Ghana Cocoa Regulator Won’t Seek Syndicated Loan for 2024/25 Season, CEO Announces

Ghana’s cocoa regulator, Cocobod, will not secure a syndicated loan for the 2024/25 cocoa season, a first in over 30 years, announced Chief Executive Joseph Boahen Aidoo on Tuesday. The new season will commence on September 1, earlier than usual, with a revised target of 650,000 tonnes, down from the earlier forecast of 810,000 tonnes due to inadequate rainfall.

Aidoo confirmed that Cocobod will finance the season locally, stating, “We are not taking funds from cocoa traders. The money will come locally. We are going to be self-financing.” This shift aims to save the regulator $150 million in interest costs previously paid on syndicated loans, which last year carried a record 8% interest rate.

Since the 1992/93 season, Ghana has relied on annual syndicated loans for cocoa bean purchases. However, due to challenges including harsh weather from El Nino, rampant smuggling, and swollen shoot disease, the country faced one of its poorest harvests in a decade during the 2023/2024 season.

The new season’s early start is a response to increased smuggling to neighboring countries and aims to counteract the lower-than-expected output. Despite the reduction in target, Ghanaian cocoa farmers are hopeful for a recovery in the 2024/25 season due to improved weather conditions and rehabilitated farms. Aidoo noted that, if necessary, a combination of self-financing and domestic funding will be utilized.