Cocoa purchases declared by private buyers to Ghana's industry regulator Cocobod reached 13,613.8 tonnes in the first eight weeks of the 11-week light crop, down 3.1 percent year on year, an industry source said on Tuesday. Purchases for week 8, ending August 21, totalled 1,697 tonnes, up from 1,055 tonnes in the previous week but down from 1,908 tonnes bought in the corresponding week of last year's light crop, the source said.
The shortfall dragged this year's cumulative total below comparative figures for last season's modest light crop. Purchases in the first eight weeks of last year's light crop were 14,054 tonnes. After hopes for a strong light crop harvest, purchases have dropped off due to unfavourable weather conditions and smuggling of beans over Ghana's western border into the Ivory Coast.
"The downturn was dramatic," said the source, who did not wish to be identified due to sensitivities over cocoa crop data in Ghana, the second biggest producer after Ivory Coast. "The rains came but just before the month of July when the light crop is formed, it stopped raining in the cocoa belt where we needed it most, so the growth process was strangled."
A leading buyer told Reuters the light crop harvest, which is due to end in September, might not exceed 20,000 tonnes. This year's light crop, the second of Ghana's two-cycle cocoa season, started on June 27 and was initially forecast at 50,000 tonnes, up from less than 27,000 last year.
The Cocobod later raised its target to 60,000 tonnes before cutting it to 40,000 tonnes due mainly to smuggling to Ivory Coast, where prices fluctuate with international markets and supply and demand conditions on the ground. Prices paid in some parts of Ivory Coast in recent weeks have represented a premium of 35 percent or more above Ghana's fixed prices of 1.20 cedis ($1.04) per tonne, despite Ghana's cocoa being generally regarded as better quality.
Ghana made a rare mid-season price increase of over 25 percent in February, and Cocobod officials have hinted they may raise the price for the new main crop starting in October. "Ivory Coast will soon start the main crop season and they will be paying better prices that can affect us and we must not allow that to happen," the source said.
There have been rumours of farmers hoarding cocoa in hope of a price rise, but the buyer said that was not the case. "We don't have cocoa on the farms, it's just not there," the buyer said. The main crop, which ran from mid-October to June 5, totalled 663,558 tonnes, up 12.9 percent on the previous season and up from an initial Cocobod forecast of 600,000 tonnes.