West Africa’s cocoa belt is flashing two kinds of risk at once. In Ghana, hundreds of thousands of growers are protesting the newly set 2025/26 farm-gate price and threatening to smuggle beans across borders. Next door in Côte d’Ivoire, meteorologists flagged that the 30 days through Aug. 15 were the driest in 46 years, raising questions about pod retention into the main crop (Oct–Mar). Layer in the EU’s looming anti-deforestation rules, and the supply chain faces another turbulent season. (Reuters, Yahoo Finance)
1) The spark in Ghana: price politics and smuggling math
Ghana’s regulator set the 2025/26 farm-gate price at 51,660 cedis/ton (roughly 3,228 cedis per 64-kg bag), about a 4% lift on last season. Farmer cooperatives say that falls short of the state’s pledge to pay 70% of the FOB export price—and short of what neighboring buyers pay—reviving a smuggling incentive. Officials estimate Ghana lost ~160,000 tons to cross-border leakage in 2023/24. Protest leaders now threaten to bar officials from farms and divert harvests to Ivory Coast and Togo where net prices can be higher after transport and informal fees. (Reuters)
The cost squeeze is real. Input prices (fertilizer, agro-chemicals) surged, while disease pressure and aging trees keep yields depressed. Earlier this year, documents seen by reporters showed no increase in Ghana’s farm price for the ongoing marketing year—another flashpoint that fed into today’s revolt. Policy credibility matters: when farm-gate pricing lags world prices for too long, illicit arbitrage becomes the safety valve. (Reuters)
2) Weather whiplash in Côte d’Ivoire: the driest 30-day stretch in 46 years
Forecast outfits reported that the 30 days into Aug. 15 were the driest for Ivory Coast in 46 years—a striking statistic for the world’s top producer. The worry isn’t just rainfall totals; it’s timing. Dryness and an unusual cold spell risk poor pod retention ahead of the October main harvest, even if showers improve in September. Local farmer surveys echo the concern: pods are forming, but growers want more sun and well-timed rain, not persistent cold, to carry the crop through. (Yahoo Finance, Reuters)
This follows a roller-coaster year: excess rains late in 2024 helped spread brown-rot in some Ivorian zones; then Harmattan dryness bit in early 2025. Such weather whiplash—wet disease periods followed by dry stress—tends to cut both quantity and quality of beans, and it complicates drying/fermentation at the cooperative level. (Foreign Agricultural Service)
3) Why this matters for global supply (and prices)
Between them, Ivory Coast and Ghana produce >60% of the world’s cocoa. When both face stress—economic in Ghana, meteorological in Ivory Coast—the market pays attention. Even after a sharp cool-off from 2024’s record spike, ICE cocoa remains historically elevated; front contracts in late August have chopped around $7,500–$7,900/ton, reflecting tight physicals, liquidity frictions, and weather noise. Grind data aren’t comforting either: Ivorian July grind fell ~31% y/y, a sign of poor bean quality and low mid-crop volumes running through local plants. (USDA Apps, Reuters)
For chocolate makers, the risk isn’t just price—it’s availability of compliant, traceable beans. If Ghana’s smuggling picks up and Ivory Coast’s main crop stalls, traders will triage allocations to priority customers and origin mixes, and factories may need lower-cocoa formulations or pass-through pricing again.
4) How beans actually move: a quick supply-chain map
- Farm & first mile (Ghana, Ivory Coast): Smallholders harvest and ferment beans. Licensed buying companies (LBCs) and co-ops consolidate, then move sacks to district depots. Pricing at this stage is heavily policy-driven in both countries.
- Ports & regulator interface:
- Ghana: COCOBOD oversees marketing; forward sales and stabilization funds influence farm prices and buyer liquidity.
- Ivory Coast: The CCC (Conseil du Café-Cacao) administers export contracts; this August it trimmed main-crop forward sales to ~1.2 MMT after poor weather—signaling caution on volumes. (TradingView)
- Atlantic voyage: Beans ship to EU/UK processing hubs (Netherlands, Germany), or to U.S. grinders. Quality (moisture, mold, bean count) matters: the 2024/25 mismatch between prices and bean quality snarled grind economics, contributing to July’s grind slump in Abidjan. (Reuters)
- Butter/powder/liquor: Processors crack beans into intermediate products for confectioners and bakers. High bean prices + erratic quality can force rationing and reformulation.
