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Feb
17

BAN ON COCOA EXPORTS IS ALSO HURTING THE IVORY COAST

COTE D’IVOIRE: Cocoa ban latest worry for growers

ABIDJAN, 17 February 2011 (IRIN) –

An embargo on the export of cocoa beans in Côte d’Ivoire is curbing income for the country’s 900,000 growers, the latest to be caught in the crossfire of the political fallout.

Presidential claimant Alassane Ouattara on 23 January called for a month-long ban on cocoa exports, one of several tactics being deployed by his internationally recognized government to increase pressure on Laurent Gbagbo, who refuses to quit office.

Analysts say most of the estimated US$120 million needed to run a skeleton economy – paying salaries at the expense of infrastructure and development – usually comes from the key sectors of cocoa and petroleum. Cocoa brought in US$1 billion in foreign exchange receipts in 2006, versus $1.3 billion from oil and other refined products, according to the International Monetary Fund (IMF).

About six million Ivoirians rely on cocoa production to survive. The country exported 1.2 million tons last year, roughly 40 percent of global supply, according to the International Cocoa Organization (ICC). But as the Ivoirian economy continues to be hit by political turbulence, any targeted financial measures will require a delicate balancing act to avoid squeezing vulnerable farmers.

Many growers said they support the ban, but remained anxious about how long it would last. Although the main cocoa harvest is collected from September to March, another smaller crop is gathered between March and August.

“The majority of us are smallholders from the north or centre of the country. These are the people who feel the ban is all part of the process of a revolution,” Maurice Savadogo, a cocoa farmer in the eastern town of Abengourou, told IRIN.

Ouattara’s popular support is strongest in the north of the country. His November win was the result of an alliance with former president Henri Konan Bédié, who garnered large pockets of votes in central-eastern regions of the country.

“But if the ban is extended until March, things will be enormously difficult for us. At the end of the day we are just planters; we feel very vulnerable,” Savadogo said.

Latest headache

Gbagbo’s government has described the ban as an attempt by Ouattara’s government to illegally impede growth in a vital industry where production is on the rise. “Forecasts for this season’s harvest could top 1.2 million tons,” Gbagbo spokesperson Ahoua Don Mello told reporters, saying Ouattara’s request to ban cocoa exports was “disastrous”.

The current financial squeeze means growers have not been able to benefit from the tail end of a bumper crop forecast this year. Cocoa beans registered for export at the country’s ports were up 16 percent year-on-year, reaching 905,000 tons in the week ending 30 January, figures from the cocoa and coffee board (BCC) show.

“Growing conditions this year have been ideal for a good harvest”, farmer Blaise Ouraga from the western growing belt of San Pedro told IRIN. “But the cost of fertilizers and weed-killers is unaffordable for us these days. And that’s not surprising when you see that the cost of transport, food, everything has gone up in the last couple of months. A ban is the latest headache.”

Black market

Meanwhile, middlemen who buy the beans from farmers have used the ban to undercut the BCC recommended farmgate price – the price farmers are paid for their produce, set at roughly two US cents per kilo. A black market has sprung up for those wanting to cash in on the jumbo crop, Fulgence N’Guessan, president of the Union of Cooperatives of Côte d’Ivoire (Ucopexi), told IRIN.

N’Guessan said 2,000 tons of cocoa had been transported out of the bush in the last two weeks, with farmers being forced to accept prices of around one US cent per kilo of beans.

“Farmers don’t have the conditions to keep beans for more than about three weeks. Some prefer to sell at a low price rather than risk not being able to sell mouldy beans at all later.”

“And the buyers factor in the risk they are taking, the fact they’re using their own personal money and so on, to push down the prices,” N’Guessan, who also runs export company Kavokiva, told IRIN.

Official BCC figures put average farmgate prices at 1.7 US cents per kilo for the week ended 31 January.

In Abidjan’s usually bustling port, dozens of lorries are parked – the most visible sign of European Union financial sanctions. Their drivers, who transport produce inland as well as to landlocked neighbouring countries Burkina Faso, Mali and Niger, sleep underneath the vehicles as they wait for business to pick up again.

“It’s just a shame that ordinary citizens have to suffer the brunt of a political crisis that should have been over by now,” said Adamu (not his real name), an official at an international cocoa company, gesturing at the eerily quiet port. Most multinationals have respected Ouattara’s request and are laying low, he added.

“The industry is worth billions, so of course beans are still being bought. There are big warehouses at the port that can store beans for a long time, but because it’s all unofficial farmers aren’t being paid a good price.”

Cocoa continues to leave the country via established smuggling routes to the east in Ghana or northwards to Burkina Faso, Adamu added, echoing reports from other farmers and cooperative owners.

“It is those farmers who are feasting at the table of those dominating politics who are benefiting from this situation,” said a grower in Daloa, the heart of the cocoa belt. “They’re a minority, but they’re the ones crying loudest for the ban to end while benefiting,” he told IRIN.

mm/cb
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