Ghana’s Cocoa Board (Cocobod) signed a $1.5 billion syndicated loan on Wednesday, as part of an annual pre-export preparation to finance cocoa purchases and operations costs for the upcoming 2021/22 season.
A consortium of twenty-eight local and international banks were party to the loan, including Standard Chartered, Mitsubishi UFJ Financial Group and the Industrial and Commercial Bank of China, Cocobod CEO Joseph Boahen Aidoo said at the signing ceremony on Wednesday.
The loan will be repayable in seven instalments between February and August 2022, and will be priced at 110 basis points over Libor, he said.
“Cocoa purchases at the end of the 2020 to 2021 cropping year stood at 1.045 million metric tonnes, breaking our 10-year record,” Aidoo said. “We need to commend ourselves for the realization of this milestone, and challenge ourselves to do even better in the coming year.”
Last year’s loan, for a lower amount of $1.3 billion during the pandemic, was raised by a club of 28 banks.
Cocobod, a statutory public board that supervises Ghana’s cocoa industry, usually raises funds in excess of $1 billion each year, underwritten by four to six banks before being syndicated to a wider bank group.
Ghana is the world’s second-largest producer of cocoa, the main ingredient in making chocolate, behind its neighbour Ivory Coast. The two West African nations together grow more than 60% of the world’s cocoa.
Analysts said on Wednesday Ghana’s cocoa production is expected to decline in the upcoming season, which begins in October, largely due to unfavourable weather conditions that caused the African crop to begin late.