Although Ghana and Côte d’Ivoire jointly produce roughly 60 percent of the world’s cocoa, the two West African nations exercise almost no control over the ultimate market value of their biggest foreign exchange earner.
When international cocoa prices crashed in early 2026, both governments found themselves with few options, scrambling to keep beans moving out of ports, ensure farmers were paid, and convince reluctant international traders to remain in the market.
In Ghana, the government was forced to cut the domestic producer price by nearly 29 percent in February, dropping it from GH¢58,000 to GH¢41,392 per tonne, after international prices fell from about $7,200 to roughly $4,100 per tonne. Across the border in Côte d’Ivoire, where the state opted to hold its price fixed, international traders simply refused to buy, leaving an estimated 200,000 tonnes of cocoa sitting unsold in warehouses as the March season wrapped up, according to reporting by Reuters.
The disruption exposed the limits of the two countries’ existing pricing systems and has prompted them to coordinate more closely.
That change in strategy was highlighted in June when Presidents John Dramani Mahama of Ghana and Alassane Ouattara of Côte d’Ivoire signed a joint declaration agreeing to coordinate their pricing policies, align their marketing calendars, and process a significantly larger share of their own beans prior to export.
The measures could give the two countries more room to coordinate how they market their crop. But their ability to influence the international price remains tied to what happens beyond their borders—including supply from other producing countries, demand from chocolate manufacturers, warehouse stocks, and futures trading in London and New York.
A commodity priced far from the farm
Because cocoa does not have a single, unified price, the global benchmark is determined on futures markets—primarily in London and New York—where traders place financial bets based on the weather, global factory demand, warehouse stocks, and currency fluctuations.
The price a West African farmer receives operates under a completely different system, such as in Ghana, where a state committee sets the farmgate price based on projected export earnings and exchange rates while guaranteeing farmers at least 70 percent of the gross export value.
But in February 2026, the gap between the global financial market and Ghana’s local mandated price became too difficult to sustain without state intervention. Addressing the mounting crisis, Ghana’s Finance Minister, Cassiel Ato Forson, explained that the country’s cocoa had become globally uncompetitive because the world price had fallen below the basic logistical cost of moving Ghanaian beans from farms in rural areas to coastal ports.
“The current situation is largely driven by the unwillingness of buyers to purchase Ghana’s cocoa because it has become uncompetitive and very expensive,” the minister had said.
The problem was not simply the price paid to farmers. Ghana also faced a shortage of liquidity among local buyers.
The state-owned Produce Buying Company — designed to act as the buyer of last resort — could not step in because it was already weighed down by 673 million cedis in debt, including money owed directly to farmers.
With limited cash available, local buyers struggled to purchase beans even when cocoa was physically available. That created a different form of unsold cocoa from the situation in Côte d’Ivoire: Ghana’s difficulty was linked not only to the relationship between the farmgate price and international prices, but also to the ability of the domestic purchasing system to finance purchases and move beans through the supply chain.
Côte d’Ivoire faced a mirror image of the same problem after the government locked in a main-crop farmgate price of 2,800 CFA francs per kilogramme for the 2025/26 season. When global prices sank beneath that level, exporting companies faced losses if they bought beans at the government rate to sell on the international market, causing domestic purchasing to freeze.
To clear the resulting backlog, Agriculture Minister Kobenan Kouassi Adjoumani announced in January that the government would comprehensively inventory the unsold cocoa and use state funds to purchase the stranded stocks at the guaranteed price. Local farming groups welcomed the bailout, with Obed Blondé Doua, vice-president of the country’s Coffee-Cocoa Interprofessional Organisation, telling local media that “L’État a pris les choses en main” (the state has taken matters into its own hands), yet the massive public spending required to clear the market proved that state protection comes at an unsustainably high cost.
Why cocoa prices collapsed
The severe market crash of 2026 followed an unusual rally throughout 2024, when poor harvests, widespread tree diseases, and adverse weather in West Africa squeezed global supplies, pushing cocoa futures to record highs and prompting manufacturers to raise retail prices while experimenting with alternative ingredients.
Then the market balance flipped as global production recovered, rising 8.3 percent to 4.72 million tonnes for the 2024/25 season according to the International Cocoa Organization (ICCO), while industrial demand—measured by factory grindings—fell by 3.8 percent. This combination of a 37,000-tonne global surplus and rising warehouse stocks proved disastrous for prices, with Reuters reporting that cocoa futures fell by roughly 50% during the first weeks of the year as factories pulled back their orders.
