COPAL COCOA Info. 530.doc · Web viewLook out, chocolate lovers: extortion in the world's No. 1...

INSIDE THIS ISSE: ICCO DAILY COCOA PRICES LONDON (LIFFE) FUTURES

MARKET UPDATE NEW YORK (ICE) FUTURES

MARKET UPDATE FROM THE NEWS MEDIA

COPAL COCOACOPAL COCOA InfoInfo A Weekly Newsletter of the Alliance of Cocoa Producing Countries

Health and Nutrition The benefits of Valentine's Day chocolate Attention chocoholics – a little chocolate is good

for you

Production and Quality Efforts to revamp cocoa growing Higher chocolate prices may follow Africa's Cocoa

shortfall

The Market Brazilian cocoa deliveries rise by a fifth Ivorian cocoa arrivals still running behind last

season Cocoa under Threat

Processing and Manufacturing Encourage cocoa processing, Investors urge

Labour Issues Ghana agric workers campaign against child

labour in cocoa growing areas

Environmental Issue Southern Cameroon gets most rain in cocoa belt Cocoa turns higher on weather concerns

Research & Development

Promotion & Consumption Germany cocoa in high global demand

Others

Do your health a favour, drink Cocoa everyday

‘It’s nature’s miracle food’UP-COMING EVENTSUP-COMING EVENTS IN THISIN THIS

Issue No. 530 4th – 8th February 2013

Government First Cameroon cocoa powder ADM Cocoa unveils increased processing capacity

in Singapore Cargill won't reduce cocoa operations

Business & Economy Cadbury Nigeria seeks 100% ownership of

Stanmark Cocoa Division

In the News (from Newspapers worldwide)

ICCO Daily Cocoa PricesICCO Daily Price

(SDR/tonne)ICCO Daily Price

($US/tonne)London futures

(£/tonne)New York futures

($US/tonne)

4th February 1448.72 2228.67 1435.00 2201.67

5th February 1477.97 2273.03 1469.33 2249.67

6th February 1468.79 2255.05 1459.00 2228.00

7th February 1475.59 2268.08 1462.67 2243.00

8th February 1472.53 2257.42 1448.67 2226.67

Average 1469.00 2257.00 1455.00 2230.00

COCOA PRODUCERS’ ALLIANCE, NATIONAL ASSEMBLY COMPLEX TAFAWA BALEWA SQUARE, P.O. BOX 1718, LAGOS, NIGERIA. TEL: +234(0)1-263-5574 FAX: +234(0)1-263-5684

Email: [email protected] Website: www.copal-cpa.org2

mailto:[email protected]

International Financial Futures and Options Exchange (LIFFE)London Futures Market – Summary of Trading Activities

(£ per tone)

Monday 4th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 1438 1427 -8 1442 1424 4,543May 2013 1452 1434 -10 1452 1430 2,930Jul 2013 1458 1444 -9 1458 1441S 1,065

Sep 2013 1466 1452 -10 1468S 1450S 477Dec 2013 1467 1455 -8 1467S 1452S 235Mar 2014 1460 1450 -5 1461S 1447 249May 2014 1457 1455 -5 1459 1457S 13Jul 2014 1469 1458 -5 1469S 1457 17

Sep 2014 1463 -6 0Dec 2014 1473 -5 0

Average/Totals 1451 9,529

Tuesday 5th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 1431 1464 37 1465S 1424 8,124May 2013 1435 1468 34 1470S 1430 6,638Jul 2013 1444 1476 32 1479S 1440 2,305

Sep 2013 1450 1485 33 1486S 1449S 1,978Dec 2013 1456 1489 34 1490S 1453S 1,098Mar 2014 1453 1487 37 1488S 1450 1,657May 2014 1478 1492 37 1494S 1476 97Jul 2014 1481 1498 40 1500S 1481S 128

Sep 2014 1468 1504 41 1468 1468 3Dec 2014 1514 41 0


Wednesday 6th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 1462 1452 -12 1469 1443 5,076May 2013 1466 1458 -10 1473S 1450 3,781Jul 2013 1476 1467 -9 1482S 1459S 1,618

Sep 2013 1483 1476 -9 1490S 1467S 953Dec 2013 1493 1480 -9 1495S 1471S 1,013Mar 2014 1479 1478 -9 1487S 1470S 143May 2014 1485 1483 -9 1492 1485S 27Jul 2014 1490 1489 -9 1490S 1490S 10

