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February 14, 2011

Ivorian farmers fear cocoa to rot as buying halted

by Loucoumane Coulibaly

A halt to cocoa-buying in Ivory Coast is leaving beans to rot in farm warehouses, while smuggling through Ghana intensifies and some growers switch to other crops, farmers said on February 10.

Economic sanctions, a cocoa export ban and a liquidity shortage since incumbent Laurent Gbagbo seized the central bank's local branch has left the cocoa industry in chaos in the world's largest grower as beans pile up in farms or are smuggled out.

Alassane Ouattara, who beat Gbagbo in a November 28 presidential poll, according to U.N.-certified electoral commission results that Gbagbo refused to concede, last week called for a one-month cocoa registration ban to starve his rival of tax revenues.

Cocoa exporters, fearing sanctions by Western powers that recognise Ouattara's win, have played ball.

In the western region of Soubre, at the heart of the cocoa belt, farmers and one cooperative manager said in interviews they no buyers were taking their beans last week and they feared the poorly dried beans stashed in their warehouses would rot.

"Nothing's moving, everything's stopped," said farmer Innocent Zamble, who runs a farm in the Soubre town of Meagui. "Our stores are stuffed with beans and there's no more space to stock them. We fear the quality is going to perish because we don't have the capacity to stock big quantities long term."

Ouattara has not said whether the ban will be extended when it expires on February 23. Exporters estimate that around 65,000 tonnes arrived at Abidjan and San Pedro ports in the two weeks to February 6, none of which has been exported.

But even if it is lifted, EU restrictions on ships registered there doing business with the port, which the European Union says is supporting "Gbagbo's illegal regime," will continue to interrupt export activities.

And a shortage of liquidity means there is not enough cash to pay suppliers on a day-to-day basis, exporters say.

In the western region of Gagnoa, farmers and cooperative managers said several growers were switching to growing vegetables, tomatoes or maize, which can be harvested faster for export or local trade.

"They're not paying for the cocoa and farmers have to survive," said cooperative manager Francois Badiel. "Lots of them are now doing trunk farming (growing vegetables) instead. This is the first time they've seen a situation like this."

In the eastern region of Abengourou, on the Ghana border, farmers said huge numbers of cocoa trucks were crossing the border in smuggling operations.

"When we saw how many trucks full of cocoa were heading over the border every day, we said: 'There's not even that much cocoa in our region'," said Abengourou farmer Joseph Amani. "It must be coming in from other regions as well. It's easy to get it here from Daloa or Soubre by road."

A purchasing manager of an international cocoa exporter said that while major international exporters have stopped purchases, some local exporters were very active at the port, buying at about 900 CFA francs per kg.

Local exporters have tended to support Gbagbo, while the big multinationals are bound by their base countries in Europe or the United States to recognise Ouattara's authority.

"The small local exporters are still very active in the past week. They are buying a lot of cocoa, but I'm wondering where they are exporting it and on which ships," the manager said.

Reuters

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