By Nalova Akua
Jean Mari Konan Yao is a struggling cocoa farmer in N’Gattakro, a lowland district in the Iffou region of Cote D’Ivoire. Cocoa proceeds have provided a lifeline for Yao for years until only recently when adverse weather, plant disease and lack of input caused them to shrink.
“In 2023, I harvested six and a half bags of cocoa. But I only harvested two and a half bags during the last cocoa season,” Yao recalls with a feeling of nostalgia.
Now, farmer Yao and his peers fear for an even more uncertain future in their cocoa farming endeavor after the US announced it will slap 21% import duties on products from the world’s largest cocoa producer.
Although President Trump says that the tariffs would be suspended for 90 days pending further review, Côte d’Ivoire has warned that it may raise cocoa prices in retaliation if the steep new US tariffs are enforced. The West African nation produces between 2 million and 2.5 million metric tons of cocoa annually – around 200,000 to 300,000 metric tons of which are exported to the United States.
The Ivorian Agriculture Minister Kobenan Kouassi Adjoumani has called on the US to reconsider its stance, stating the cost of Ivorian cocoa could rise if the tariffs proceed. In a recent interview, Adjoumani hinted that the end consumer would be the greatest loser. “When you tax our product that we export to your country, we will increase the price of cocoa, and that will have a repercussion on the price to the consumer,” Reuters quotes Kouassi as saying.
For most cocoa growers in Ivory Coast, however, the US import duties could be the last straw in a struggling sector. “We are suffering,” says Berthin Assi Konan, a cocoa farmer in N’gattakro. “I pay people to do all the related work in the cocoa production chain [yet, I can’t break even]. Profits encourage us to work more cocoa for exports.”
Boss Diarra, coordinator of a cocoa farmers’ union in Bouaflé in Côte d’Ivoire’s Marahoue region, says Ivorian cocoa producers are “already feeling the effects” of US announced tariffs. “You see, this stockroom is full,” Diarra says.
“Donald Trump’s [import duties] are causing us problems. Because of this, people [won’t] buy our products [anymore].”
While Ivorian farmers feel apprehensive about the possible impact of the US tariffs on their earnings, economic analysts are concerned about the knock-on effects of the tariffs in the markets of other top cocoa producing nations like Cameroon and Ghana which have also been slapped with a 10% tariffs each.
Henri Kouam, Executive Director of the Cameroon Economic Policy Institute (CEPI), a research-based free market think tank, says lower demand and export volumes could decrease the revenue of cocoa farmers and exporting companies in Cameroon, Ghana and Côte d’Ivoire.
These countries could however accelerate domestic processing to add value to their exports and reduce their reliance on cocoa producers, he says. “The impact remains uncertain, but we could see some shifting to lower-tariffed jurisdictions like Ghana and Cameroon – boosting demand and farmer revenues,” Kouam tells NewsWatch.
He expresses concern that farmers will bear the highest brunt of the US tariffs. “The war in Ukraine already increased prices for fertilizers, putting a stain on farmers’ incomes. If export duties rise and fertilizer prices stay elevated, farmers could end up spending more,” according to Kouam. “Tariffs will disrupt supply, lower revenues and potentially slow development and inclusive development of the cocoa sector in Côte d’Ivoire.”
Anticipating a smaller harvest due to various factors like weather and disease, the Ivorian government raised the cocoa price on April 2 to 2,200 CFA francs a kilogram. But this still fell far below global prices of about $8,450 a ton.
Even with the price increase and reduced supply, farmers are finding it difficult to sell all their cocoa. Observers believe the price-setting system by governments in Ivory Coast and neighbouring Ghana has prevented farmers from fully benefiting from cocoa’s record-breaking rally that shaped the market over the past year.
Years of low pay have stifled investment in ageing plantations and encouraged smuggling to other nearby nations where the market isn’t as tightly regulated and prices are much higher.
Speaking after a ministers’ meeting in Abidjan on April 10, the Ivorian minister of communication, Amadou Coulibaly, said the country was weighing in on new potential markets for its cocoa “to be able to compensate for this loss.”
“We are affected because we have about 4% of our trade with the United States [which] mainly concerns cocoa, rubber, and a little cashew,” Coulibaly said.
Kouam of the Cameroon Economic Policy Institute says the announced tariffs will make Ivorian cocoa “significantly more expensive” for US importers, while Ivorian cocoa will become “less competitive” compared to cocoa from countries facing lower or no tariffs such as Ghana (10%) and Ecuador at (10%). This could force US buyers to replace Ivorian cocoa imports to the US annually, he says.
“We are likely to see a situation whereby Ivory Coast strengthens ties with the European Union and Asia to offset potential losses in the US market, especially as the EU is the main destination for Ivorian cocoa, and Asia, a growing market.”
Ivorian authorities, on the other hand, could raise export taxes on cocoa to compensate for lost revenue, which would further increase global cocoa prices and potentially impact other markets.
“Ivory coast tariffs on U.S. products range from 5% for essential commodities to 35% for processed goods,” Kouam points out.
“So, Ivory Coast is unlikely to raise tariffs on US imports in response, but it could start invoicing trade in non-dollar currencies like the Euros and Chinese Renminbi which will reduce the role of the dollar in global trade.” He however noted that fluctuating global cocoa prices are “volatile” and can decline due to oversupply changes in demand.