Sep 2014 1495 1495 -9 1495 1495 3Dec 2014 1505 -9 0


ALLIANCE OF COCOA PRODUCING COUNTRIES, NATIONAL ASSEMBLY COMPLEX, TAFAWA BALEWA SQUARE, P.O. BOX 1718, LAGOS, NIGERIA. TEL: +234-70-9814-1735; +234-70-

9814-1736; FAX: +234-1-290-4262 Email: [email protected] Website: www.copal-cpa.org

3

http://www.nybot.com/reports/dmrs/etsDMRs/dmrFutures.asp?dmrMonth=04&dmrDay=11&dmrYear=2007&commodityID=1&commodityType=future

http://www.copal-cpa.org/







Thursday 7th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 1448 1457 5 1472 1446 3,414May 2013 1454 1461 3 1474S 1451S 3,107Jul 2013 1463 1470 3 1484S 1463S 1,017

Sep 2013 1472 1479 3 1491S 1472S 728Dec 2013 1479 1482 2 1496S 1479S 809Mar 2014 1486 1479 1 1489 1480S 130May 2014 1489 1484 1 1489S 1489S 210Jul 2014 1489 0 0

Sep 2014 1510 1495 0 1510S 1505 6Dec 2014 1505 0 0


Friday 8th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 1458 1442 -15 1463 1440S 3,252May 2013 1461 1447 -14 1467 1446S 3,205Jul 2013 1472 1457 -13 1474S 1455S 1,251

Sep 2013 1482 1465 -14 1484 1463S 1,846Dec 2013 1482 1471 -11 1486S 1470 2,316Mar 2014 1480 1468 -11 1480 1466S 740May 2014 1473 -11 0Jul 2014 1479 1478 -11 1479S 1479S 5

Sep 2014 1503 1484 -11 1479S 1479S 9Dec 2014 1494 -11 0


Average for the week 1471 2200 2200



4










New York Board of Trade(New York Futures Market – Summary of Trading Activities)

(US$ per tone)

Monday 4th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 2205 2192 -13 2212 2181 19,800May 2013 2199 2197 -8 2212 2185 15,217Jul 2013 2238 2206 -9 2238 2195 3,129

Sep 2013 2226 2216 -10 2226 2205 1,467Dec 2013 2227 2227 -10 2227 2215 1,339Mar 2014 2245 2239 -9 2245 2225 895May 2014 2254 2247 -9 2254 2244 131Jul 2014 0 2256 -9 0 0 0

Sep 2014 0 2260 -10 0 0 0Dec 2014 0 2267 -10 0 0 0


Tuesday 5th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 2190 2246 54 2249 2189 21,502May 2013 2194 2249 52 2252 2194 16,051Jul 2013 2206 2257 51 2259 2206 4,120

Sep 2013 2219 2266 50 2268 2219 2,879Dec 2013 2254 2278 51 2278 2245 2,520Mar 2014 2240 2289 50 2290 2240 734May 2014 2274 2297 50 2296 2274 17Jul 2014 2286 2305 49 2304 2286 180

Sep 2014 2289 2310 50 2295 2289 20Dec 2014 0 2317 50 0 0 0


Wednesday 6th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 2243 2223 -23 2252 2209 22,137May 2013 2249 2227 -22 2254 2213 15,361Jul 2013 2253 2236 -21 2261 2221 3,687


Sep 2014 0 2290 -20 0 0 0Dec 2014 0 2297 -20 0 0 0




5









Thursday 7th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 2217 2238 15 2265 2214 23,841May 2013 2227 2236 9 2260 2218 24,580Jul 2013 2230 2244 8 2267 2230 3,777

Sep 2013 2238 2254 8 2274 2236 1,670Dec 2013 2272 2266 7 2286 2264 1,169Mar 2014 2283 2277 7 2297 2275 661May 2014 0 2284 8 0 0 58Jul 2014 2301 2291 6 2301 2301 19

Sep 2014 0 2297 7 0 0 4Dec 2014 0 2304 7 0 0 0


Friday 8th February 2013 Month Opening Trans Settle Change High Low Volume

Mar 2013 2234 2232 -6 2257 2225 20,399May 2013 2229 2227 -9 2248 2219 22,272Jul 2013 2237 2236 -8 2251 2228 3,707


Sep 2014 0 2287 -10 0 0 55Dec 2014 0 2294 -10 0 0 0


Average for the week 2262 7979 7979



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News

The benefits of Valentine's Day chocolateLas Cruces Sun-NewsBy Deborah Brandt 02/06/2013 Valentines Day is coming up. You may be wondering if chocolate is the best gift to give your sweetheart. The answer is yes! — particularly dark chocolate.

