Cocoa farmers in Ghana say prolonged payment delays are threatening to derail a strong mid-crop harvest, raising fresh concerns over supply from the world’s second-largest cocoa producer.
Farmers and industry players told Reuters that payments for beans delivered to Licensed Buying Companies (LBCs) have been delayed by up to six months, leaving growers without the cash needed to hire labour and transport crops during a critical harvesting window.
The cocoa sector underpins the livelihoods of around 800,000 farming families in Ghana, making the delays a major economic concern in rural communities.
“I have cocoa on the trees that needs to be harvested but there is no money to even do that,” said Theophilus Tamakloe, vice president of the Ghana Cocoa Cooperatives Association, which represents more than 340,000 farmers.
Tamakloe said he has nearly a metric ton of cocoa beans stored in his warehouse but has refused to sell on credit, insisting on immediate payment amid growing uncertainty.
“I will only release them to an LBC that pays me instantly,” he said, highlighting the cash flow crunch affecting farmers and buyers alike. Ghana currently has about 65 licensed buying companies operating in the sector.
Other farmers echoed similar concerns, warning that despite improved yields driven by favorable rainfall, the inability to access funds could leave significant quantities of cocoa unharvested.
Farmer Abdulai Adoswin said he had harvested 300 bags so far this season, compared with 190 bags at the same point last year, but cautioned that further gains would depend on timely payments before the season ends in August or September.
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Ghana’s cocoa regulator, Ghana Cocoa Board, said it has been disbursing funds to LBCs to clear arrears dating back to November. However, industry sources say payments remain outstanding.
Two LBC officials, speaking on condition of anonymity, said they had yet to receive funds for cocoa already supplied and sold, pointing to deeper liquidity constraints within the system.
“My understanding is that COCOBOD has sold all the beans supplied for the 2025/26 season,” one source said. “We are still waiting to be paid and I really don’t know what is going on anymore.”
COCOBOD did not immediately respond to requests for clarification on the status of payments, saying it would investigate the matter.
The delays come against the backdrop of a broader financial strain in Ghana’s cocoa sector, where a liquidity crunch has persisted for months. The situation has forced authorities to cut the fixed producer price paid to farmers, further squeezing incomes.
At the same time, Ghana has faced declining cocoa output in recent years due to a combination of factors, including crop disease, ageing plantations, illegal mining activities and increasingly erratic weather patterns.
Official data from the Bank of Ghana shows cocoa export revenues fell by around 20% year-on-year to 956.3 million cedis ($86 million) in February, underscoring the sector’s ongoing challenges.
Although improved mid-crop yields had raised hopes of a partial recovery, global cocoa prices have dropped sharply — by nearly 75% from record highs in late 2024 — reducing the financial cushion for both farmers and exporters.
Analysts warn that if payment bottlenecks persist, Ghana risks losing part of its harvest despite favorable growing conditions, potentially tightening global cocoa supplies later in the year.
“The paradox is that there is cocoa available, but the system is struggling to move it from farms to market,” said one industry analyst.
For now, farmers say resolving the payment delays is critical to salvaging the remainder of the season and sustaining production in the months ahead, as confidence in the sector hangs in the balance.
