(Updates with 2009-10 purchases figures)
By Kwasi Kpodo
ACCRA, Sept 28 (Reuters) - Ghana's cocoa regulator raisedofficial cocoa prices by a third on Tuesday in an effort tostamp out smuggling that has slashed its official purchasesvolumes.
Prices for the 2010-11 season set to begin on Oct. 1 in theworld's No. 2 grower will be 3,200 cedis ($2,238) per tonne, upfrom 2,400 cedis per tonne during the 2009-10 season, FinanceMinister Kwabena Duffuor told a news conference.
The move was intended to discourage smuggling of cocoa toneighbouring West African states including top grower IvoryCoast, he said of a trend experts believe may have kept as muchas 100,000 tonnes of cocoa off Ghana's books this year.
"The fact that they have made the price more competitive isa positive sign for domestic supply, and should stop somecross-border smuggling," said Sudakshina Unnikrishnan,commodities analyst at Barclays Capital.
She said it was unlikely to lead farmers to significantlyboost production, however. "It's supportive for domestic supply,but it's not a game-changer," she said.
Ghana's official cocoa purchases totalled 632,024 tonnesduring the 2009-10 season, down about 10 percent from theprevious year, according to new Cocobod figures obtained byReuters on Tuesday.
Finance Minister Duffuor said he expected purchases torecover to 700,000 tonnes in the coming season.
The lacklustre performance runs counter to Ghana's ambitioustarget of producing 1 million tonnes of cocoa per year by 2012,an amount that could allow it to rival Ivory Coast, whose outputthis year is running at around 1.2 million tonnes.
Benchmark cocoa futures for delivery in December tradedaround $2,820 per tonne in New York on Tuesday.
Ghana's sector operates on a fixed-price basis whereas theliberalised Ivorian industry uses an indicative price systemwhich is not binding and so its prices more closely trackdevelopments on the world market.
Farmers greeted the price hike warmly.
"We are happy about the bold decision by the government toincrease the producer price and make it competitive with theindicative price of Cote d'Ivoire," said Nana Kwasi Ofori, afarmer and representative of central region growers.
"From what I see on the trees, more cocoa will come nextyear. The weather too is good and I believe we will get morethan the 700,000 tonnes" he said.
Last week industry regulator Cocobod secured commitmentsworth $1.5 billion to fund purchases of cocoa beans for exportin the 2010/11 season, according to the bank that was leadmanager of the transaction.
That was 25 percent more than targeted as the facility --which is used by Cocobod to finance purchases of beans -- washeavily oversubscribed.
Duffuor said Ghana was planning additional incentives togrowers, who have often complained of low prices.
"To further reward hardworking farmers, the government hasdirected the Ghana Cocoa Board to work out and pay bonuses tofarmers on the 2009/2010 main cocoa crop," Duffuor said.
(Reporting by Kwasi Kpodo; additional reporting by DanielMagnowski in Dakar; editing by Mark John)