"Cocoa crisis deepens with Ghana set to lose access to bank loan"

" Cocoa crisis deepens with Ghana set to lose access to bank loan \r\n\r\nGhana is set to lose access to a key funding facility as a crisis in its cocoa crop has left it without enough beans to secure the funds.\r\n\r\nIt\u2019s the latest sign of the fallout from the extreme weather and disease that\u2019s hit cocoa output in both Ghana and neighboring Ivory Coast, the biggest grower. Cocoa futures in New York have more than doubled to record levels above $9,000 a ton this year.\r\n\r\nNow the country is turning to traders to try to plug the funding gap, according to Bank of Ghana Governor Ernest Addison. The Ghana Cocoa Board, the industry regulator known as Cocobod, relies on foreign financing to pay cocoa farmers for their beans.\r\n\r\n\u201cThe second tranche of the cocoa loan is being put together by a consortium of cocoa buyers,\u201d Addison told reporters in Accra on Monday.\r\n\r\nGhana, the world\u2019s No. 2 cocoa producer, secured an $800 million loan at the end of last year from a group of eight banks, led by Cooperatieve Rabobank UA. Cocobod, doesn\u2019t have enough beans to support the second and final $200 million drawdown from the commodity-backed facility, according to people familiar with the matter, who asked not to be identified as the matter is private.\r\n\r\nIt\u2019s not \u201cprudent\u201d to go for the additional drawdown, said Fiifi Boafo, a spokesman at Cocobod. \u201cManagement has decided to avoid an overstretch in the repayment,\u201d he said.\r\n\r\nGhana\u2019s funding challenges come as the cocoa harvest for 2023\/24 looks set to total about 422,500 to 425,000 tons, half the country\u2019s initial forecast, according to sources familiar with the matter. Without Cocobod payments, farmers won\u2019t be able to afford the seedlings, chemicals and fertilizers that are essential to a healthy crop.\r\n\r\nCocobod, which has previously obtained loans from investors at better rates than the government, would normally conduct an investor roadshow between June and July each year and sign the syndicated facility in September before the new harvest begins in October. Last year, the talks were complicated by the West African nation\u2019s debt restructuring.\r\n\r\nAs a consequence, it only signed a loan agreement in December and at a record high interest rate of 8%. It was originally scheduled to access the final tranche in January.\r\n\r\nStandard Chartered Plc and Societe Generale SA were among the other banks participating in the syndicated loan."

"Cocoa crisis deepens with Ghana set to lose access to bank loan"

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