Cocoa purchases plunge in Ghana amid election-related payment delays, financing crunch 

GHANA – Cocoa purchases in Ghana experienced a significant decline in December 2024 due to payment delays from the state marketing board and limited financing for exporters, farmers and buyers revealed.  

These issues have raised concerns about a potential increase in smuggling. 

Global cocoa prices have reached record highs over the past year, driven by poor harvests in the world’s two largest producers, Ivory Coast and Ghana.  

While West Africa has seen some recovery in the 2024/25 crop season, fears of supply disruptions persist. 

Ghana’s marketing board, Cocobod, introduced a new marketing system this season, replacing a three-decade-old model.

Under the new arrangement, global traders and buyers are tasked with financing and purchasing most of the cocoa crop, with reimbursement from Cocobod upon delivery. 

However, sources within licensed cocoa buyers (LBCs) reported that the Dec. 7 presidential election, which saw opposition candidate John Dramani Mahama return to power, disrupted this system.  

According to Reuters, uncertainty surrounding the election outcome and fears of unrest led to delays in payments from Cocobod and cautious lending by banks. 

One LBC management executive said his company reduced cocoa purchase financing due to delayed Cocobod payments. “Banks have also been hesitant to release funds,” he added. 

However, Cocobod denied that the election or the transition period affected its payments, stating, “In some instances, there are operational challenges, and buyers may pay farmers a week later, but there is no general issue of nonpayment or delays.”

Despite these assurances, payment delays are severely impacting farmers, particularly in remote rural areas.  

A district officer for a leading LBC told Reuters that purchasing clerks had credited him with 2,000 bags of cocoa beans, but he lacked the funds to pay farmers due to financing delays from his head office. 

Ghana’s cocoa production has improved compared to last season’s poor harvest, but many farmers now struggle to sell their beans.  

With unsold stock accumulating on farms and a widening gap between Ghana’s official farmgate price and higher global spot prices, buyers warned that smuggling is likely to surge. 

Last season, Ghana lost more than a third of its cocoa output to smuggling, with most of it transported through neighboring Togo, where regulations are less stringent. 

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