The Olmecs, one of the first civilizations in the Americas, were the original cocoa users. A beverage was the preferred way to enjoy cocoa beans. Chocolate's origins were medicinal, with more than 100 different uses recorded between the 16th and 20th centuries. Today, most cocoa beans come from the Ivory Coast in Africa.

Cocoa (Theobroma cacao) is the seed that chocolate is made from. Chocolate is rich in substances called flavinoids. Flavinoids and their related compounds are potent antioxidants, which reduce inflammation — a component of many disease processes. Flavinoids are found in fruits, vegetables, cocoa, red wine and tea. Consuming these foods and herbs can reduce heart disease and lessen the risk of stroke.

Over the past 10 years, there have been a lot of studies on dark chocolate or cocoa, many of them related to heart health. Chocolate has been found to lower "bad" cholesterol, while leaving "good cholesterol" alone. People who eat the most chocolate regularly have lower rates of heart disease. It seems cocoa improves blood vessel health and reduces inflammation of the blood vessels, which improves circulation.

Chocolate might reduce insulin resistance — the verdict is still out on that — but may be helpful in reducing the risk of heart disease in folks who have type II diabetes and are on medications. Other areas of promise include possible benefits in cancer prevention, and potentially reducing the risk of diseases such as Parkinson's, Alzheimer's and stroke.

For the skin, it appears that cocoa can decrease sensitivity to UV radiation from the sun and improve skin texture. Nibs from the cocoa bean are high in fiber and fiber is good for intestinal health. They also contain minerals such as magnesium, copper and iron.

Chocolate stimulates alertness because it contains caffeine-like compounds. Beneficial effects such as reduced fatigue and improved thinking ability last for about two hours after eating or drinking cocoa. Regular consumption improves blood flow to the brain.

A study was even done looking at pregnant women who regularly ate chocolate. A condition called pre-ecclampsia is a dangerous complication of pregnancy that can occur in the last few months of pregnancy. Pregnant women who ate chocolate one to three times a week throughout their pregnancy had a reduced risk of developing pre-ecclampsia. So, treat your pregnant sweetheart to chocolate too!

There is a perception that chocolate can cause acne and migraines, but this has not been shown to be the case in studies so far — although, I would rely on your own experience. Chocolate is a good addition to your regular diet. Certainly, over-indulgence can cause weight gain, so remember that moderation is the key.

So, go ahead, enjoy your chocolate for Valentine's, couple it with a glass of heart-healthy red wine, and toast each other with Cupid's blessings for a super-romantic, healthy Valentine's Day evening.

Attention chocoholics – a little chocolate is good for youWeatherford Democrat



7

NEWS

Health and Nutrition



By kathy SmithFebruary 10, 2013February is American Heart Month and is a month often celebrated with chocolate. The good news for chocoholics is that studies continue to show a link between chocolate and heart health. Several study reviews concluded that eating dark chocolate lowers the risk of heart disease.

Compounds in cocoa beans called alkaloids, theobromines and antioxidant flavonoids are responsible for chocolate’s health benefits. These heart health compounds are the same ones found in red wine, grape juice and tea. They have anti-inflammatory properties which provide protection against blood clots, improve cholesterol levels and help relax blood vessels, potentially lowering blood pressure.

But all chocolate is not equally beneficial. Some companies remove all or some of these compounds because they taste bitter. The theobromine also is a cardio-stimulant, while the level of this compound in dark chocolates is safe for humans to consume, it is toxic to animals.

Cocoa beans are initially fermented to develop the familiar chocolate flavor and aroma. After fermentation, the beans are roasted and crushed to a paste. Ingredients such as milk, vanilla, sugar and cocoa butter are added to produce chocolate.

A popular food trend is to carefully select cocoa beans and add unique flavors such as chilies, herbs and sea salt.

If you love the taste but also want the health benefits of chocolate here are some choices of what you want to look for on labels.

• Cocoa or cacao is expressed as a percentage on labels and refers to the total amount of cocoa butter, chocolate liquor and cocoa powder.

• Chocolate liquor is not a liquid and is not alcohol. It is ground bean nibs and may be listed as unsweetened cocoa.

• Cocoa butter is naturally present and is responsible for the melt-in-your mouth quality of some chocolates. The word butter in its name is not a dairy component; cocoa butter is fat from the cocoa bean.

• White chocolate is the blend of cocoa butter, sugar and flavoring. It doesn’t contribute to known health benefits and is not labeled as “chocolate” by the Food and Drug Administration since it contains no cocoa solids.

• Unsweetened baking chocolate is 100 percent cocoa without added sugar. It is too bitter for eating.

