The Ghana Cocoa Board (COCOBOD) is finalising a new funding model for the cocoa sector aimed at ensuring price stability and sustainable incomes for cocoa farmers ahead of the 2026/2027 crop season.
Chief Executive of Ghana Cocoa Board, Dr Randy Abbey, announced the development during a high-level panel discussion on Pre-Export Liquidity and Long-Term Capital at the Africa Cocoa Finance & Investment Forum 2026 held at the London Stock Exchange.
According to Dr Abbey, Ghana’s cocoa industry has for more than 30 years depended on syndicated loans backed by forward cocoa sales to finance annual cocoa purchases. While the arrangement has provided the liquidity needed to sustain cocoa purchases, he said it has also resulted in a substantial portion of Ghana’s cocoa production being tied to offshore financiers.
“While effective in providing liquidity, it also required between 70 per cent and 92 per cent of the cocoa crop to be collateralised to offshore financiers, underscoring the urgent need for a paradigm shift in policy,” he stated.
Dr Abbey explained that the new financing framework would introduce a revised pricing mechanism involving periodic reviews, possibly on a quarterly basis, to determine producer prices throughout the crop season.
“The new funding model will come with a new pricing mechanism which will involve periodic reviews, maybe quarterly, and will be used for the entire crop,” he noted.
He indicated that the proposed model would raise capital through instruments such as commercial paper and commercial notes while tapping into domestic liquidity and support from institutional investors.
The COCOBOD Chief Executive stressed that the reforms would maintain the existing policy of paying cocoa farmers 70 per cent of the Free-On-Board (FOB) price while allowing price adjustments to reflect changes in global cocoa prices and exchange rates.
He said the reforms were intended “to strike a careful balance between income stability for farmers and the financial sustainability of the cocoa sector.”
Dr Abbey further noted that the new framework would expand participation in the cocoa economy, improve financing opportunities for local processors and indigenous Ghanaian firms, and increase value retention within the country.
He expressed confidence in Ghana’s financial sector to support the transition, citing improving macroeconomic conditions and growing investor appetite for structured financial instruments.
Dr Abbey acknowledged concerns raised by stakeholders, particularly Licensed Buying Companies and investors, over the structure and scale of the proposed financing arrangement. However, he assured participants that a detailed prospectus outlining participation opportunities was being finalised and would be fully explained before the commencement of the 2026/2027 crop season.
He added that the reforms were expected to shield cocoa farmers from the impact of volatile global cocoa prices.
The forum was organised by Cocoa Trade and Invest Africa in partnership with the International Cocoa Organization and the United Kingdom office of the Cocoa Marketing Company to promote reforms and investment in Africa’s cocoa sector.
