A significant cocoa shortage has intensified discussions between Ivorian exporters and major international traders in Ivory Coast, the world’s leading cocoa producer.
Amidst the shortage, a faction of local shippers is pressing for permission to redirect cocoa initially intended for international trading giants Olam and Barry Callebaut to alternative buyers. This move comes after these traders resisted paying above the regulatory price, as shared by individuals with insight into the ongoing discussions.
The global cocoa market is experiencing unprecedented price surges due to successive deficits over the last three seasons. Such conditions have compelled companies to offer rates exceeding government-set prices to farmers in order to secure supplies, despite regulations enforced by the Ivorian coffee and cocoa council, Le Conseil Cafe-Cacao.
Le Conseil Cafe-Cacao has historically penalized international buyers for paying more than the official rate for cocoa delivered to their operations. The council, however, has not intervened in this particular matter, according to a spokesperson.
The Ivorian government allocates a minor portion of its cocoa crop annually for export by Groupement des Negociants Ivoiriens (GNI), a local shippers’ association. The current deadlock arose when the GNI urged its members to negotiate the completion of export contracts with Olam and Barry Callebaut, both leading cocoa processors globally.
Local exporters have increased their payments to farmers for beans, prompting demands for higher payments from international traders. Neither Barry Callebaut nor Olam, nor the GNI, provided comments when approached. The CCC also refrained from detailing its involvement.
The tensions in the cocoa market of Ivory Coast underscore the complexities facing traditional trading practices amidst fluctuating global prices. The resolution of this dispute could significantly impact future trading dynamics and regulatory oversight in the cocoa sector.
