(Adds details and trader reaction)
By Ange Aboa
ABIDJAN Aug 30 Ivory Coast cocoa exporters have
rejected a price structure proposed by the industry regulator
for the 2013/14 season, saying it underestimated their costs,
and have called for government mediation, industry sources said.
The standoff highlights disagreements that have plagued the
sweeping reforms that the government has put in place in an
effort by President Alassane Ouattara to guarantee farmers a
minimum price for their crop.
The main cocoa exporters, including Cargill, ADM
, OLAM and Armajaro, have called for an
increase of 27 CFA francs per kilo in the price structure from
last year to take into account additional costs, notably in
transport and taxation.
"We are asking for a 27 CFA franc increase in next season's
cost structure because it was underestimated so much last year,"
the head of one international cocoa exporter based in Abidjan
said on Friday. "We are asking for costs to be adjusted to the
reality on the ground for the 2013/2014 season."
The Coffee and Cocoa Council (CCC) set a farmgate price of
725 CFA francs ($1.46) per kg for the October 2012 to March 2013
main crop and a price of 700 CFA francs/kg for the
April-to-September 2013 mid-crop beans. It has not yet unveiled
the farmgate prices for 2013/2014.
Ivory Coast uses an estimate of the costs for exporters to
set a farmgate price for growers, based on the international
market price. It is therefore a major factor in determining
exporters' profits, at a time when many companies say they are
being squeezed by the government reform.
Farmers and buyers have said that some merchants in Ivory
Coast were buying below the CCC prices towards the tail-end of
this season due to weaker demand. Some farmers were accepting
offers between 500 CFA and 600 CFA.
Traders said buyers who adhered to the set price were
feeling the pinch.
"Most people are worse off except for the farmer. Most
people who operate have to bear a lot of risk but less reward,"
a European trader said.
($1 = 497.4650 CFA francs)
(Additional reporting by Sarah McFarlane in London; Writing by
Daniel Flynn and David Lewis; editing by Jane Baird)