The ensuing crash disrupted the local supply chain in Ghana, where the state-owned Produce Buying Company—designed to act as the buyer of last resort—could not intervene because it was already weighed down by 673 million cedis in debt, including money owed directly to farmers. With limited liquidity among local buyers, cocoa could remain at the farm or in local warehouses even when there was a crop available for purchase.
Yet the market remains highly volatile. This is evidenced by a significant price recovery by September, which was driven by new weather warnings and a forecast from Ghana’s COCOBOD predicting a 16 percent drop in production for the 2026/27 season. This is due to aging farms, excessive rainfall, and the lingering effects of El Niño. This rapid swing proves that prices can move drastically in either direction based on global sentiment, completely independently of what West African governments desire for their economies.
Closing the borders to smuggling
Rather than an attempt to form a global pricing cartel, the June declaration is primarily a regulatory measure designed to stop the two neighbouring countries from financially undermining each other.
Historically, Ghana and Côte d’Ivoire operated their cocoa sectors separately, meaning that if one country set its domestic cocoa price higher than the other, farmers and local smugglers would simply move their beans across the porous border to take the better offer on the other side. Ghana’s government explicitly noted this dynamic when Côte d’Ivoire raised its producer price in October 2025, creating an immediate financial incentive for Ghanaian cocoa to be illegally smuggled westward.
To close that lucrative loophole, both countries have now agreed to run their marketing seasons on the exact same schedule, with Côte d’Ivoire moving its opening day up to September 1 to match Ghana, while a joint task force established under the Côte d’Ivoire-Ghana Cocoa Initiative works to continuously align their farmgate prices.
However, despite these internal reforms, they still have to sell their crop into a competitive global market that can readily source from Ecuador, Brazil, Nigeria, and Cameroon, meaning they can change the rules for their own borders but cannot force the rest of the world to comply.
Moving beyond the bean
Because they cannot effectively control the global price of raw agricultural exports, both governments are shifting their long-term focus toward targeting the next, more lucrative step in the supply chain: industrial processing.
Currently, the vast majority of West Africa’s cocoa leaves the continent as raw beans, allowing the real profits of the industry to be captured by retail brands, which account for about 70 percent of chocolate’s total value according the Food and Agriculture Organization (FAO). By contrast, actors operating in cocoa-producing countries collectively account for just 18.6 percent of the final value, a structural imbalance that Côte d’Ivoire is actively trying to correct by pushing its local processing rate to 41 percent.
According to the FAO, Côte d’Ivoire aims to process 80 percent of its crop locally by 2030, a goal mirrored by Ghana, which announced in February a mandate to process at least 50 percent of its beans locally while pledging state funds to revive the state-owned Cocoa Processing Company.
The distinction between processing capacity, actual processing and government targets is important. Côte d’Ivoire has physical infrastructure capable of processing more than 1.1 million tonnes, according to government statistics, but processed about 650,000 tonnes last season. The 1.1 million-tonne figure therefore describes installed capacity, not the quantity processed.
Local processing would allow Ghana and Côte d’Ivoire to sell products such as cocoa butter and powder in addition to raw beans. It could also create demand for transport, energy and factory labour within the producing countries.
But processing itself does not eliminate exposure to the international market. Processors still depend on buyers for their products, while factories require financing, reliable supplies of beans, energy, and access to export markets.
The threat of alternatives
There is one final constraint on any attempt to keep cocoa high: when cocoa becomes too expensive, the multinational food industry can change the composition of its products.
During the extreme price spikes of 2024, food companies invested heavily in alternative vegetable fats and lab-grown substitutes, a shift described in a January research note from Rabobank as moving from niche experimentation to a calculated, strategic response to cocoa-price volatility.
However, this corporate shift is highly reactive to the market, as demonstrated when bean prices collapsed in early 2026 and manufacturers quietly reversed course, with Reuters reporting in May that Hershey planned to increase the real cocoa content in some of its products simply because conventional chocolate had become economical again.
This fluid dynamic leaves producers trapped in a difficult bind where driving prices too high means losing buyers permanently to synthetic alternatives, but allowing prices to fall pushes rural farmers further into poverty.
Their combined share of global production gives the two countries a significant position in the cocoa supply chain. But the evidence from 2026 shows that production share alone does not determine what happens to cocoa prices. Their influence also depends on how much of that production can be coordinated, financed, processed, and sold—and on how global supply and demand develop outside their control.
The unresolved question is how much those measures can change that balance. Coordinated pricing may reduce competition between neighbouring producers. Local processing may allow more value to be retained before cocoa is exported. But both countries will still be selling into a market shaped by international production, manufacturers, traders, consumers, and financial markets.
For Ghana and Côte d’Ivoire, they now have to wait and see whether those measures can translate their large share of cocoa production into greater influence over the terms on which the crop is bought and sold.
