

Tree crops, particularly cocoa, coffee, oil palm, and rubber, have being the main agricultural exports in Ghana. Among the tree crops, cocoa is key to Ghana’s exports (Danso-Abbeam, Addai, & Ehiakpor, 2012; ISSER, 2012). Ghana is a second producer of cocoa in the world after Cote d’Ivoire (Dormon et al., 2004). Cocoa production in Ghana is concentrated in six regions namely Ashanti, Brong-Ahafo, Central, Eastern, Western, and Volta with the three northern regions and Greater Accra not conducive for production. The main cocoa-producing region is presently the Western Region, which has been divided into two zones as a result of the high production levels, to aid better administration (Anim-Kwapong & Frimpong, 2004). The Ashanti region follows as second and then Brong Ahafo region and the fourth leading producer being the Central region. Eastern region is the fifth leading producing of cocoa in Ghana.

It is worthy to note that the Eastern region had been the leading producer of cocoa until farms were plagued with pests and diseases in the 1930s which eventually led to production declines in the region and in the nation at large (Omane-Adjepong, 2012). The region is very important in the cocoa sector because it was the first point of introduction of the crop. Since the Eastern region was the first area of introduction of the crop means majority of the cocoa trees are overgrown and passed their productive life. This has contributed to the relatively low production quantities recorded annually. To address this production shortfall, there is the need to rehabilitate old farms in the region to improve both regional and local production quantities.

In 2011, growth in the cocoa sector overtook the crop and the livestock sectors, and grew by about 14% leading to the realization of government’s target of achieving one million metric tons of cocoa production per year. By this, foreign exchange revenue realized from cocoa exports stood at 23% of the total export earnings (ISSER, 2012). Overall, the land area allocated to cocoa production is

1.6 million hectares with an average yield of about 400kg per Ha (MoFA, 2011). This production occurs in rural areas. According to Vos, Krauss, Petithuguenin, Perreira, and Nanga (2002), cocoa is an essential component of the rural livelihood system, with farmers highly committed to the cultivation of the crop. Cocoa cultivation is a way of life and farmers are very much attached to the crop socio-culturally, hence the economic and social importance of cocoa can scarcely be exaggerated. Mensah (2006) stated that there are few Ghanaians whose welfare is entirely independent on cocoa. According to Wegner (2012), around 6.3 million Ghanaians derive their source of livelihood from cocoa production, representing nearly 30% of the population. Estimates of per capita income show that households’ mean per capita daily income from cocoa was US$0.42 out of a total income of US$ 0.63 in 2008 (Mensah, 2006). This indicates that household’s heavily depend on cocoa for their livelihood.

As a result of the importance attached to the crop by farmers, Ghana is highly competitive in its production of bulk cocoa. This has been made possible by the specialized skills of farmers in producing high quality beans under hygienic and environmentally friendly conditions. Thus, Ghana’s cocoa is highly appreciated and has almost unlimited demand on the global market (Mensah, 2006). From the above discourse, it is clear that cocoa is an important and the premier cash crop both in terms of quality and bulk value.

To increase the contribution of the cocoa sector, Ghana introduced various interventions that were geared towards enhancing production, productivity and quality. Owusu and Frimpong (2014) in their research reiterated that the cocoa sub-sector in Ghana has benefited immensely from the introduction of several programmes over the years, to increase production and productivity. These programmes include the Cocoa Disease and Pest Control (CODAPEC) programme and the Cocoa Hi-TECH programme. These were technology-based programmes to address some production challenges of the cocoa sector and also have both social and economic objectives that seek to improve the income and living standards of farm families, maximize foreign exchange contribution to the economy of Ghana, reduce poverty among cocoa farmers and to encourage the youth to go into cocoa farming. These technologies consist of attributes which could eliminate the two major cocoa pests; capsids and black pod disease, and increase productivity for that matter. As a result of these programmes, COCOBOD reported an unparalleled cocoa production level of 1,004,194 MT in 2011 (Baffoe-Asare, Danquah, & Annor-Frimpong, 2013).

