Cocoa smuggling from Ivory Coast falls

Less cocoa has been smuggled from Ivory Coast to neighbouring Ghana this season as there is less money to be made from contraband and production in both countries is lower than last year, exporters and analysts say. Ivory Coast, the world's biggest cocoa grower, had a record harvest of some 1.5 million tonnes in the 2003/04 season but the BCC marketing body says about 150,000 tonnes of it was smuggled abroad to avoid many of the taxes levied on the beans.
He estimated 35,000-45,000 tonnes of beans had been smuggled into Ghana by the end of the main crop, describing that as insignificant compared with the amount spirited away the previous season, most of it also during the main crop.
"The fall is due to production in Ivory Coast being lower but it's also because the money to be made on contraband has fallen significantly," he said.
One industry analyst based in London put the amount of smuggled cocoa at a similar level based on the difference between the amount Ghana had produced so far this season and the amount that had been declared for export.
"I've come to the same figure as the industry in Ivory Coast about the amount of cocoa that has been smuggled to Ghana, which is 40,000-45,000 tonnes by the end of March," he said.
Smuggling to Ghana, where the farmgate price is guaranteed, is particularly attractive when prices are low in Ivory Coast.
The official farmgate price in Ivory Coast - which is only indicative - currently stands at 390 CFA francs ($0.75) per kg and, or about 25 percent lower than the price offered in Ghana.
Last November buyers in Ivory Coast were, however, offering more for beans after a farmers' strike over low prices and days of rioting and looting in Abidjan, meaning that smuggling eased for a while.
Security has also been tightened up along the border and checkpoints have mushroomed - as a result bribes to get the smuggled cocoa through have gone up. Another factor was that some Ghanaian business figures had been stung by the fact that last season they pre-financed a lot of cocoa buying but did not receive the volumes they had hoped for - or the quality was not good enough.
That made them less inclined to take risks time, exporters said.
Official cocoa purchases in Ghana stood at 463,567 tonnes by the end of April, down 14 percent from last year. In Ivory Coast, arrivals had reached 1,041,987 tonnes by May 8, down 11 percent from the same period of the 2003/04 season.