Story By: Akua Oteng Amponsah
Ghana’s Cocoa Board (Cocobod) has warned that local Licensed Buying Companies (LBCs) face possible extinction unless urgent financial support is provided.
Acting CEO Dr. Randy Anerley Abbey disclosed that Cocobod has not secured a syndicated loan for the 2025/2026 crop season, triggering a financing crisis for local cocoa buyers.
“Something is happening with the LBCs, especially the indigenous ones, which has to do with the fact that we are not doing the syndicated loan,” Dr. Abbey said.
Under the syndicated loan, Cocobod creates seed money for LBCs to purchase cocoa beans. However, without the loan, local LBCs are struggling to operate.
Dr. Abbey explained that while avoiding the syndicated loan may save Cocobod some financing costs, the move is having devastating consequences for smaller, local players. “Although it is saving Cocobod in terms of financing cost… if we were to go for a syndicated loan, Cocobod would be looking at maybe GH¢3 billion or GH¢3.5 billion,” he said.
In response to the looming crisis, Cocobod has engaged the Bank of Ghana for a possible policy intervention using the Cash Reserve Ratio. Dr. Abbey proposed that 2-3% of banks’ mandatory reserves could be allocated to support indigenous cocoa buyers.
“Can we look at apportioning 2% or 3% of this Cash Reserve Ratio just to support indigenous LBCs?” he asked.
He suggested that any such funds be restricted exclusively for cocoa purchases. “We can restrict it to cocoa purchases, just to ensure that they also don’t go using it for oil, tin tomatoes, and all those things,” Dr. Abbey said.
Dr. Abbey expressed hope that a positive response from the central bank would provide a lifeline to struggling local cocoa buying firms.
“We believe that if there’s a positive response, it will be able to help, especially the indigenous LBCs. Otherwise, if we continue with this financing model, I fear that most of them might go extinct,” he warned.
Cocobod is shifting to a 60-40 financing model with international buyers for the 2025/26 season, and Dr. Abbey has been engaging buyers directly in Europe and North America.
