In a significant move that underscores its commitment to cocoa producers, Ivory Coast’s President Alassane Ouattara has announced a 50% increase in the official cocoa farmgate price, elevating it to 1,500 CFA francs ($2.47) per kilogram starting Tuesday. This adjustment comes as a response to the global cocoa market dynamics, which have seen prices more than triple over the past year due to disease and adverse weather conditions leading to a third consecutive year of deficits.
The decision, revealed by sources from five different export companies who wished to remain anonymous due to the sensitive nature of the information, was finalized during a government meeting on Saturday. Initially, President Ouattara had considered setting the price between 1,100 and 1,200 CFA francs per kg but opted for a more substantial increase in support of the cocoa farmers. This move reflects the government’s intention to ensure that the prosperity of the global market translates directly to the local growers, who are crucial to the country’s economy.
Cocoa, being a vital export commodity for Ivory Coast, the world’s top cocoa producer, plays a significant role in the national economy. However, despite the global price surge, the farmgate price in Ivory Coast had remained stagnant, not reflecting the increased market value of cocoa. The president’s decision to raise the farmgate price marks a pivotal moment in addressing this disparity, aiming to provide a fairer share of the global cocoa earnings to the local farmers.
The increase to 1,500 CFA per kg represents not only a significant boost in income for thousands of cocoa farmers across the country but also a strategic move to stabilize the sector amid fluctuating global market conditions. According to the director of a European export company, this price adjustment was deemed the best possible outcome within the constraints of Ivory Coast’s cocoa sales system, which typically makes it challenging to alter prices mid-season.
Acknowledging the exceptional circumstances affecting the global cocoa market, President Ouattara’s directive for an equally exceptional response has been welcomed by stakeholders within the industry. The director of another international export company highlighted the president’s recognition of the unique market situation and his determination to react accordingly, ensuring that Ivory Coast’s cocoa producers are not left behind in benefiting from the global price increases.
As the new farmgate price is set to take effect, the move is anticipated to have a positive impact on Ivory Coast’s cocoa sector, enhancing the livelihoods of farmers and strengthening the country’s position in the global cocoa industry. While the Coffee and Cocoa Council (CCC), the regulatory body overseeing the cocoa industry in Ivory Coast, has yet to comment, the industry’s stakeholders are optimistic about the positive ripple effects this decision will have on the sector’s sustainability and growth.
This price increase is a clear indication of Ivory Coast’s proactive stance in safeguarding the interests of its cocoa farmers, ensuring that they benefit from the favorable global market trends. As the country navigates the complexities of the international cocoa market, this decision is a testament to its commitment to maintaining a balanced and equitable economic ecosystem for all participants in the cocoa value chain.
