ACCRA, Sept 23 – Ghana’s Cocoa Board (COCOBOD) plans to raise 16.3 billion Ghana cedis, equivalent to about $1.4 billion, from domestic investors to finance cocoa purchases for the upcoming season, Reuters reported on Wednesday, citing a government presentation to investors.
The move marks a significant shift in how Ghana intends to finance its cocoa procurement operations after the collapse of its decade-old syndicated loan arrangement with international banks during the 2023/24 season.
A separate financing structure involving international cocoa trading companies also failed during the previous season, contributing to delays in payments to farmers and creating uncertainty around financing for the new crop.
COCOBOD plans to raise the funds through Cocoa Capital PLC, a newly established special purpose vehicle. The first tranche is expected to comprise a 2.3 billion cedi bond and 4 billion cedis in commercial paper.
The commercial paper, with maturities of up to 270 days, will finance seasonal cocoa purchases, while the bonds, with maturities of up to five years, will be used to refinance existing short-term obligations held by COCOBOD.
The financing push comes as cocoa buyers seek settlement of outstanding obligations from the previous season. Ghana’s licensed cocoa buyers said last week that COCOBOD owed them approximately 4 billion cedis and called for the payments to be made before the new crop year begins.
The Chamber of Cocoa Marketers, which represents licensed buyers, has also raised concerns that sufficient financing may not yet be available to purchase cocoa once the new season starts.
New Season Date Still Pending
Ghana has yet to announce the start date for its new cocoa season, while neighbouring Ivory Coast, the world’s largest cocoa producer, opened its season on September 1.
The two countries agreed in June to coordinate their farmgate pricing and cocoa season calendars following a meeting between their presidents.
Under the proposed financing structure, debt repayments will be supported by cocoa export receivables generated from selected forward sales contracts, according to the investor presentation.
The targeted investor base includes commercial banks, pension funds, insurance companies, stockbrokers, high-net-worth individuals, other institutional investors and international cocoa buyers.
COCOBOD did not respond to Reuters’ request for comment on the planned issuance. The regulator said on X last week that the government had been engaging investors, describing the initiative as a move toward greater use of Ghana’s domestic capital market to finance the cocoa industry.
The shift places domestic capital markets at the centre of efforts to secure working capital for Ghana’s cocoa supply chain, following the deterioration of the international financing structures that previously supported purchases from farmers.
