The International Finance Corporation, with support from the Bank of Ghana and the Ministry of Finance, has provided over 100 million United States dollars to stabilize Ghana’s cocoa supply chain, with total support potentially reaching 300 million dollars this year as financing delays at Ghana Cocoa Board create liquidity stress for licensed buying companies.
The funding was revealed by International Finance Corporation (IFC) Senior Country Manager Kyle Kelhofer on Channel One TV’s The Point of View programme, where he discussed the pressures facing the sector and the steps being taken to support it. Ghana, the world’s second largest cocoa producer, relies on a tightly linked financing system to move beans from farm gates to export markets.
Delays in expected COCOBOD funding have put pressure on Licensed Buying Companies (LBCs), forcing them to self finance operations and creating the risk of market disruptions. The financing gap has persisted over the last 18 months, according to Kelhofer, requiring LBCs to shoulder costs traditionally covered through the coordinated financing system managed by COCOBOD.
To bridge this gap, the IFC has worked closely with local banks, regulators, the central bank, and the Ministry of Finance, channeling funding in local currency to ensure LBCs can continue operations without interruption. The coordination highlights the critical role of international development finance in supporting Ghana’s cocoa industry as it faces funding and operational challenges.
“We’ve tried to step in, including with some support from the regulators, the central bank and the Ministry of Finance,” Kelhofer said, highlighting the close collaboration with authorities to sustain the cocoa supply chain. He emphasized that the intervention aims to prevent disruptions that could cascade through the sector and affect hundreds of thousands of farmers.
“And so we’re proud to have provided over $100 million and maybe up to $300 million this year to help ensure that the whole cocoa supply chain remains viable and that farmers at the farm gate are seeing all the LBCs and getting as price competitive and the best return possible,” he added.
With this coordinated support, LBCs can at least have some stability and breathing room to operate, while farmers can be confident that their beans will be purchased at fair and competitive prices at the farm gate. The funding offers a lifeline to a sector critical to Ghana’s economy and to the livelihoods of hundreds of thousands of cocoa farmers.
The IFC intervention represents a significant expansion of the institution’s engagement in Ghana’s cocoa sector. In June 2025, IFC announced a partnership with Société Générale Ghana providing 40 million dollars to increase access to finance, support sustainable production, and improve market access for tens of thousands of smallholder farmers.
That partnership focused on helping farmers adopt climate smart practices including agroforestry, improved cocoa varieties, and sustainable land management techniques. The facility also aimed to enhance traceability systems ensuring cocoa beans can be tracked from farm to export, meeting international sustainability standards and European Union Deforestation Regulation (EUDR) requirements.
The EUDR, which took effect December 31, 2025, requires proof that commodities including cocoa were not produced on land deforested after December 31, 2020. Ghana has responded by implementing the Ghana Cocoa Traceability System, which traces cocoa from individual plots to ports of shipment, ensuring compliance with EU due diligence requirements.
Société Générale Ghana’s partnership with IFC supports financing for LBCs and cocoa exporters while promoting sustainable and traceable cocoa production aligned with international market demands. The bank committed to expanding lending to the cocoa sector while incorporating environmental and social standards into credit assessments.
IFC also provided 230 million dollars to agricultural commodities trader ECOM Agro Industrial in February 2025 to support cocoa trading operations in Côte d’Ivoire and Ghana. The financing aimed to stabilize supply chains and encourage sector players to strengthen balance sheets, stabilize purchasing volumes from small producers, and intensify investments in sustainable supply chains.
ECOM operates through subsidiaries including Agroecom and Unicom Commodities in Ghana, buying cocoa directly from producers before transporting it to export ports under COCOBOD supervision. The company purchased nearly 150,000 tonnes of beans during the 2023/2024 campaign, with 68 percent sourced from communities benefiting from support programs.
COCOBOD traditionally raises between 1.5 and 2 billion dollars annually through syndicated loans to finance the cocoa season, paying LBCs for beans purchased from farmers. Delays in securing this financing in recent seasons have forced LBCs to use their own capital or seek alternative funding sources to maintain purchases during critical harvest periods.
Ghana’s cocoa production declined to approximately 336,000 metric tonnes in the 2024/2025 season from previous years’ levels exceeding 600,000 tonnes. Weather challenges, aging tree stock, disease pressures, and illegal mining activities damaging cocoa farmland have contributed to production declines despite government interventions.
