Cameroon has raised the fixed farmgate price it pays to cocoa farmers to 1,500 CFA francs ($2.47) per kilogram for the 2023/2024 season from 1,200 CFA francs last season, Trade Minister Luc Magloire Mbarga Atangana said on Thursday.

The price is the highest since 2015, the minister said at the launch of the 2023/24 season, adding that it was increased due to a global production shortfall.

London cocoa futures on ICE steadied on Thursday, having hit a 46-year peak above £3,000 per metric ton the previous session.

Cocoa remains supported by concerns the market is heading into a third straight deficit in the 2023/24 (October to September) season, with weather signals from key producing region West Africa still worrisome.

Cameroon, the world’s fourth cocoa producer, aims to double its current annual production to 600,000 tonnes of high-quality cocoa beans per season and transform at least 40% of that volume locally, Atangana said.

Domestic traded cocoa volumes fell 11.2% to 262,112 tonnes during the 2022/23 season compared to the previous season, in Cameroon, data from the National Cocoa and Coffee Board (NCCB) showed on Thursday.

Atangana blamed bean smuggling to neighbouring Nigeria as buyers were wary of travelling to Cameroon’s cocoa-producing South West region, where a long-standing conflict is ongoing, due to security concerns.

He noted that global cocoa shortages, which have been attributed to adverse weather across West Africa, would benefit farmers as market prices increased.

But several farmers contacted on Thursday in the southwestern commune of Ngomedzap said that delayed rainfall and too much sunshine was having a negative impact on cocoa crops.

“The cocoa trees are in very bad shape and this affects output. Pesticides are also very expensive,” said Meyong Meyong Alphonse.

Cameroon is seeking to make cocoa its main export crop and boost local transformation capacity.

At the launch, Agriculture Minister Gabriel Mbairobe said challenges facing farmers included the impacts of climate change, certification requirements and land access.

($1 = 608.0000 CFA francs)

Source: Reuters