• Dark chocolate contains various amounts of cocoa solids plus cocoa butter, sugar and other flavors. Bittersweet chocolate typically contains less sugar than semi-sweet chocolate. The amount of sugar varies among brands.

• Milk chocolate is a combination of chocolate liquor, cocoa butter, sugar and flavoring plus milk solids.

Like many treats, chocolate should be enjoyed in moderations. Some suggest limiting chocolate to an ounce or two a day. Use these guidelines to make heart healthy choices.

• Dark chocolate has the most health benefits. The darker the chocolate, shown by a higher percent of cocoa solids, the lower the sugar content and the higher the antioxidant content. Look for flavonoid content on the label by percent cocoa.

• Dutch processed cocoa has a milk chocolate flavor. It has been neutralized to lower the acidity found in chocolate, but this also destroys the healthy antioxidants. Naturally unprocessed cocoa is a healthier choice.

• Some suggest that milk added to chocolate prevents the body from absorbing beneficial flavonoids.



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If you indulge in eating chocolate, swap extra calories from soda and other calorie laden snacks. Though research shows that dark chocolate’s benefits, it can’t make up for unhealthy eating habits. Choose wisely and you could help your heart; then savor every bite.

Kathy Smith is a Texas A&M AgriLife Extension Service agent for Parker County. Contact her at (817) 598-6168 or [email protected].

Efforts to revamp cocoa growingDaily MonitorBy Lominda AfedraruFebruary 6, 2013

Dr Patrick Wetala, a researcher, displays pods from one of the cocoa varieties. Photo by Lominda Afedraru.

There is potential for those farmers who intend to venture into cocoa production to use clean seedlings, which are multiplied by both private and public nursery operators including agricultural research institutes like the Coffee Research Institute (Corec) at Kituuza in Mukono District.

Dr Patrick Wetala, who is leading the cocoa research at Corec, says many farmers in Bundibugyo, Mukono, Kayunga, Iganga, Jinja, Kamuli, Buikwe, Masindi and Mayuge Districts, have developed interest in growing cocoa because the plant has the capacity to increase their income for better livelihood.

“Corec has been the main centre for cocoa research from 1956 when the first materials were planted. We obtained different varieties such as the Upper Amazon variety, which contain grooves. This variety is the best because it produces large pods and seeds. Others are Trinitario variety, which produces pods in red colour and is more tolerant to pest and diseases, and the Melonado variety, which produces small pods. We obtained all these varieties from Trinidad and Tobago and West Africa, especially from Ghana and Ivory Coast,” Dr Wetala explains.

Increase acreageLast year, about 17,000 tonnes of cocoa beans were exported by both the private and public players in the industry, which fetched a total revenue of $50m (Shs133bn), according to the researcher.

Currently, the focus of the research team is for farmers to engage more in replanting the crop in order to increase the acreage under cocoa. “Cocoa is a shed-loving crop and we usually advise farmers to intercrop it with other trees to provide shed because a cool environment with little sun rays will determine its yields,” Wetala said.

Two years ago, the Corec team conducted a survey covering the Busoga region and Mukono District, where farmers are engaged in growing cocoa.

They established that farmers in these areas prefer grow the crop organically but the challenge is pest and disease infestation. Whereas, according to Wetala, farmers in Bundibugyo are making significant progress in cocoa farming because they use pesticides to check pests and diseases, says Wetala.

New varietiesCocoa farmers are usually faced with the challenge of insects biting the pods causing them to dry up, birds which suck the juice out of the pods, aphids, caterpillars and leaf defoliators, which attack the leaves, and a disease known as verticillium wilt, which attacks the roots causing the tree to wilt and eventually dry up.



9

Production & Quality



Dr Wetala’s team usually advises farmers to follow good agronomy practices such as pruning the branches and leaves as well as providing a balanced shed for the cocoa trees to produce better yields. If followed, such agronomic practices can enable a single tree to produce over 20 pods.

New varieties from Ivory Coast have been introduced and are under evaluation at the institute. Once the results prove promising, they will be distributed to cocoa farmers possibly by mid this year.

Market for the productThe Bundibungyo-based branch manager of Esco Uganda, which exports cocoa, Mr Wilfred Aliganyira said since 1994, the company has been sensitising farmers in the district about the importance of engaging in cocoa growing.

This is because there are a number of private international companies that have showed interest in exporting cocoa grown in Uganda because of its good quality.

“What we basically do is sensitise them to maintain the cocoa trees and to get involved in multiplying the seedlings. This has enabled the production to increase from 7,000 tonnes per year to the current 17,000 tonnes,” he said. “If the sensitisation continues, more farmers will get involved because there is already a market for the product.”

