Cocoa exporters and traders said on Monday that a lack of transparency surrounding a wave of export contract defaults in Ivory Coast has shaken their confidence in the top grower's marketing board. The Coffee and Cocoa Council (CCC) last week acknowledged that some exporters, having wrongly speculated that world cocoa prices would extend years-long gains, would default on loss-making contracts.
The admission, delivered by CCC Director Massandje Toure-Litse on Ivorian state television on Friday, was an abrupt U-turn by the marketing board, which for months had repeatedly denied reports that defaults were on the horizon.
"When the first rumours surfaced in September, she said it was nothing. But four months later, she recognises the problem," said the director of an international exporter in Abidjan. "The CCC talks to no one and always says everything is fine when we can see for ourselves that's not the case."
The CCC, which did not immediately respond to a Reuters request for comment, began sending letters to exporters in default last week.
"If it's just 100,000 tonnes of defaults, that can be sorted out quickly. But if it's more than 300,000 tonnes, it will be hard to manage," said one international trader.
The CCC has still given no indication of the total volumes in default, however, leading many to complain of a lack of transparency.