SPECIAL REPORT: ‘COCOA WARS’ COULD TRIGGER SUPPLY GLUT AND WEST AFRICA DIVESTMENT

   Mon, 01 July 2019

The governments of Ghana and Cote d’Ivoire are moving closer to cocoa market consolidation and are due to introduce a relatively modest minimum floor price for producers to alleviate widespread poverty among farmers. The countries have threatened to suspend forward sales until the plan is put in place. However, there remain challenges to implementation including lack of liquidity. The strategy could also backfire by creating a supply glut and causing a structural weakness in the cocoa market, motivating divestment from West Africa to other cocoa-producing regions.

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