Ghana Cocoa Board Says 2013-14 Output to Beat Target on Weather

Jan 20, 2014 2:34 pm ET

Jan. 20 (Bloomberg) -- Cocoa output in Ghana, the world’s biggest producer after Ivory Coast, will exceed this season’s target due to “good” weather and an increase in plantings, according to the country’s industry regulator.

Farmers in the West African nation will probably gather 850,000 metric tons of the beans used to make chocolate in the 2013-14 season started Oct. 1, according to Noah Amenyah, a spokesman for the Ghana Cocoa Board. The target was 830,000 tons, Stephen Opuni, chief executive officer of the regulator know as Cocobod, said at a press conference today.

“The weather has so far been good and other new farms have come on board, we have some good cocoa coming from the Volta region,” Amenyah said in an interview after the press conference in Accra. “We can cross 850,000 tons this season.”

Cocoa rose 0.2 percent in London this year and fell 0.3 percent in New York as traders weigh rising deliveries in West Africa, accounting for about 70 percent of global supplies, and increasing consumption. “Strong” cocoa arrivals in the region are cutting shortages, Barry Callebaut AG, the world’s biggest processor and largest maker of bulk chocolate, said in an earnings statement on Jan. 15.

Bean deliveries in Ivory Coast were an estimated 33 percent higher from the start of the season on Oct. 1 through Jan. 12 compared to a year earlier, according to KnowledgeCharts, a unit of Commodities Risk Analysis. That was the highest since at least 2004-05. Purchases in Ghana were 22 percent higher as of Jan. 2, the most since 2010-11, data from the researcher in Bethlehem, Pennsylvania, showed.

Same Size

Ghana’s crop “is probably the same size and shape as last year’s,” Kona Haque, an analyst at Macquarie Group Ltd. in London, said by phone. “Purchases, which are running ahead, could be over-declared and it’s likely that they will start to slow down.”

Cocobod will probably have a new estimate of the crop “within weeks,” Amenyah said. Regulatory officials are still in the field gathering data to make an estimate, he said.

Ghana is investigating smuggling of cocoa into Ivory Coast, Cocobod’s Opuni said. As many as 40,000 tons of beans went from Ghana into Ivory Coast since November, Accra-based radio station Citi FM reported on Jan. 14, without saying where it got the information. A sliding local currency means the price paid to Ivorian farmers is now higher. The cedi slid 20 percent last year, the third-worst performing African currency in a basket of 22 tracked by Bloomberg.

“The national security anti-smuggling taskforce will start patrolling the boarders to ensure that any form of cocoa smuggling is stopped,” Opuni said.

While Ghana pays a fixed price to farmers of 3,392 cedis ($1,407) a ton, Ivorian farmers receive a minimum price of 750 CFA francs a kilogram ($1,540 a ton).

--Editors: Claudia Carpenter, Andres R. Martinez