Besides these and other programmes implemented, government has long established institutions such as the Cocoa Research Institute of Ghana (CRIG), The Seed Production Unit (SPU) as well as the Cocoa Swollen Shoot Virus and Diseases Unit (CSSVDU) under the Ghana Cocoa Board to coordinate programmes to improve production. The primary focus of these projects and the mandates of these institutions is the rehabilitation of cocoa farms, developing cocoa hybrids resistant to field challenges like diseases and pests, raising clones and seedlings for improved production (COCOBOD & UNDP, 2013)

Despite some major achievements, the level of cocoa productivity is still below the achievable yield of 1 metric tonne per hectare (MoFA, 2011). One technology that has proven useful in addressing the challenge of low productivity is the use of side grafting technique to rehabilitate farms (Effendy, Hanani, Setiawan, & Muhaimin, 2013). Pina and Errea (2005) define grafting as the natural or deliberate fusion of plant parts so that there is vascular continuity and the resulting composite organism functions as a single plant. With this process, two adjacent intact plant parts or different branches of the same plant can become naturally or intentionally/artificially grafted together. Artificial grafting of which side grafting is an example, involves inserting a previously cut shoot or scion into an opening in another plant growing (known as the root stock). To provide suitable environment for the grafting process the rootstock which is also referred to as the understock must be in its active growth phase (Mudge, Janick, Scoffield, & Goldschmidt, 2009). This method has various uses such as vegetative propagation, cultivar change, avoidance of juvenility, repair, size control as well as biotic and abiotic resistance. Grafting has been introduced in the cocoa sector in many countries to improve yield and help plants to develop resistant varieties (Vos, Ritchie, & Flood, 2003).

The Seed Production Unit in Ghana produces grafted seedlings from improved varieties obtained from CRIG and markets them to farmers for onward cultivation. This process involves top grafting improved varieties on resistant rootstock. Farmers can then obtain these top grafted plants or purchase pods at a low price from seed gardens scattered throughout the six cocoa growing regions, and nurse them for later transplant. These grafted plants are however good for starting new farms and not suitable for rehabilitating old farms. However, cutting down cocoa trees entirely and planting grafted seedlings has been the primary way by which farmers rehabilitate their farms.

Using this method for rehabilitating farms takes quite a long time to mature because the plants still have to go through the juvenile stage until they mature, which takes about three years. This means that farmers’ income will be reduced as a result of cutting down of old cocoa trees in order to start new ones. Despite this challenge of farmers possibly having a sharp decline in income, cocoa farmers have only that option of cutting entirely their cocoa trees to rehabilitate their farms. The side grafting on the other hand overcomes this challenge by grafting a bud wood to the side of an old tree. As such, farmers’ incomes are stabilized in addition to yield increases in later years. However, this all important technology has not been officially introduced to farmers.

            Problem statement

More than 90 percent of cocoa beans produced globally is grown on 5.5 million smallholder farms (Wegner, 2012). Ghana is no exception with cocoa widely characterized by small-scale production. Cultivated area per household is 2 hectares or less (Barrientos et al., 2008). According to MoFA (2011), the average yield per hectare of cocoa is 0.4 ton which is relatively low compared to on- station research trials that have an achievable yield of about one ton. This level of productivity is on the low side compared to per hectare yields of 1.8tons/ha, 0.8tons/ha and 0.8tons/ha in Malaysia, Indonesia and Cote d’Ivoire respectively (Danso-Abbeam et al., 2012). Though the country has been able to realize total output above the 1 million tons target, increase in production is largely due to the increase in the area cultivated rather than by improving yield or productivity levels (MoFA, 2006; COCOBOD, 2007). Cocoa yields in Ghana is therefore described as been below global production averages (FAO, 2005; ICCO, 2007).

