Under pressure from growers, eager to take advantage of the surge in cocoa prices on international markets, the Ivorian government announced on Tuesday, April 2, a record increase in the minimum price guaranteed to farmers. Plus 50% for the intermediate campaign, open from April to the end of September, thus increasing the kilo of beans from 1,000 to 1,500 CFA francs (1.52 euros to 2.30 euros). A week earlier, a ton of cocoa was trading at $10,000 (€9,300) on the New York Stock Exchange. A historic peak from which the producers of the world's leading exporter – 40% of production – intend to benefit. Several of their unions had, on March 27, suspended a strike notice filed for the next day, after being promised imminent “courageous decisions” from the government.
Expected by the main players in a sector which contributes to nearly 15% of Ivorian GDP, the Minister of Agriculture, Kobenan Kouassi Adjoumani, praised on Tuesday "a price level never before achieved in the history of the cocoa sector in Côte d’Ivoire” and praised the “exceptional efforts” made by the State.
If, in the memory of Ivorian farmers, such a high floor price had never been reached, three planters' unions, meeting in the premises of the Coffee-Cocoa Council (CCC), "took note" of the increase in this price “field edge” flooring, purchased directly from the producer, but warn that their “final decision” will be known on April 12, after a consultation meeting planned in Daloa (central-west) with their delegates in the region. Because if they appreciate the government's gesture, their demands concerning "the review" of the futures sales system have not been taken into account. In Ivory Coast, 70% to 80% of the harvest is sold in advance to exporters through electronic auctions. The rest through “spot” sales, for cash, immediately after the harvest.
This demand for reform was taken up by MPs from the PDCI, the main opposition party, who are calling for an increase in the floor price to 2,500 CFA francs (3.81 euros) and “a review of the product marketing policy Ivorian farmers”.
Global warming
“We had to observe an increase in prices on the stock markets for many languages to start criticizing the stabilized system in favor of the liberal system,” replied Kobenan Kouassi Adjoumani, recalling that Ivory Coast has already experimented with a spot sales system between 2000 and 2011. “Insignificant amounts were paid to producers when world prices fell. Often, cocoa was paid for less than 500 CFA francs per kilo,” he argued while Ivorian farmers look with envy at their Cameroonian counterparts who these days resell a kilo of cocoa at around 5,000 CFA francs .
Together with the director of the Coffee-Cocoa Council, Yves Brahima Koné, the Minister of Agriculture assured that the surge in world prices will benefit Ivorian producers with “a time lag” since sales of the 2024-2025 harvest will be based on the price which will be in effect on October 1, 2024. Provided that the volumes harvested correspond to forecasts.
Because the torrential rainfall of recent years, which has added to the proliferation of the cocoa shoot edema virus, is reducing the quantity of beans harvested. For the 2023-2024 season, the expected volume of 1.75 million tonnes is a quarter less than that of the previous campaign. A continuation of this drop in production, caused in particular by global warming and the aging of orchards, could fuel the rise in prices and relaunch the debate on the anticipated sales system.
