"We are in a price crisis. The past six months have been terrible and the forecast is worse," Luis Valverde said. He was speaking at a news conference following an emergency meeting of the ICCO's producer country members aimed at finding solutions to help boost prices. "The number one point that we all agree is that all the decisions that we make regarding our production are not as they used to be. We cannot make sole decisions. We must make decisions as a group," he said.
Valverde said that in addition to coordinating production to control supply, the ICCO, which groups both consumer and producer countries, was also discussing strategies to foster increased consumption. After years of steadily rising prices, the rapid decline has dealt a major blow to the economies of the world's top cocoa growers in West Africa. Joseph Boahen Aidoo, the CEO of Ghana Cocoa Board, told reporters that the price drop had cost his country nearly $1 billion in export revenues. Ghana is the world's number two producer.
In neighbouring Ivory Coast, the top grower, the government has been forced to slash budget spending by 10 percent. It lowered its guaranteed farmer price to 700 CFA francs ($1.15) per kg for the April-to-September mid-crop from 1,100 CFA francs during the main crop harvest.
However, Ivory Coast's Agriculture Minister Mamadou Sangafowa Coulibaly told reporters that concerns that a reserve fund designed to buffer against price fluctuations would be overwhelmed by the crisis were unfounded. "Today it's clear we have reached the end of the main crop, we didn't have any problem with support payments," he said. "It is a question, I believe, that is behind us It shows that our reserve fund system is robust if it has resisted a 35 percent drop in prices."
Copyright Reuters, 2017