Gov’t to Fund Cocoa Purchase with Domestic Cocoa Bonds
The government of Ghana has announced plans to purchase cocoa and repay with cocoa proceeds within each crop year using Domestic Cocoa Bonds.
This is part of reforms to be implemented by the government under a new Financing Model, announced by Finance Minister Cassiel Ato Forson.
At a presser on February 12, 2026, he said the Bonds will be used to raise a revolving fund for COCOBOD to turn around at least once during the season.
“With this new financing model, COCOBOD can sell beans of any volume to local processing companies to promote value addition and job creation.”
It also noted the new financing model will revive the indigenous Licensed Buying Companies (LBCs) and state-owned Produce Buying Company (PBC).
The government intends to make PBCs the leading Licensed Buying Company (LBC) in the cocoa sector.
A new financing model has become necessary after the country delayed payment to farmers due to the current model.
This model takes its root from the deterioration of COCOBOD’s finances in 2022, which resulted in a default and restructuring of the Cocoa Bills in 2023, he explained.
“For the first time, in 2023, the annual syndication suffered significant delays due to loss of confidence in the Ghanaian economy. The first tranche was received on 22nd December 2023, four months after the commencement of the season. COCOBOD projected an output of 800,000 tonnes, and committed 786,672 tonnes in contracts in the 2023/24 crop season. However, actual production was 432,145 tonnes, a deviation of 45% from the projected output.
“Variations in crop forecasts typically vary between 5% to 15%. Hence, a deviation of 45% was unprecedented. This resulted in huge rollover contracts of 333,767 tonnes at an average price of US$2,661 per tonne.”
This resulted in over US$1 billion loss that year and continued into 2024, where COCOBOD could not pay the final tranche of the syndicated loan due in July 2024.
According to him, the Finance Ministry intervened with a US$70 million bridge financing to avert a default.
The amount was, however, not paid by COCOBOD.
Story by Hajara Fuseini
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