Sources from the Coffee and Cocoa Council (CCC), Ivory Coast’s cocoa marketing board said the country has revoked the licences of two cocoa exporters- Green & Brown and Tropicao, which relinquished their contracts after they were denied bank financing.
Earlier in 2018, Ivory Coast, the world’s biggest cocoa producer toughened up conditions for awarding export licences to avoid a repeat of defaults linked to a disastrous 2016/17 season, when world market prices fell 40 percent.
A source from the CCC told Reuters that the two exporters, Green & Brown and Tropicao, returned their licences because they were heading for default due to a lack of financing. Another source revealed that their contracts were sold off immediately.
The sources told Reuters that the CCC plans to resell another 150,000 tonnes of cocoa export contracts on the verge of default in January 2019. After top exporter SAF-Cacao, one of several exporters with outstanding bank loans, was liquidated over debts owed to the CCC in July 2017, several other small exporters told Reuters they have been struggling to obtain funding from Ivorian banks.
A CCC source said “many small exporters are almost in default, so we are considering reselling their contracts”.
To set a minimum price for farmers for the October-September season, Ivory Coast sells forward most of its expected cocoa harvest.