COCOBOD debunks claims of cocoa forward sales

The Ghana Cocoa Board (COCOBOD) says claims from the Minority in Parliament accusing the Chief Executive Officer (CEO) of COCOBOD of over selling cocoa forward sales was false.

In a statement issued in Accra, COCOBOD said the allocation of 338,600 metric tonnes of cocoa as a guarantee for the syndicated loan did not imply that the remaining quantity would be or had been exclusively sold at spot prices.

Forward sales serve the dual purpose of securing syndicated loans and strategically managing cocoa stocks.

The statement said at the time of determining the producer price for the 2023/24 Season, a substantial portion of the cocoa had been sold based on the reasons indicated above, therefore, the statement by the CEO was accurate and cannot be described as a lie

However, it said COCOBOD employed a diversified approach to cocoa sales, utilising forward, spot, and prepayment strategies based on market dynamics, funding, and collateral requirements.

“The use of forward sales is a deliberate strategy aimed at price risk mitigation and stock management,” it added.

It assured all stakeholders that if the final average achieved price surpasses the US$2,600 used by the Producer Price Review Committee (PPRC) in arriving at the current producer price of cocoa, due consideration will be given and addressed in favour of the hardworking farmers.

“We still remain steadfast in our commitment to ensuring a transparent and fair cocoa production and trading environment,” it added.

Source: GNA