5) The EU deforestation rule (EUDR): the spillovers are real
The EUDR will apply from Dec. 30, 2025 for large companies (and June 30, 2026 for SMEs), after a 12-month postponement agreed by EU lawmakers. For cocoa, that means geolocation of plots, verified deforestation-free status, and due-diligence statements to place product on the EU market. Several member states are still lobbying for simplifications, and big brands have asked for more time, but the broad direction is set. (Consilium, EU Trade, Reuters)
On the ground, compliance isn’t free. Small Ivorian firms estimate ~200 CFA/kg (~$0.36) in added costs for traceability and documentation—material for thin-margin co-ops. The Ivorian government is rolling out digital farmer IDs and mobile payments for some 900,000 growers to help meet the standard, but smaller exporters warn they could be squeezed out by better-capitalized multinationals unless there is bridge support. Meanwhile, parts of industry (e.g., Mondelez, Lavazza) continue to press for another delay, citing readiness gaps. (Reuters)
Why it matters now: If smuggling spikes, traceability breaks. Beans crossing informal routes risk being untraceable and may become non-compliant for EU buyers—the world’s largest chocolate market. That could push more of West Africa’s crop toward non-EU destinations or deepen discounts for non-compliant lots, complicating cash flows for co-ops and farmers. (Financial Times)
6) Micro-mechanics of the coming months: what to watch
- Farmer actions in Ghana. The scale and persistence of protests will determine whether LBCs and extension officers can operate normally—and whether the 2025/26 purchases begin smoothly in October. Track any move by Accra to re-adjust the farm-gate price or tweak subsidy schemes. (Reuters)
- Rainfall and sunshine in Ivory Coast (late Aug–Sep). The “driest 30-day” signal is serious, but September can still rescue pod development if sun/rain balance improves. Local farmer commentary is already pleading for more sun and moderate showers, not downpours. (Yahoo Finance, Reuters)
- Forward sales and arrivals. CCC’s reduced forward contract volumes for the main crop hint at a regulator hedging its bets on supply. Watch port arrivals from October and any adjustments in main-crop purchasing schedules. (TradingView)
- Grind rates and product spreads. The 31% y/y drop in July grind in Ivory Coast underscores how bean quality can throttle processing. If EU grind holds steady while origin grind drops, it implies tighter origin supply/quality and potential basis volatility for butter vs powder. (Reuters)
- Policy noise on EUDR. Despite the formal delay to Dec 2025, member-state pressure continues. Any additional tweaks (risk-based country categorization, documentation relief) will shape which origins get preferential market access and pricing. (Reuters)
7) The market lens: prices, liquidity, and compliance premia
Cocoa’s price is still high in historical terms even after a big retracement from the 2024 blow-off top. Front-month ICE cocoa has been printing ~$7,600–$7,900 lately, with wide daily ranges and thinner open interest than in calmer years. Liquidity dislocations since the 2024 spike mean spreads can gap on headline weather or policy shocks. Expect compliance premia to widen into late 2025: EU-eligible, fully traceable cocoa may command better terms than non-compliant lots, especially if EUDR goes live on schedule. (Reuters, Trading Economics)
Critically, there is no single “cocoa market.” You have beans by origin and quality, and you have compliance classes emerging. A Ghana farmer revolt that fuels smuggling could reduce the share of Ghana-origin beans that are easily certifiable, even if headline production holds—tightening the pool accessible to EU buyers and shifting flows elsewhere.
8) Big-picture implications (without investment advice)
- For producers: Durable solutions look political (real farm-gate reform, input support) and agronomic (replanting, disease management, shade systems). In the near term, price alignment across borders is the only reliable brake on smuggling.
- For processors & brands: Dual track your sourcing: prioritize traceable West African supply while cultivating optionality in LatAm/Asia. EUDR readiness (mapping smallholder plots, robust due-diligence statements) is now a source of procurement alpha.
- For policymakers: Enforcement that ignores farm economics can backfire. If legal channels underpay, beans migrate into the shadows. Calibrating farm-gate pricing and bridge finance for small co-ops to meet EUDR could reduce leakage and stabilize incomes.
Bottom line
Cocoa spent 2024 proving that supply chains matter. 2025/26 may prove that governance matters just as much. If Ghana sticks to a farm-gate that growers reject, smuggling will climb and traceability will fray. If Ivory Coast’s late-wet-season dryness persists, the main crop will underwhelm. And if the EU’s deforestation rule bites on schedule, buyers will pay up for compliant beans, deepening the divide between well-mapped supply and everything else. For an industry that relies on millions of smallholders, weather and policy are now equally potent drivers of risk. (Reuters, Yahoo Finance, Consilium)
Sources
- Ghana farmer protests, farm-gate price & smuggling estimates. (Reuters)
- Ivory Coast weather: “driest 30 days to Aug. 15 in 46 years” (Commodity Weather Group); cold-spell reports; farmer sun/rain needs. (Yahoo Finance, Reuters)
- Share of global supply: USDA FAS—Ivory Coast & Ghana together >60% of world cocoa. (USDA Apps)
- Forward sales trimmed: CCC cut main-crop export contracts to ~1.2 MMT on weather concerns. (TradingView)
- Grind slump: Ivory Coast July grind −31.2% y/y (GEPEX). (Reuters)
- Price levels/liquidity context: ICE cocoa futures quotes & dashboards (late Aug 2025). (Reuters, Trading Economics)
- EUDR timing & pressure to delay further: Council adoption (Dec. 2024) → Dec. 30, 2025 start for large firms (SMEs June 30, 2026); continuing member-state/industry pushback. (Consilium, EU Trade, Reuters)
- Compliance costs & traceability rollout in Ivory Coast: small firms’ cost estimates; farmer ID & mobile-payment system. (Reuters)
Educational disclosure
The information above is for general informational and educational purposes only and does not constitute investment, financial, legal, or tax advice. Cocoa market conditions change quickly; please verify all key facts and figures directly from the cited primary sources (government releases, recognized newswires, and official datasets) before relying on them. We do not recommend buying, selling, or using any specific security, commodity, or strategy. If you need advice tailored to your circumstances, consult a licensed professional in your jurisdiction.