Out of the six cocoa growing regions, the major production region which is currently the Western Region is the only region for the expansion of cocoa acreage given the presence of unexploited

forest areas (Asare, 2005; Gockowski & Sonwa, 2008). In spite of the growth possibilities of the Western region, the Eastern region which initially was the leading producer of cocoa does not have the benefit of such growth.

One challenge that must be addressed to improve productivity in Ghana is that about 25% of cocoa- trees are over 30 years old and hence have passed their productive life, leading to yield and productivity falls (Anim-Kwapong & Frimpong, 2004). Dormon et al. (2004), also identified the issue of low productivity of cocoa farms in Ghana and opined that these production shortfalls could be attributed to non-adoption of improved technologies. Cocoa farms are major income sources for farmers implying that any decline in yield has worrying effects on farmers’ survival and living standards.

Though the practice of cutting down old cocoa trees and replanting has good intentions of increasing yield, it exposes farmers to several survival shocks because their income source is drastically reduced. As a result, many farmers have not subscribed to the cutting down of their old cocoa trees. It is therefore imperative to implement technologies in a way that sustains the income of farmers. The technology of cocoa side grafting proves a very important technology that surmounts these challenges. Side grafting is done by inserting a bud wood on an opening on the bark of old cocoa trees. Whilst the bud fuses with the established tree, the old branches continue to bear. The old branches are then cut down after the scion matures and is ready to bear fruits. This ensures continuous flow of income whilst improving the yield of the farm.

Effendy, Hanani, Setiawan, and Muhaimin (2013) in their research on the adoption of side grafting in the Sigi Regency of Indonesia stated that side-grafting can increase productivity of cocoa farms. They further explained that normally cocoa produce fruits after 2-3 years of cultivation, but when

side-grafted reduces the fruiting to a year or less with production ranging from 1.8 to 2.75 tons/ha, about 4-7 times yields in Ghana. Consequently, Indonesian farmers doubled or tripled their yields by replacing old trees with high-yielding varieties or grafting bud wood from superior varieties onto old trees (Mars, 2015). This method having been introduced in Southern Bahia, Brazil by Cargill also helped farmers increase their production by 180% during the first two years of introducing the technology to them (Cargill, 2015).

Ghana can take advantage of this rehabilitation technique given that the yield of cocoa farms in Ghana are low compared to other cocoa growing countries. The only hurdle to this technique is that varieties that better withstand Ghana’s major soil borne diseases should be planted and side grafted in later years to ensure smooth implementation of the technology.

One drawback is that this technology entails significant cost given the level of expert knowledge and experience required to execute the procedure. This will require awareness creation among farmers to encourage easy adoption. Asrat, Belay, and Hamito, (2004) found that farmers are willing to pay for technology if they are aware of the benefits associated with its adoption. However, given the way cocoa farmers have been treated over the years in terms of distribution of free cocoa pods for rehabilitation and expansion of their farms, free spraying of farms and other incentives, their willingness to pay for such a technology is doubtful and needs researching into.

This study addresses the following research questions

1. Are farmers aware of the technology of cocoa side grafting?

1. How much are farmers willing to pay for grafting cocoa farms?

1. What are the factors influencing farmers’ willingness to pay for cocoa side grafting?

            Objectives of the study

The main objective of this study is to analyze the willingness of cocoa farmers in the Eastern Region of Ghana to pay for cocoa grafting. The main objective will be pursued as follows;

1. Describe farmers’ awareness of the technology of side grafting

1. Determine the amount farmers are willing to pay for grafting trees on a cocoa farm

1. Identify and estimate the factors influencing farmers willingness to pay amount for side grafting

            Relevance of the study

Cocoa is a major contributor to the GDP of Ghana also to farmers’ incomes. Efforts at improving the agricultural sector must target the cocoa sector. This research will provide valuable information to promote the adoption of technologies that will improve cocoa production in Ghana. In addition, their yields are low relative to achievable yields and therefore very essential to be included in yield improvement schemes. This research will make recommendations for efficient policy making. This study will also make valuable methodological contribution to understanding issues facing the cocoa sector.