The world’s top cocoa producers backed down from a threat to suspend sustainability programs that they said confectioners and other buyers had prioritized over better pay for farmers.
Ivory Coast and Ghana, where more than 60% of the world’s cocoa is grown, warned the industry earlier this month that companies have to either start purchasing beans at a price that includes a so-called living-income differential of $400 a ton, or risk a halt to their social responsibility projects — commercially sensitive programs that consumers increasingly demand.
The premium would benefit all farmers while sustainability programs only reach a few, the regulators said.
Stay of Action
“After very difficult engagement with industry, we have come to a clear understanding that industry now generally supports the living-income differential,” Ghana Cocoa Board Chief Executive Officer Joseph Boahen Aidoo said Wednesday at a conference in Berlin, which he addressed jointly with Yves Kone, the managing director of Ivory Coast’s cocoa regulator.
“Therefore we are staying our action” on sustainability programs, said Aidoo.
Since the implementation of the price plan in July, many firms in the cocoa and chocolate sectors have grappled with adhering to the new strategy as the premium cannot be hedged. Analysts have also questioned whether the plan will eventually cause an oversupply of beans and disrupt prices further.
- Ghana May Postpone Delivery of 250,000 MT of Cocoa Due to Shortage - April 12, 2024
- Ghana Cocoa Farmgate Price To Go Up By 50% - April 4, 2024
- More African Processors Shutdown As Cocoa Shortage Deepens - March 17, 2024