Cocoa grinders in Ivory Coast, Ghana hit hard by poor bean quality

ABIDJAN/ACCRA (Reuters) - Cocoa grinders in Ivory Coast and Ghana, the world’s top two bean producers, have slashed output or suspended operations due to a lack of beans fit for processing, company officials said on Tuesday, heightening to the risk of a supply deficit.

Port arrivals in leading grower Ivory Coast are lagging behind last year due to poor weather, while Ghana is set for only a modest recovery from last season’s failed crop.

Ivory Coast is currently harvesting its mid-crop, which runs from April to September. Ghana has yet to fix a period for marketing its light crop this season and is expected to offer grinders discount on light crop beans, determined by their size.

Grinders buy the bulk of mid crop and light crop beans, which are smaller than main crop cocoa, but this season they have been in short supply.

“Everyone is reducing grinding capacity to be able to keep working, because it costs more to close and reopen than to reduce output,” said the head of one processor in Ivory Coast, which is the world’s biggest grinder.

Bean size is determined by the number of beans per 100 grams of cocoa, known as the bean count, with a higher figure reflecting smaller bean size.

Smaller beans contain less cocoa butter, the ingredient that gives chocolate its texture.

“The bean count is high. We’re seeing 140, 150 or even 160,” said Ali Lakiss, Chief Executive Officer of Choco-Ivoire, a grinder based in Ivory Coast’s second port city San Pedro. “We’ve stopped grinding, because we don’t have enough beans.”

Other Ivorian processors said they would keep operating but reduce output sharply. However two of them said they would probably have to shut down if the beans did not improve in July and August.

Ivory Coast’s 12 local grinders have installed processing capacity of 720,000 tonnes annually. Swiss firm Barry Callebaut, Singapore’s Olam International, U.S.-based Cargill [CARG.UL] and France’s Cemoi are the largest.

Neighboring Ghana has a much smaller grinding sector, processing less than 30 percent of its total cocoa output.

The government and cocoa regulator Cocobod want to increase capacity and process half the crop domestically. However, its grinders are also facing difficulties this year.

“We run our factory based on availability of beans and recently, we have had to cut output, sometimes drastically, based on the stocks available,” said one company official.

Grinders currently operating in Ghana include U.S-based Cargill, Olam and France’s Touton, Barry Callebaut and domestically owned Cocoa Processing Company.

One processor told Reuters bean stocks were so far allowing his company to weather a shortage of discounted light crop beans, considered to be cocoa with a count exceeding 120 beans per 100 g, but that was only a short-term solution.

“They are not receiving much from us because the beans are not available,” said one Cocobod official. “Alternatively, they buy the main crop beans but it’s expensive. Unfortunately, it’s going to be worse for them.”

Last season, many Ghana-based grinders imported beans from Ivory Coast to keep factories running. But that’s unlikely to be an option this year.

“There’s a problem of beans over there again, but there’s nothing we can do this time,” said an Abidjan-based grinder. “To be honest it’s not worth it. It’s better to grind in Ivory Coast. Electricity and beans are the problem in Ghana.”

Writing by Joe Bavier; Editing by Ruth Pitchford