February 17, 2011 / 5:56 PM / in 8 years

By canoe and bike, Ivorian cocoa seeps into Ghana

JEMA, Ghana (Reuters) - Canoes with dozens of bags of cocoa from Ivory Coast came floating upstream to the Ghanaian border town of Jema earlier this month for loading by smugglers onto trucks to supply the world’s markets.

Cocoa beans cover the ground in front of the EU delegation building during a protest by Ivorian cocoa growers in Abidjan February 17, 2011. REUTERS/Thierry Gouegnon.

Those smugglers were nabbed thanks to a tip-off, security officers involved in the February 7 seizure said. But Ghana fears its cocoa business could still get hit by a trade in contraband Ivorian output that has taken off since a disputed November 28 election plunged the world’s top grower into chaos.

“We have a limited number of officers and resources, I cannot say we are able to cover all these bush paths,” said customs officer David Yilinan Benyan of the task of monitoring a territory where farms and villages often straddle the border.

Ivorian incumbent Laurent Gbagbo — backed by the army — has refused to step down, arguing that UN-certified results giving his rival Alassane Ouattara victory were rigged.

In a bid to starve Gbagbo’s government of funding from a cocoa trade worth $1 billion in taxes a year, Ouattara has called on exporters to suspend business during the month of February and has left open the option of a longer embargo.

Separately, a European Union move to ban its ships from docking at the main Ivorian ports of Abidjan and San Pedro has meant that, even if the cocoa is getting from the bush to the ports, very little of it is making it onto boats.

With warehouse storage capacity filling up, Ivorian farmers are looking elsewhere to get their produce to market before it starts to rot — and many are looking to eastern neighbor and world number two grower Ghana.

According to local farmers and officials interviewed by Reuters during a four-day tour of border areas, many Ivorian farmers are selling their produce to Ghanaian merchants who carry it over the border on boats and the back of motorbikes through the many bush paths criss-crossing the porous border.

The extent of the illicit trade is disputed — and by its nature hard to pin down. While Ivorian regulators say they have lost 100,000 metric tons to smuggling in the season so far, Ghana’s Cocobod sector body says the impact is minimal.

The two neighbors between them supply around a half of the world’s beans and Ghana is vying to knock Ivory Coast off the top spot with an aggressive expansion program its ailing and crisis-hit rival can scarcely match.

It comes months after Ghana acted to snub out an illegal trade in the opposite direction by raising the official price paid for cocoa in its regulated sector — removing the temptation for its farmers to seek higher prices next door.

To maximize profits and avoid detection, Ivorian beans are secretly mixed with local produce and sold to buyers and distributors, security officials say — a development Ghana fears could dent its claim of superior-quality cocoa.

“With Ghana cocoa we dry it well. The Ivorian farmers do not dry it well so if it comes over it will not be good,” said Charles Sackitey, a farmer on the banks of the River Tanoso, near the suspected landing site of the February 7 haul. He said the river is often used as a conduit for cocoa trafficking.

In Oseikojokrom, a border town further north, cocoa merchant Moses Antwi said the quality difference was a cause for concern, as behind him beans were packed into Hessian sacks emblazoned with “GHANA COCOA BOARD, PRODUCE OF GHANA.”

“If they are smuggling from Cote de Ivoire to Ghana it will affect Ghana because the quality is not equal. If they take it into Ghana then we have a problem,” Antwi said.

Security agencies say they are doing their best to prevent the influx of Ivorian beans and have set up a joint taskforce between the police, customs, immigration and military.

Even before the crisis, licensed buyers were offering a third more for Ghanaian beans that what Ivorian beans could attract. With farmgate prices in Ivorian Coast having since halved to 350 CFA francs (72 US cents) per kilo, there is a clear profit to be had from contraband.

“I have seen them. They come through the small routes. We have a lot of small routes in this area so they come even in the daytime,” Abbas Mohamed said as he dried and packed beans on his father’s 118-acre farm near the tiny village of Amankwakram, an alleged hotspot for smuggling.

“We are the world’s leading producer of quality beans and their beans are no good compared to Ghana. People are rushing, going there and buying bad beans and bringing them here.”

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