For the 2025/2026 season, COCOBOD projects recovery to 650,000 metric tonnes based on improved weather conditions, distribution of free inputs including fertilizers and insecticides, and rehabilitation programs replacing old trees with high yielding varieties. The projection represents conservative estimates aimed at rebuilding credibility after previous forecasts proved overly optimistic.
The cocoa sector employs approximately 800,000 farm families across 10 of Ghana’s 16 administrative regions and generates about 2 billion dollars in foreign exchange annually. The industry represents a major contributor to government revenues and Gross Domestic Product (GDP), making its stability essential for macroeconomic health.
LBCs serve as intermediaries between farmers and COCOBOD, purchasing beans at government set producer prices and delivering them to warehouses for quality checks before export. The system ensures farmers receive guaranteed prices regardless of global market fluctuations while maintaining quality standards that preserve Ghana’s premium reputation.
When COCOBOD financing delays occur, LBCs face difficult choices between reducing purchases, seeking expensive commercial credit, or using working capital intended for other purposes. Any disruption in LBC purchasing capacity directly affects farmers who depend on timely payment for beans delivered during harvest periods.
The IFC funding channeled through local banks provides LBCs with cedis denominated credit at terms more favorable than purely commercial alternatives. By working through Ghana’s banking system rather than direct lending, IFC leverages existing relationships between banks and LBCs while supporting local financial sector development.
Kelhofer’s comments on The Point of View suggest the 300 million dollar figure represents a ceiling rather than committed funding, with actual disbursement dependent on continued financing gaps at COCOBOD and demand from LBCs. The flexible structure allows IFC to scale support based on evolving sector needs throughout 2026.
Beyond financing, IFC provides advisory services helping LBCs improve operational efficiency, strengthen governance structures, and adopt sustainability practices required by international buyers. Technical assistance complements financial support, building capacity for long term competitiveness beyond immediate liquidity relief.
The intervention occurs as global cocoa prices have declined from historic highs exceeding 12,000 dollars per tonne in February 2024 to around 5,100 dollars currently. While lower prices reduce revenue pressure, they also diminish margins available to cover financing costs when COCOBOD delays occur.
Ghana announced producer prices at 5,040 dollars per tonne for the 2025/2026 season, representing 70 percent of the Free On Board (FOB) value at the time of announcement. With global prices now trading below that level, COCOBOD faces financial stress absorbing the difference between what it pays farmers and international market values.
The financing gap affecting LBCs partially stems from COCOBOD’s own liquidity challenges as the board struggles to secure traditional syndicated loans amid concerns about Ghana’s debt sustainability and cocoa sector performance. International lenders have become more cautious about exposure to COCOBOD given production volatility and debt restructuring discussions.
IFC’s intervention demonstrates how multilateral development institutions can fill gaps when commercial financing proves insufficient or unavailable. As a World Bank Group member, IFC specializes in private sector development in emerging markets and committed a record 71.7 billion dollars globally in fiscal year 2025.
The institution’s mandate focuses on creating opportunities and markets in developing countries through capital deployment, expertise, and influence leveraging private sector solutions. Ghana represents a priority market where IFC maintains active engagement across multiple sectors including agriculture, manufacturing, infrastructure, and financial services.
Looking ahead, sustainable resolution of LBC financing challenges requires COCOBOD to restore regular access to syndicated loan markets or develop alternative funding mechanisms. The IFC support provides temporary relief but cannot indefinitely substitute for properly functioning sector finance architecture.
Parliament’s anticipated amendments to the Ghana Cocoa Board Act aim to refocus COCOBOD on core mandates and improve financial discipline, potentially enhancing creditworthiness and restoring lender confidence. Successful implementation could reduce dependence on emergency financing arrangements like the IFC intervention.
For now, the 100 million dollars already deployed and potential scaling to 300 million dollars this year ensures LBCs maintain purchasing capacity during critical harvest months. Farmers can deliver beans knowing LBCs have liquidity to pay promptly, preserving incentives for quality production and preventing distress sales at below official prices.
The coordinated approach involving IFC, Bank of Ghana, Ministry of Finance, and local banks demonstrates the multi stakeholder cooperation necessary to sustain complex commodity value chains during stress periods. Maintaining this coordination while addressing root causes of financing gaps remains the challenge facing Ghana’s cocoa sector.
