I Coast smells the coffee

2004-10-10 19:52

Abidjan - Cocoa farmers in Ivory Coast, the world's biggest producer, have won a 4% increase in the price they will be paid for their crops next season, the Coffee and Cocoa Board said on Saturday.

The price paid to the country's 600 000 cocoa farmers will be set at 380 CFA (African Financial Community) francs (R4.62) a kilogramme, a rise of 15 CFA francs on the previous season.

The increase follows an acrimonious dispute beween the farmers and the distribution network, according to one source, who said it had been initially planned to set the price at 285 CFA francs.

Producers in Ivory Coast, the source of 40% of the world's cocoa, have been protesting in Abidjan and elsewhere about the way the distribution network operates, complaining that the state and middlemen are making excessive profits through the tax system.

Cocoa and coffee bring in 40% of Ivory Coast's revenues and represent €1.2bn, or 20% of its annual gross domestic product.

More than six million of the country's population of 16 million rely either directly or indirectly on the cocoa industry, irrespective of where they live in the country divided between north and south since a failed coup in September 2002 plunged Ivory Coast into war.

But the conflict has driven tens of thousands of growers from their farms.

Ivory Coast's cocoa sector was liberalised in 2000, turning regulation over to semi-private bodies instead of state-run agencies.

A minimum-pricing scheme was abandoned in favour of a sliding tariff scale, the profits from which are paid into a fund to compensate small-scale growers should there be heavy losses on the global markets.

Cocoa producers have called for the dissolution of the regulatory structures, saying they have not adequately fulfilled their roles in ensuring that growers will be compensated for financial loss due to falling world prices.

The 2003-2004 season ended with a slight increase in production, with exports rising by 35 000 tonnes to 1 340 000 tonnes by mid-September compared with 2003. Production next year is forecast to reach similar levels.

- AFP