Ghana Cocoa Board (COCOBOD) will implement a new funding model for the 2026/2027 cocoa season, marking a significant change in how Ghana finances its annual crop purchases. This new approach seeks to ensure stable cocoa prices and sustainable income for farmers.
Dr. Ransford Abbey, Chief Executive of COCOBOD, confirmed that details for this model are nearing completion. The reform aims to lessen dependence on large syndicated loans from international lenders. This reliance often required collaterizing 70% to 92% of Ghana's cocoa crop to offshore financiers.
Ghana's economy heavily depends on cocoa, a major export commodity. For over 30 years, COCOBOD has used syndicated loans secured by forward sales of cocoa. This practice provided crucial liquidity but tied up a large portion of future harvests. The new model intends to reduce this dependency and inject more capital into the local financial system.
Dr. Abbey shared these plans at the Africa Cocoa Finance & Investment Forum (ACFIF 2026) in London. He stated that the new model will feature a new pricing mechanism. This mechanism will involve quarterly reviews, covering the entire cocoa crop. This change is designed to react better to global cocoa price fluctuations and currency exchange rates.
The new financing strategy will raise capital through different financial tools, such as commercial paper and commercial notes. It will also tap into Ghana's domestic liquidity, including funds from institutional investors within the country. This shift aims to strengthen the local financial ecosystem and increase involvement of Ghanaian companies.
COCOBOD will maintain its policy of paying farmers 70% of the Free-On-Board (FOB) price. The new periodic price reviews are meant to protect farmer incomes better from unstable global prices. This balance is crucial for both farmer stability and the financial health of the cocoa sector.
The model also aims to boost participation in the cocoa economy by local processors and indigenous Ghanaian companies. This increased local involvement should lead to greater value retention within Ghana. Dr. Abbey expressed confidence in Ghana's financial system to support this transition, citing improved economic conditions.
COCOBOD will provide a detailed prospectus to stakeholders, including Licensed Buying Companies (LBCs) and investors. This document will outline opportunities for financial institutions and investors. It will be fully explained before the 2026/2027 cocoa season begins.