REUTERS

ACCRA — Cocoa output from the world’s second biggest producer Ghana for the 2022/2023 season is expected to miss by around 11% the target of 750,000 tons due to smuggling and illegal gold mining on farmland, sources told Reuters.

Ghana last week brought forward the closure of the 2022/2023 season by a month, and decided to start the 2023/2024 season on Sept. 8, a month earlier than usual, saying it needed to tackle disruptions in the internal marketing of cocoa.

Neither the government, nor the cocoa regulator COCOBOD, provided details about the disruptions.

Two sources, one from COCOBOD and the other from the state-run Cocoa Marketing Co. (CMC), told Reuters that Ghana’s cocoa output slumped due to increased smuggling to neighboring Ivory Coast and Togo where the beans fetched higher prices.

Around 50,000 tons of cocoa was lost through smuggling, the sources said. A director of a cocoa exporting company and a cocoa pod counter who both requested anonymity, said, however, that continuous illegal gold mining on farmlands in Ghana, known locally as galamsey, was to blame for Ghana’s falling cocoa output.

“The smuggling to Ivory Coast and Togo has been minimal and cannot explain everything. The problem is deeper, and the galamsey are to be blamed,” the director said.

For the 2023/24 season which is expected to start on Friday, Ghana’s cocoa regulator expects output to reach 800,000 tons, according to the COCOBOD source.

“Our projections are 800,000 tons for the new season. The weather conditions have been more favorable,” the COCOBOD source said.

COCOBOD will be seeking $1.2 billion to finance cocoa purchases for the 2023/2024 season, compared with $1.3 billion it raised in the previous season, the COCOBOD source and a source from the CMC said.

“We are looking for around $800 million from the private bank consortium and $400 million from the private sector for the 2023/24 season. We are confident that, as usual, we will receive more than we need because we have the trust of investors,” the CMC source said.

COCOBOD and Ghana’s government did not respond to requests for comment.

The optimism from the Ghanaian regulator is not shared by exporters and pod counters, who forecast 2023/2024 output at between 650,000 tons and 700,000 tons due to the impact of galamsey mining, which has led to the destruction of cocoa plantations in the past three years.

“I am not as optimistic as the CMC and COCOBOD about this year’s production. We have been observing a decrease every year for the past three years, and it is lasting because the plantations are entirely destroyed by gold miners,” another director of a cocoa exporting company said.

“These plantations are not being replaced,” the director added. — Reuters

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