Ghana Cocoa Board seeks GH¢16.3 billion in domestic financing

The Ghana Cocoa Board (COCOBOD) is launching a GH¢16.3 billion ($1.4 billion) domestic financing plan to fund cocoa purchases for the upcoming season. This marks a significant shift from the decades-old practice of relying on foreign syndicated loans, a model that became increasingly difficult to maintain due to rising costs and operational challenges such as falling production and smuggling.

The issuance will be managed through a dual-tranche structure via a special purpose vehicle, Cocoa Capital PLC. The plan includes GH¢14 billion in short-term commercial paper with tenors of up to 270 days to finance seasonal purchases, and a GH¢2.3 billion five-year bond intended to refinance existing short-term debts.

This move follows the collapse of previous international financing arrangements and pre-financing deals with trading houses. The Chamber of Cocoa Marketers has expressed concerns regarding whether sufficient funding will be available once the season opens, noting that buyers are still owed approximately GH¢4 billion from the previous season. Debt repayments for the new issuance are expected to be backed by assigned cocoa export receivables from selected forward sales contracts.