(3 Minutes Read)
Cocoa farmers in Ivory Coast demand an overhaul of the crop’s pricing system. Cocoa producers have called on the sector’s regulator to overhaul its pricing scale, warning that it is preventing them from benefiting from record-high prices in the international market for the chocolate ingredient.
Cocoa prices have nearly tripled over the past year as bean disease and adverse weather pushed the global market to a third successive deficit, but the official ‘farmgate’ price fixed by the regulator is yet to reflect this aspect. Moreover, the cocoa regulator the Coffee and Cocoa Council (CCC) has warned exporters against paying above the mandated price for beans delivered to their port facilities, threatening them with fines and the loss of their licenses.
In response, Côte d’Ivoire farmers and non-profit organisations that represent them called on the CCC to open a discussion on overhauling its price-setting mechanism to allow farmers to benefit from the higher world prices. In several countries, cocoa producers benefit directly from world market prices. It is difficult to understand why (Ivorian) cocoa producers are not benefiting,” the Ivorian Platform for Sustainable Cocoa (PICD) said.
It said the CCC’s current price-setting mechanism, which includes setting farmgate prices twice yearly, “clearly has weaknesses”. The official farmgate price is 1,000 CFA/kg and while most farmers in Ivory Coast are getting a premium, and being paid 1,300-1,500 CFA/kg, that is low. Industry sources told that farmers in Cameroon are currently getting nearly 4,000 CFA/kg for their cocoa.PICD’s concern is that the current premium farmers are getting could disappear if the various actors along the chain heed the CCC’s warning not to pay above its mandated prices.
Traders and processors in Côte d’Ivoire usually buy beans from local dealers up to a year in advance at pre-agreed prices. The CCC then sets lower farmgate prices based on these deals, as well as mandated prices for others in the chain. In times of shortage like this year, however, the system often breaks down, with local dealers paying farmers a premium to secure available beans, and then charging above the mandated price when selling.
Read Also:
https://trendsnafrica.com/global-cocoa-prices-skyrocket-as-yield-drops-further-in-the-continent/
https://trendsnafrica.com/global-cocoa-prices-hit-the-roof/
Top global producer Ivory Coast and number two Ghana together accounted for almost 60 percent of the 2022/2023 worldwide harvest, according to estimates from the Abidjan-based International Cocoa Organization (ICCO).
