(Adds quotes from AIPC director, details on imports)
SAO PAULO, Aug 17 (Reuters) - Drought has damaged Brazilian cacao farms and will force the domestic processing industry to import seven times the volume of chocolate’s main ingredient in 2016 than it did last year, the AIPC industry association said on Wednesday.
Brazil will import 80,000 tonnes of the commodity in 2016, up from 11,000 tonnes in 2015, AIPC said, adding it was pushing the government to lift the ban on Ivory Coast cacao imports.
Eduardo Bastos, executive director of the AIPC, said tight supplies were increasing the industry’s costs.
“For us (importing) is horrible because it’s always better to secure supplies from the internal market,” he said. “To import, we have to make purchases six months in advance.”
The cacao industry in Brazil has already imported 50,000 tonnes of the commodity so far in 2016, Bastos said.
Brazil is expected to harvest 150,000 tonnes of cacao beans this 2016/2017 season, a drop of 30 percent from the season before, the AIPC said.
The drought over the cacao belt in Brazil’s main producer state of Bahia was so severe that some farms had suffered losses in the number of trees, which Bastos said would have a long-term impact on Brazil’s output potential given that it can take years for trees to become productive after planting.
“Future imports will depend (in coming years) on the next crops but we expect to reduce imports at least by half of this season next year,” Bastos said.
Brazil’s AIPC includes food processors such as Asian commodities trader Olam, U.S. merchant Cargill and Swiss chocolate maker Barry Callebaut.
The AIPC has been pressuring the government to lift its ban on cacao imports from Ivory Coast, the world’s largest producer. At present, Brazil only imports beans from Ghana.
“Since people know that Brazil is importing from Ghana, the price is very high,” Bastos said.
After the drought in Bahia slashed production there, prices for the cacao shot up quickly and are quoted at a premium of $268/t over July futures contracts in New York, compared with a discount of $623/t for the same month in 2015.
Bastos expects imports from Ivory Coast will be cleared by the end of the year.
The spike in imports come at a more difficult time for Brazil, which is suffering its worst recession in eight decades. Consumption of cacao has fallen 8 percent annually to 220,000 tonnes.
But the industry is expected to export 69,000 tonnes of cacao derivatives such as cacao butter and powder annually. (Reporting by Roberto Samora; Writing by Reese Ewing; Editing by W Simon and Chizu Nomiyama)
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