Global crisis pushes down cacao prices

The ongoing global financial crisis has pushed down cacao prices, adding to the plight of cacao farmers, who are also struggling with pest attacks.

"The significant price drops are due to the crisis. The prices of agriculture commodities are heavily dependent on the prices at the global markets," the head of the Bali Agriculture Agency, I Gede Ardhana, said Wednesday.

The price of fermented cacao has dropped recently from Rp 31,000 (US$2.74) per kilogram to Rp 17,000 per kilogram.

However, Ardhana stressed such a decrease had yet to result in any financial losses to farmers.

"The base price is Rp 10,000 per kilogram, so if the farmers sell their cacao at Rp 17,000 per kilogram, they will still earn a profit."

Ardhana said the price fall had begun in late 2008. However, the chairman of the Bali Alliance of Cacao Communities, Wayan Suarma, lamented the price drop, claiming it would make life more difficult for the cacao farmers.

"Particularly since we are now also facing a possible decrease in production due to pest attacks."

Suarma urged the government to provide much-needed assistance to the farmers, to enable them to cope with the decreased market value, as well as the pest attacks.

Ardhana said cacao was one of the island's primary export products. Unfortunately, the level of productivity among the island's cacao farms is still below the targeted level.