Cocoa Pods

2 World’s leading cocoa growers seek more control to boost prices

*Cocoa growers want buyers to pay the full country premium, a separate differential charged for quality

Alexander Davis | ConsumerConnect

Sequel to a reported similar move by the West African nations in 2019, the world’s two biggest cocoa growers are currently planning to suspend exporters’ sustainability programmes in a bid to exert more control over prices.

Agency report indicates that regulators in Ivory Coast and Ghana, which produce more than 60% of the world’s cocoa, decided in a meeting in Accra, recently, so as to suspend programmes allowing buyers to verify if cocoa is grown sustainably.

The measure would make it more difficult for traders to access markets that seek guarantees that the key chocolate ingredient hasn’t been grown in protected forests or using child labour.

The West African nations were reported to have used a similar move last year as leverage to get more companies to pay the Living-Income Differential, a higher-price paid to ensure cocoa farmers earn more money for their labour.

The farmers backed off the deal days later after more buyers had committed to paying extra $400 per tonne for their cocoa beans.

However, they now want buyers to pay the full country premium, which is a separate differential charged for quality.

Report said in Ivory Coast, foreign exporters had temporarily halted the purchase of cocoa contracts in October to force the regulator, Le Conseil du Cafe-Cacao, to reduce the country premium amid slowing demand for chocolate.

In Ghana, there’s also been resistance to paying the country premium, one of the people said, with buyers switching to shorter-term contracts.

The recent announcement to suspend the programmes was delayed following the death of Ghana’s former President Jerry Rawlings November 12, 2020, sources said.

London cocoa futures have dropped about 15% from a peak in September on expectations that big West African crops will lead to a global surplus, stated the report.

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