Ivory Coast to Reform Cocoa Market, Eliminate Middlemen to Streamline System

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ABIDJAN, June 14 (Reuters) – Ivory Coast’s cocoa regulator plans to overhaul the domestic cocoa marketing system to eliminate middlemen within a year, aiming to reduce risks and prevent overpayment, according to an official and sources.

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The reform will target intermediaries who source cocoa beans from farms and resell them to exporters. The Coffee and Cocoa Council (CCC) reports that these independent buyers currently handle about 80% of the cocoa delivered to the ports of Abidjan and San Pedro, while cooperatives handle the remaining 20% in the world’s leading cocoa-producing nation.

The new system, set to be operational by October for the 2024/25 cocoa season, will utilize a digital traceability and certification system developed by the CCC. This system will digitize payments for all cocoa transactions from farmers to exporters.

“The intermediaries who collect the product to resell to other intermediaries will disappear because they will not benefit from this system,” said Arsene Dadie, the CCC’s director of domestic marketing leading the reform.

The reform will rely on farmer identification cards, which also serve as payment cards, and will place cooperatives as the sole intermediaries between farmers and exporters. The CCC has identified 1.05 million cocoa farmers and issued around 900,000 cards, distributing approximately 800,000 of them. About 580 of the nearly 2,000 cooperatives and 22 out of 100 exporters are participating in a test deployment of the new sales system.

“As we distribute the cards, we are gradually rolling out the traceability system among the cooperatives,” Dadie said, noting that the system will ensure direct payments to farmers from the next cocoa season.

The CCC also plans to reduce the number of permits issued to intermediary scouts and buyers, introducing stricter regulations to eliminate those who fail to comply. A CCC source indicated that individuals responsible for current overpayments would be excluded from permits and that severe measures would be implemented to better control the market.

According to the CCC, around 40,000 metric tons of beans are currently hoarded in farm warehouses by independent buyers demanding higher prices, which has slowed down supply to exporters. This situation forced the CCC to suspend cocoa bean exports to allow local grinders to purchase necessary volumes for factories.

“Today, middlemen buyers and scouts control 80% of purchases in the farms, but with the new marketing system, the cooperatives will take power. We clearly want to exclude the buyers,” the CCC source said.

By Naija247news
By Naija247newshttps://www.naija247news.com/
Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

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