Ghana’s Cocoa Sector is set for a major financial transformation as the Ghana Cocoa Board (COCOBOD) prepares to roll out a new funding framework aimed at stabilising producer incomes and strengthening long-term sustainability.
The reform, which will take effect from the 2026/2027 crop season, is expected to reshape financing, pricing, and investment structures within the Cocoa Sector, marking one of the most significant policy shifts in decades.
Speaking at the Africa Cocoa Finance & Investment Forum 2026 at the London Stock Exchange, COCOBOD Chief Executive Randy Abbey revealed that the Cocoa Sector has long depended on syndicated loans backed by forward sales to finance cocoa purchases.
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He explained that while the arrangement has ensured liquidity, it has also resulted in 70% to 92% of Ghana’s cocoa crop being tied to offshore financiers, limiting domestic control over earnings and financing.
“The Cocoa Sector requires a paradigm shift to reduce dependency on external collateralisation,” Dr Abbey stated.
Under the proposed model, the Cocoa Sector will adopt a revised pricing structure involving periodic reviews—likely quarterly adjustments—based on global cocoa prices and exchange rate movements.
The system will maintain the policy of paying farmers 70% of the Free-On-Board (FOB) price while allowing flexibility to reflect market conditions.
Dr Abbey said this approach is designed to strike a balance between farmer income stability and financial sustainability in the Cocoa Sector.
The new framework will introduce innovative financing tools such as commercial paper and commercial notes, supported by domestic liquidity and institutional investors.
According to COCOBOD, this will help deepen local participation in the Cocoa Sector, improve financing access for indigenous processors, and retain more value within Ghana’s economy.
Dr Abbey expressed confidence that Ghana’s financial system is well-positioned to support the transition, citing improved macroeconomic stability and rising investor interest in structured financial instruments.
He also acknowledged concerns from Licensed Buying Companies and other stakeholders, noting that a detailed prospectus will be released ahead of implementation to clarify participation structures in the Cocoa Sector.
The COCOBOD boss stressed that the ultimate goal of the reform is to protect cocoa farmers from global price volatility while ensuring predictable and fair income flows.
The initiative is expected to enhance resilience across the Cocoa Sector, improve financing efficiency, and strengthen Ghana’s position in the global cocoa market.
The forum, organised by Cocoa Trade and Invest Africa in partnership with the International Cocoa Organization, highlighted growing international support for reforms across Africa’s cocoa-producing economies.