The Ghana Cocoa Board has disclosed that it is finalising a new funding model for the cocoa sector ahead of its implementation in the 2026/2027 crop season, as part of efforts to ensure price stability and sustainable incomes for cocoa farmers.
Chief Executive of COCOBOD, Dr Randy Abbey, disclosed this 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.
Dr Abbey said Ghana’s cocoa sector had, for more than three decades, relied on syndicated loans backed by forward cocoa sales to finance annual crop purchases.
According to him, although the arrangement had helped provide liquidity for cocoa purchases over the years, it also required a significant portion of Ghana’s cocoa output to be 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 said.
He explained that the new funding framework would introduce a revised pricing mechanism involving periodic reviews, potentially 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,” Dr Abbey stated.
He said the proposed model would mobilise capital through instruments such as commercial paper and commercial notes while leveraging domestic liquidity, including support from institutional investors.
The reform, he noted, would maintain the policy of paying cocoa farmers 70 per cent of the Free-On-Board (FOB) price, while allowing periodic price adjustments to reflect movements in global cocoa prices and exchange rates.
Dr Abbey said the objective was “to strike a careful balance between income stability for farmers and the financial sustainability of the cocoa sector.”
He added that the model would broaden participation in the cocoa economy, improve financing access for local processors and indigenous Ghanaian companies, and increase value retention within the country.
Dr Abbey expressed confidence in Ghana’s financial sector to support the transition, citing improving macroeconomic conditions and increasing investor interest in structured financial instruments.
He acknowledged concerns among stakeholders, particularly Licensed Buying Companies and investors, regarding the structure and scale of the proposed financing arrangements.
According to him, a detailed prospectus outlining participation opportunities was being finalised and would be fully explained before the start of the 2026/2027 crop season.
He said the reforms would better protect farmers from the effects of global cocoa price volatility.
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.
