Ghana lost 160,000 tons of cocoa to smuggling in 2023/24 season

Ghana has lost more than a third of its 2023/24 cocoa output to smuggling, a top official from the cocoa marketing board (COCOBOD) told Reuters, as low local prices and payment delays push some farmers to sell to increasingly sophisticated trafficking rings.

Poor harvests in Ghana and Côte d’Ivoire, the world’s second largest and largest producers, have pushed markets into a four-year supply deficit, driving up global cocoa and chocolate prices this year.

But cocoa fetches more in Côte d’Ivoire and Togo than in Ghana because of a more stable CFA franc currency and a less regulated sector.

Ghana had produced 429,323 metric tons of cocoa by the end of June from the start of the season in September, less than 55% of the average at the same point in previous seasons and putting 2023/24 output on track for its biggest fall in more than two decades.

Charles Amenyaglo, director of special services at COCOBOD, who leads the board’s anti-smuggling task force, said smuggling losses more than tripled in 2023/24.

“Conservatively, I will say we lost 160,000 tons,” he said, adding that the task force also intercepted about 250 tons, up from 17 tons in 2022/23.

“The data is alarming,” said Abubakar Omae, general secretary of Ghana’s cocoa and coffee farmers association.

While more than 10 people have been sentenced to between three months and 10 years in prison for smuggling this year, Amenyaglo said Ghana’s military will soon be deployed to tackle smugglers.

FUEL TANKERS, OIL DRUMS AND TIPPER TRUCKS

Smuggling rings, which offer farmers higher prices, began to take hold in 2022, when Ghana was at the height of an economic and currency crisis.

Amenyaglo said significant quantities of cocoa were crossing into Togo, Burkina Faso and even Mali.

“We’ve seen cocoa in tipper trucks covered by quarry chippings and in drums disguised as palm oil,” he said. “We’ve seen pontoon boats carting cocoa…but the shocker is when we saw a fuel tanker loaded with cocoa. The ‘Don’t tamper’ seal was still on.”

COCOBOD has failed to pay for beans on time during the season due to problems with the syndicated loan it uses to finance purchases.

“This comes back to (the) money issue … If we’re liquid and actively on the field, smuggling can be curtailed,” said Samuel Adimado, president of the Ghanaian cocoa buyers’ group.

Ghana opened the 2024/25 season earlier than usual, with a new funding model and a 45% increase in the farmgate price.

Farmers are hopeful the changes will help discourage smuggling, though they fear a weakening currency will erode the price hike.

“We’ve invested a lot to raise cocoa production in Ghana, not for cocoa sectors in Togo or Ivory Coast to blossom,” Amenyaglo said.

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