IVORY COAST – The Ivorian cocoa regulator has alleged that U.S. chocolate maker Hershey’s move to buy cheap beans from the New York futures exchange is an attempt to derail plans by Ivory Coast and Ghana to increase farmers’ income.
The two West African nations who together produce more than 60% of the world’s cocoa, implemented a price floor of US$2,600 per tonne and a Living Income Differential (LID) of US$400 per tonne, meant to tackle poverty among farmers.
The move was supported by Chocolate makers and grinders who source the raw material from these two countries.
However, with Hershey striking a deal to take delivery of as much as 30,000 tonnes of beans through the ICE exchange is seen as a retaliation by the industry player to avoid paying the LID under the new scheme.
“It is a conspiracy to defeat the concept of the floor price as known, and therefore not to grant a remunerative price to all cocoa producers in our countries.”
Yves Kone – Head of Ivory Coast’s Coffee and Cocoa Council
This was revealed by Yves Kone, head of Ivory Coast’s Coffee and Cocoa Council (CCC), in a letter seen by Reuters to the president of the World Cocoa Foundation (WCF) industry group.
“It is a conspiracy to defeat the concept of the floor price as known, and therefore not to grant a remunerative price to all cocoa producers in our countries,” Kone said in the letter.
The World Cocoa Foundation (WCF) is a non-profit international membership organization made up of cocoa producers, cocoa suppliers and chocolate manufacturer whose vision is to ensure the sector is run in a sustainable way.
To fully address the matter, Kone further urged WCF head Rick Scobey to push companies to respect their engagements and pay the LID.
He warned that Ivory Coast could take measures including publicly shaming companies and suspending sustainability and certification programmes used by companies to assure consumers that beans are ethically sourced.
Last week, Ghana’s cocoa regulator threatened to suspend the sustainability schemes, accusing cocoa and chocolate companies of thwarting government attempts to combat farmer poverty.
Responding to the allegations, Hershey said it was committed to paying the LID, “The majority of the cocoa products we buy will continue to come from West Africa and will include the LID for the 2020-21 crop and beyond.”
Ivory Coast and Ghana, recently formed a joint body to deal with such kind of issues and defend their collective position in the global market.
The Ivory Coast-Ghana Cocoa Initiative (ICCIG) will promote their cocoa industries internationally, improve coordination in research, price setting and the collectively heighten the fight against child labour.
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