REDEFINING COCOA FINANCING: A BOLD NEW ERA FOR GHANA’S COCOA’S INDUSTRY

COCOBOD introduced a new self-financing model to reduce dependence on syndicated loans, enhance farmer payments, and ensure sustainability. The publication highlights major sector reforms, technology upgrades, climate resilience measures, and initiatives aimed at improving farmer welfare. The self-financing structure combines forward and spot sales with pre-financing arrangements between Licensed Buying Companies (LBCs) and international buyers. Through this system, LBCs can raise funds via equity or bank loans under a 60:40 pre-financing arrangement, supported by Cocoa Takeover Receipts (CTORs) to ensure prompt farmer payments. This shift strengthens liquidity within the supply chain, eliminates borrowing delays, and enhances transparency. The model is part of broader reforms to modernize Ghana’s cocoa industry, promote sustainability, and improve economic returns for farmers.