Ivory Coast’s Coffee and Cocoa Council (CCC) regulator has significantly curbed the hoarding of beans in September due to sanction threats.
Sources within the CCC, exporters and buyers told Reuters on Thursday that the sanction threats were made against buyers and cooperatives.
Cocoa bean arrivals at the Ivorian ports of Abidjan and San Pedro exceeded 50,000 tonnes in the first three weeks of September.
This marked a significant increase from around 19,000 tonnes recorded for the entire month of September 2023.
The CCC expects to finish September with the delivery of more than 65,000 tonnes of cocoa beans, despite the month typically spelling bean hoarding by buyers and cooperatives.
This is the case especially if they expect an increase in the guaranteed farmgate price at the start of the new season in October.
Farmgate
The world’s top cocoa grower will launch its 2024-25 cocoa season on 1 October, when a new farmgate price will be announced.
It is expected that the farmgate price will match or be slightly higher than in neighbouring Ghana, the world’s number-two producer.
Ghana has increased its farmgate price by nearly 45% compared with last season to boost farmers’ income.
A CCC source told Reuters, “We have managed to stem the end-of-season cocoa-hoarding practiced by buyers and some cooperative who try to make easy money if the guaranteed farmgate price increases.”
Stocks
The decline in cocoa bean storage at the end of this season is primarily attributed to a crackdown by the regulator.
The CCC suspended some cooperatives in May and warned in late August of the possibility of withdrawing buying licenses from independent buyers and cooperatives found hoarding cocoa.
It also launched a stock verification operation in the production regions and deployed hundreds of agents accompanied by law enforcement officers.
According to some exporters, the regulator’s drive to curb hoarding, and the 25% decline in output this year due to poor weather conditions and diseases, will potentially lead to a drop in bean arrivals at the start of the season in October.
A director of a cocoa export company based in Abidjan told Reuters, “I’ve never seen so much cocoa in September for 30 years.
“But this means that October will be poor in cocoa because the growers have harvested everything and everything has been delivered, so we won’t have any stock to start the season.”
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