The Acting CEO of the Ghana Cocoa Board (Cocobod), Dr. Randy Anerley Abbey, has raised the alarm over the survival of indigenous Licensed Buying Companies (LBCs), warning that they could collapse without urgent financial support. His concern follows Cocobod’s decision to forgo its traditional syndicated loan for the 2025/2026 cocoa season, creating a major funding gap for local cocoa buyers.
Speaking on PM Express Business Edition with George Wiafe on Joy News, Dr. Abbey explained:
“The indigenous LBCs are struggling because we are not securing a syndicated loan for 2025/26. This has denied them the seed money they rely on to purchase cocoa beans.”
Traditionally, Cocobod secures an annual syndicated loan from international banks to finance cocoa purchases, which includes disbursing seed funds to LBCs. Without this facility for the upcoming season, local buyers are facing a severe liquidity crisis.
“For the 2024/25 season, we already had reduced syndicated loan support—so no seed fund. While Cocobod saves on financing costs, the effect on smaller local LBCs is dire,” he said.
Dr. Abbey noted that the shift is financially motivated, as borrowing has become increasingly expensive. Syndicated loans of GH¢3–3.5 billion now attract high interest rates, with banks demanding between 8% and 10% on dollar-denominated loans.
“Cocobod is trying to cut costs, but this is coming at the expense of indigenous LBCs who cannot operate without seed capital.”
In response to the growing crisis, Cocobod has initiated talks with the Bank of Ghana, proposing a policy intervention involving the Cash Reserve Ratio (CRR)—the portion of commercial banks’ customer deposits held with the central bank.
“We’ve suggested that 2–3% of the current 25% reserve could be allocated to support indigenous LBCs. It’s idle money sitting at the central bank,” he explained.
Dr. Abbey proposed that any funds released should be ring-fenced strictly for cocoa purchases:
“We need to ensure the funds are used solely for cocoa, not diverted into unrelated ventures like oil or tinned tomatoes.”
He expressed hope that the central bank would respond positively to the proposal, describing it as a potential lifeline for struggling local cocoa firms.
“Without intervention, most indigenous LBCs could go extinct under the current financing model.”
This comes as Cocobod shifts to a new 60-40 financing arrangement with international buyers for the 2025/26 season, prompting Dr. Abbey to personally travel to Europe and North America to secure commitments from buyers.
