IVORY COAST—The Ivorian government is currently implementing a substantial increase in the farmgate price of cocoa beans by 50% in a bid to motivate farmers produce more cocoa.
This was announced by Kobenan Kouassi Adjoumani, the National Minister of State for Agriculture, Rural Development, and Food Production, who revealed that the price is set to rise from CFA Fr1,000 (US$1.64) per kilo to CFA Fr1,500 (US$2.46).
This is expected to carry a significant weight in the market, especially due to the fact that Ivory Coast is the world’s leading producer of cocoa, accounting for 40% of global cocoa beans supplied all over the world.
Adjoumani highlighted the possibility of further positive developments, stating, “If the dynamic of the rise in world prices continues like this, we will still have very good news to announce to you.”
Gerard Stapleton, a global agribusiness analyst at GlobalData, a data analysis and consultation firm, also commented on this plan, fully supporting the idea that this price hike is poised to stimulate increased cocoa production among growers.
“Ultimately, it should encourage farmers to increase their output, compared to the previous farmgate price level,” he noted.
This development comes amidst a backdrop of soaring cocoa prices, which have more than tripled over the past year due to persistent supply challenges.
In fact, this is the third consecutive deficit, largely driven by the prevalence of two destructive diseases – black pod disease and cacao swollen shoot virus.
Also, factors such as increased rainfall, particularly evident with Côte d’Ivoire experiencing double its typical precipitation levels in July 2023, have contributed to the proliferation of diseases.
“Increased supply should be bearish for international prices i.e. reduce the supply/demand deficit. But, for those Ivorian farmers whose crop yield is impacted by disease, it may not make much difference to their output, particularly in the short term,” Stapleton observed.
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