In the news

Most Read

  • Telkom CEO Sipho Maseko to step down
    Telkom has announced that its CEO and executive director Sipho Maseko will step down on 30 June 2022. The telecoms company said the process to appoint a successor is well underway and a designated group CEO will be announced in the not too distant future.
  • How cooking oil brought a moment of joy during a dreadful week
    It is possible that cooking oil prevented more looting in South Africa in the last week than the president, the ANC, the intelligence community, the army and the police combined. This, without question, says something about the versatility of the product. It says even more about the state of the state. When you are shown up by canola, you might want to revisit your strategy. By Howard Feldman
  • Park Advertising launches digital performance unit, Lucid Media
    Performance Media across Search, Social and Programmatic platforms is the single fastest growing area of digital media in South Africa. Combine that with the detailed analysis of campaign management, tagging and ad operations, and it becomes apparent that these highly specialist functions require a highly specialised unit.
  • Transnet hit by cyberattack - Operations disrupted nationwide
    The Transnet Port Terminals website has been hacked, implying that all companies under Transnet have been affected. All Transnet websites were down at the time when reporting was done for this SA Trucker article. The publication cited sources who requested to remain anonymous because they are not allowed to speak to the media.
  • #BehindtheBrandManager: Meet Tamsin Darroch of Kellogg's South Africa
    Few food brands have the historical connection with consumers around the world as Kellogg's does, having held meaning at the breakfast table for over a century. By Lauren Hartzenberg
  • Business unusual for small enterprises on the road to recovery
    The Covid-19 pandemic has hit South Africa's small business sector hard and there are grim statistics to bear this out. Those statistics will not be repeated here. After all, if you are a small business owner setting out on the road to recovery, the last thing you probably want is more details of the toll the pandemic has taken on small enterprises. Far more useful would be some good, solid tips on how to build back better after any business setbacks. By Ameen Hassen
Show more
Advertise on Bizcommunity

Subscribe to industry newsletters

Ivory Coast sells 2021/2022 cocoa contracts after wrangle over premium

The world's top cocoa producer Ivory Coast had sold 950,000 tonnes of cocoa in contracts by the end of May for the 2021/2022 season at a country discount instead of its usual country premium, regulator and industry sources said earlier this week.
A man prepares cocoa beans for sale in Daloa, which produces a quarter of Ivory Coast's national cocoa output. Reuters/Thierry Gouegnon

The West African producer typically sells cocoa with a country premium of £70-150 per tonne to reflect its quality. Since last year, it also added a $400 per tonne premium to be paid to farmers to boost their wages.

As a result of the premium for farmers, known as the Living Income Differential (LID), buyers have been pressing for the country premium to be turned into a country discount, so farmers receive the extra cash but prices stay globally competitive.

The sources told Reuters that contracts agreed by the end of May had a country discount of £150-200 per tonne, a move that would effectively mean farmers still received extra cash but the government revenues from sales were reduced.

The West African producer had been locked in talks with exporters over the price of its beans as a bumper crop and weak global demand caused by the coronavirus pandemic, coupled with the introduction of the LID, pushed down sales.

Confirmed contract sales by mid-May stood at 560,000 tonnes with about 390,000 tonnes more awaiting final confirmation pending discussions between the Cocoa and Coffee Council (CCC) regulator and cocoa grinders over the level of country discount, sources at the CCC and exporting companies said.

Ivory Coast, Ghana push cocoa industry to boost premium payments

Ivory Coast and Ghana, which together produce about two-thirds of the world's cocoa, introduced a $400 per tonne premium this season termed the living income differential to increase wages for farmers, many of whom live in poverty...

By Ange Aboa 14 May 2021

'Good level of sales'

"We are at a total of around 950,000 tonnes in sales for next season. This is a good level of sales even though there are still between 650,000 and 700,000 tonnes left to be sold to meet our objective," a CCC source said, adding that contracts should be completed by September.

Another source at CCC said the regulator was facing pressure to offer a country discount after the introduction of the LID, confirming that the country discount on contracts so far had been set at £150-200.

Ivory Coast and neighbouring Ghana, which together account for about 60% of global cocoa output, both typically sell their beans with a country premium. Both also introduced the LID scheme to boost cash for farmers.

A director of an Abidjan-based European cocoa export company said contracts had been agreed at an accelerated pace in recent weeks after the CCC agreed to cut the country premium, also known as a differential.

"The fundamentals of the global market are not favourable for us to pay both the LID and a positive differential. Either lower the LID and keep the differential or the other way around," said the manager who asked not to be named.


Reuters, the news and media division of Thomson Reuters, is the world's largest multimedia news provider, reaching billions of people worldwide every day.
Go to:

Let's do Biz