The Chief Executive of Ghana Cocoa Board (COCOBOD), Dr. Ransford Abbey, has disclosed that modalities for a new cocoa sector funding model are nearing completion ahead of its implementation in the 2026/2027 crop season.
He said the new model marks a major shift in Ghana’s cocoa financing strategy and seeks to ensure price stability and sustainable farmer income.
Dr. Abbey made this known during a high-level panel discussion on Pre-Export Liquidity & Long-Term Capital at the Africa Cocoa Finance & Investment Forum (ACFIF 2026), held at the London Stock Exchange.
Dr. Abbey explained that Ghana’s cocoa sector has, for over three decades, relied on syndicated loans backed by forward cocoa sales to finance annual crop purchases. According to him, although the model ensured access to liquidity it also required that between 70% and 92% of the cocoa crop be collateralised to offshore financiers, underscoring the urgent need for a paradigm-shift in policy.
“The new funding model will come with a new pricing mechanism that will involve periodic reviews – maybe quarterly – and will be used for the entire crop,” he said.
According to the Chief Executive, this model focuses on mobilising capital through instruments such as commercial paper and commercial notes while tapping into domestic liquidity, including institutional investors.
He further explained that the proposed reform will maintain the policy of paying farmers 70 percent of the Free-On-Board (FOB) price, while introducing periodic price reviews to respond to movements in global cocoa prices and exchange rates. The objective, he said, is to strike a careful balance between income stability for farmers and the cocoa sector’s financial sustainability.
The model is also expected to broaden participation in the cocoa economy by creating greater financing access for local processors and indigenous Ghanaian companies, strengthening value retention within the country.
The COCOBOD CE expressed confidence in the strength of Ghana’s financial ecosystem to support this transition, citing improving macroeconomic conditions and growing investor interest in structured financial instruments.
Dr. Abbey further acknowledged the need for clarity among stakeholders – particularly Licenced Buying Companies (LBCs) and the investor community – regarding the structure and scale of funding support under the new model.
He indicated that a detailed prospectus outlining participation opportunities for financial institutions and investors is being firmed-up, adding that its contents will be fully explained to key stakeholders ahead of the 2026/2027 crop season opening.
He expressed optimism that the incomes of Ghanaian cocoa farmers will be better protected from global cocoa price volatility in the years ahead.
Meanwhile, the Africa Cocoa Finance and Investment Forum (ACFIF) 2026 was convened by Cocoa Trade and Invest Africa in partnership with the International Cocoa Organization (ICCO) and United Kingdom office of the Cocoa Marketing Company (CMC UK) – bringing together policymakers, investors and industry stakeholders to advance reforms and unlock investment across Africa’s cocoa sector.
Post Views: 13
Discover more from The Business & Financial Times
Subscribe to get the latest posts sent to your email.
