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Drop in Ghana’s currency spurs cocoa smuggling to Ivory Coast

Drop in Ghana’s currency spurs cocoa smuggling to Ivory Coast

From Reuters

Smugglers have trafficked around 40,000 tonnes of Ghanaian cocoa beans into top grower Ivory Coast since November to take advantage of a drop in Ghana’s cedi currency, exporters and merchants said.

Cocoa smuggling between the two countries is common but over the past decade it has mainly involved Ivorian beans being taken illegally to Ghana, the world’s second largest producer, where the government buys output at a fixed price.

However, Ivory Coast abandoned a decade of sector liberalisation last season and introduced a minimum price for farmers, a measure that has helped to reduce illicit exports.

Exporters said the Ivorian price is now seen as more attractive by Ghanaian farmers, who can make bigger profits selling their output to smugglers.

While the volumes of beans being smuggled into Ivory Coast currently represent only a fraction of total output, Ghana risks losing millions of dollars in cocoa revenues if it fails to stabilise its struggling currency.

“We estimate everything that has come in (from Ghana) at 40,000 tonnes at least,” the purchasing manager of an Abidjan-based exporter said on Friday.

Written by Ange Aboa | Read more at Reuters