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Top cocoa grower poised for record crop as desert winds loom
IT'S crunch time for cocoa output in top producer Ivory Coast.
The main crop - the larger of two annual harvests that started in October - is in full swing and bean deliveries suggest the country is headed for a record season.
The two biggest risks to a bumper harvest may still be on the way though: the Harmattan - dusty winds from the Sahara that blow from December to February - and an El Nino weather event that typically brings dryness to West Africa.
The Harmattan has started later than usual and cocoa trees haven't been affected by the increasing dryness, according to farmers from across Ivory Coast. One grower in Daloa, in the centre-west, said soil moisture remains good and the leaves and cocoa pods are still green.
The harvest has been better than last year thanks to favourable weather, said a farmer in Azaguie, in the south. The data backs that up: growers in Ivory Coast sent 676,509 tonnes of cocoa to ports this season through Dec 2, about 35 per cent more than the same time last year, according to weekly data reported by Bloomberg.
In neighboring Ghana, the second-largest cocoa producer, "farmers are upbeat about this season", said Michael Acheampong, a grower in Kwarbeng, north of the capital, Accra. "We believe we can exceed last season's cocoa output."
An El Nino formation tends to have a direct influence on the Harmattan in terms of intensity, said Giacomo Masato, a meteorologist at Marex Spectron. The weather this year is "nothing compared to the events that we had in 2015-16, which was one of the most aggressive Harmattan seasons recorded", he said. The Harmattan that year decimated the crop and helped push cocoa to a six-year high.
The Harmattan is off to a slow start this year and the predicted El Nino formation is also looking weaker, said Drew Lerner, president of World Weather Inc. It's unlikely that the desert winds will be significant until January or February, at which point there's potential for more persistent winds, especially if the El Nino develops more strongly, he said.
For now though, "it's trying to get its act together but it's having a tough time being a traditional event", he said.
The main crop in Ivory Coast, which runs until March and represents the bulk of yearly production, will probably be between 1.6 million and 1.7 million tonnes this year, according to three traders surveyed by Bloomberg. That would set the country on track for a record in the annual season.
"We are having a good year, a record probably," said Jonathan Parkman, an analyst at Marex Spectron. "Certainly in Ivory Coast it is going to be a record." BLOOMBERG