Ivory Coast limits fresh cocoa purchases from two major traders

Top cocoa producer Ivory Coast is restricting some multinational traders from additional bean purchases for exports as the country seeks to avoid a shortage, according to the head of the local regulator.

Regulatory body Le Conseil Cafe Cacao — known as CCC — has blocked Cargill Inc. and Barry Callebaut AG from buying more beans after both traders reached the amounts stipulated in their current contracts, CCC Managing Director Yves Kone said by phone. It is part of an effort to help other shippers source enough beans to meet their own sales commitments.

The international companies are still able to export supplies acquired before the suspension, although the move may impact fresh sales depending on its duration. CCC earlier this week said it won’t allow exporters to build up stocks while others have yet to cover their contracts, after reports that some were at risk of default.

Spokespersons for Cargill and Barry Callebaut did not immediately reply to requests for comment. London cocoa futures recently climbed to a six-year high due to concerns over tight supply.

Kone said the CCC’s cocoa selling rules also prevent buyers from hoarding beans, imposing a penalty of 25 CFA francs (4 US cents) per kilogram for cocoa that stays in stock beyond a certain period of time. The CCC acknowledged a slowdown in bean arrivals at the ports, but said it was “too early to be alarmed” about defaults.

Source: NorvanReport