Ghana's Cocobod to ask traders to pre-finance bean purchases in new funding model
By Maxwell Akalaare Adombila
ACCRA, Aug 23 (Reuters) -Ghana's cocoa marketing board, Cocobod, is fine-tuning a new funding model for bean purchases that will require global traders to deposit at least 60% of the value of their forward contracts at the start of the season, two sources told Reuters.
The new system will replace a three-decade old pre-export syndicated loan from international banks, which Cocobod said this week it would not raise for its 2024/25 cocoa season for the first time since 1992.
Ghana, the world’s second biggest cocoa producer after Ivory Coast, previously used the loan to finance bean purchases from farmers and shore up its reserves, helping to cool pressures on the cedi currency.
But Cocobod paid a record 8% interest on last year’s loan and now expects the new funding model to save it over $150 million in interest payments.
Under the new system, part of a trader’s deposit will be used to fund purchases from farmers via an existing partnership with a licensed cocoa buying company (LBC).
In this way, traders will work with LBCs by funding them to buy the cocoa, while Cocobod will act as an intermediary, said the source, requesting anonymity as they were not authorised to speak on the issue.
"Basically, we are saying traders work with LBCs and if so, they must fund them to buy the cocoa, but Cocobod will act as the intermediary," said the source, requesting anonymity as they were not authorised to speak on the issue.
"DON'T LEAVE ANYBODY BEHIND"
Much of Ghana's cocoa is bought by large, diversified trade houses with deep pockets, including Olam, Barry Callebaut, Cargill, Touton and Ecom.
Traders typically sign deals to buy beans - like any other commodity - months in advance in the hope of reselling later at a profit.
"With this (new) model, the trader pays the remaining 40% (of the contract sum) when picking the cocoa," the Cocobod source said.
Cocobod is yet to decide with traders if the pre-financing should attract interest or discount on beans supplied, it said.
President of LICOBAG, Samuel Adimado said if well-implemented, the model could address perennial delays in payments by Cocobod, raise buyers’ margins and reduce their costs with a potential reduction in bank loans to fund purchases.
"It requires discipline;if there's no cocoa, LBCs shouldn’t be given money. If the LBC receives money but can't find cocoa, it must return it. If these are properly applied, perfect," Adimado said.
Unlike multinational LBCs, local cocoa buyers lack trader partners, putting them at a potential disadvantage. Adimado said the model must recognise this.
"The question is, what will be the arrangement for them? It's very important to take care of the indigenous LBCs and strengthen them so that we don't leave anybody behind."
Cocobod will launch the 2024/25 season on Sept. 1, earlier than usual, with a reduced production target of 650,000 tonnes.
Reporting by Maxwell Akalaare Adombila
Editing by Alessandra Prentice and David Evans
면책조항: XM Group 회사는 체결 전용 서비스와 온라인 거래 플랫폼에 대한 접근을 제공하여, 개인이 웹사이트에서 또는 웹사이트를 통해 이용 가능한 콘텐츠를 보거나 사용할 수 있도록 허용합니다. 이에 대해 변경하거나 확장할 의도는 없습니다. 이러한 접근 및 사용에는 다음 사항이 항상 적용됩니다: (i) 이용 약관, (ii) 위험 경고, (iii) 완전 면책조항. 따라서, 이러한 콘텐츠는 일반적인 정보에 불과합니다. 특히, 온라인 거래 플랫폼의 콘텐츠는 금융 시장에서의 거래에 대한 권유나 제안이 아닙니다. 금융 시장에서의 거래는 자본에 상당한 위험을 수반합니다.
온라인 거래 플랫폼에 공개된 모든 자료는 교육/정보 목적으로만 제공되며, 금융, 투자세 또는 거래 조언 및 권고, 거래 가격 기록, 금융 상품 또는 원치 않는 금융 프로모션의 거래 제안 또는 권유를 포함하지 않으며, 포함해서도 안됩니다.
이 웹사이트에 포함된 모든 의견, 뉴스, 리서치, 분석, 가격, 기타 정보 또는 제3자 사이트에 대한 링크와 같이 XM이 준비하는 콘텐츠 뿐만 아니라, 제3자 콘텐츠는 일반 시장 논평으로서 "현재" 기준으로 제공되며, 투자 조언으로 여겨지지 않습니다. 모든 콘텐츠가 투자 리서치로 해석되는 경우, 투자 리서치의 독립성을 촉진하기 위해 고안된 법적 요건에 따라 콘텐츠가 의도되지 않았으며, 준비되지 않았다는 점을 인지하고 동의해야 합니다. 따라서, 관련 법률 및 규정에 따른 마케팅 커뮤니케이션이라고 간주됩니다. 여기에서 접근할 수 있는 앞서 언급한 정보에 대한 비독립 투자 리서치 및 위험 경고 알림을 읽고, 이해하시기 바랍니다.