Stock up on chocolate: Cocoa farmers strike

Pauline Bax

ABIDJAN, Ivory Coast — Cocoa farmers across Ivory Coast went on strike Monday, holding back their crops to protest low retail prices and high export taxes. If the action is sustained it could affect the global chocolate industry.

The West African country is the world’s top grower of cocoa beans, producing 40 percent of global output each year, according to government statistics, despite being split following a civil war.

“The strike is on ... we called on the farmers to hoard their beans,” Koffi Kanga, a representative of the country’s cocoa farmers association, said by telephone from San Pedro, Ivory Coast’s second-largest cocoa port after the commercial capital of Abidjan.

The action comes days after authorities officially opened the harvesting season by announcing a retail price of 80 cents a kilogram, roughly 40 cents a pound. Cocoa association President Henri Amouzou said the farmers are seeking $1.15 a kilogram (57 cents per pound).

Union leaders said they planned to stop trucks carrying cocoa and other farm products such as papayas and bananas to Abidjan until the price is raised. However, trucks continued to arrive at the Abidjan port Monday, and it was not immediately clear if any export shipments had been delayed.

Analysts said a strike might have to stretch out for weeks before it would affect world supplies and prices.

“Typically these strikes have minimal impact, because they’re never long-lasting,” said Judy Ganes-Chase, an independent U.S. analyst of cocoa, coffee and other soft commodities. “It’s only the start of the season.”

Ganes-Chase said cocoa beans could succumb to mold while being stored during the strike, but that these losses would not be very large.

Ivory Coast’s 700,000 increasingly impoverished cocoa farmers say they don’t make enough money to send their children to school.

Although the government’s set price often doesn’t match what farmers are actually paid, it sets a benchmark for farmers who plan to sell their beans to local buyers.

Amouzou said farmers also want the government to slash the main cocoa export tax by 45 percent to allow local buyers and exporters to pay farmers a higher price.

Current export taxes are about 40 cents per kilogram (20 cents per pound). Cocoa taxes are the main source of government revenue and have been used to buy arms and military equipment, according to U.N. experts.

Most cocoa farms are in the fertile south of Ivory Coast and were less affected than other areas of the country by civil war that broke out after a failed coup four years ago. The nation has since been split between a government-controlled south and a rebel-held north.

Finance Minister Charles Diby Koffi said this month the government would not reduce taxes this season.

“The country is still in crisis,” he said.

Rohit Savand, a commodities analyst with New York’s CPM Group, said a price increase would be hard to come by considering that favorable weather has increased Ivory Coast’s cocoa supply significantly this year.

About 20,000 metric tons of cocoa arrived at Ivory Coast’s ports in the first week of October, up from about 9,000 the previous year, he said. Ghana, another major producer, also expects a large crop.

Associated Press writer Heidi Vogt contributed to this report from Dakar, Senegal.

(Associated Press)