Most of the exporters sell the cocoa to countries in the European Union, where it is used to make various products.

Higher chocolate prices may follow Africa's Cocoa shortfallBusinessweekBy Isis Almeida and Olivier MonnieFebruary 07, 2013

This Valentine’s Day, Americans will spend a record $1.05 billion on chocolate and candy, according to the National Confectioners Association. But while Mamert Kablan Angora helps keep sweethearts sweet by growing cocoa on part of the 15 hectares (37 acres) of Ivory Coast land his family has farmed for generations, his 31-year-old son with the same name prefers an office job in the nation’s biggest city. “I have seen my parents suffering in hoping that days will be better in growing cocoa, but the situation is deteriorating year after year,” says Mamert’s son, who works at

an import/export firm in Abidjan, where he can use his master’s degree in business. “Cocoa can no longer allow someone to take care of oneself or of a family.”

Villagers in West Africa, which produces 70 percent of the world’s cocoa, are abandoning the crop because its price is volatile, farms are too small to be economical, yields haven’t risen for decades, and alternative crops such as rubber are more lucrative. “Everybody is worried that the farmer is living on the edge of poverty,” says Barry Parkin, the head of global procurement and sustainability at Mars, whose products include M&M’s, the best-selling chocolate candy in the U.S. “They produce half a ton per hectare of cocoa, and it has been that way forever. All major agricultural products have improved their yields by a factor of 5 to 10 in the last 50 years, and cocoa hasn’t.”

The chocolate market expands by 2 percent to 3 percent a year, according to Zurich-based Barry Callebaut (BARN), the world’s biggest maker of bulk chocolate. Cocoa supplies, though, have lagged demand in 10 of the past 20 years, according to data from the International Cocoa Organization in London. The ICCO forecasts a shortfall of about 50,000 tons for the annual season, which began in October. And Parkin at Mars reckons demand will outpace production by 1 million tons by the end of the decade.

That means your chocolate kisses may cost more next Valentine’s Day. To deal with more frequent cocoa shortages, confectioners have been shrinking the size of chocolate bars and bon bons, adding more air bubbles to chocolate, or simply substituting more vegetable oil for cocoa butter. They also can pull from global



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stockpiles, which stood at 1.8 million metric tons as of Sept. 30, according to the International Cocoa Organization. But experts say it will be tougher to cope beyond 2020 without improved production.

“You must start with that core fundamental of improving cocoa yields, improving productivity on the farm … to build sustainable year-after-year strong crops that are more disease-resistant, that provide more pods per tree,” says Tim Cofer, European president of Mondelēz International (MDLZ), the world’s biggest chocolate company, with a 15 percent market share. Mondelēz sells more than $1 billion of Milka and Cadbury Dairy Milk bars a year.

Cocoa is hard to grow, and the trees don’t start producing until three to five years after being planted. Also, climate change threatens to make farming it even more challenging. The crop needs hot, humid conditions, with temperatures no lower than 18C (64F) and no higher than 32C, according to U.K. risk advisory firm Maple-croft. Temperatures in growing regions of Ivory Coast and Ghana, the second-biggest producer, are forecast to rise as much as 2C by 2050, while the optimum growing altitude will be 450 to 500 meters (1,476 to 1,640 feet) above sea level by then, compared with 100 to 250 meters now, according to the International Center for Tropical Agriculture.

Mondelēz says it will invest $400 million in the next decade to help growers raise yields and improve incomes. Barry Callebaut will spend 40 million Swiss francs ($44 million) in the same period to train farmers and help double yields. Blommer Chocolate, the largest U.S. cocoa bean processor, and Singapore-based trader Olam International (OLAM) last year formed a joint venture to invest $12 million to raise yields by 2015. And candy giant Nestlé (NESN) will invest 110 million Swiss francs in cocoa science and sustainability initiatives from 2010 to 2019.

Due to shortages and political instability, cocoa prices experienced annual swings of more than 20 percent in 10 of the past 20 years. Prices were below $1,000 a ton in the early 1970s and more than tripled by the end of that decade. By 1989 they were again below $1,000 a ton. Cocoa climbed to a 32-year high in 2011 but has since fallen 74 percent. After peaking at more than $2,700 in September, the price has slumped 18 percent to about $2,220. “The volatility of cocoa prices is one of the reasons we are facing this situation,” says Jean-Marc Anga, the ICCO’s executive director. “Some farmers have left cocoa and gone into rubber, palm oil, and other commodities. Unless you find a sustainable solution, you are not going to attract these people back into cocoa and keep them there.”

The bottom line: The global chocolate industry is girding for shortages of its key raw material, cocoa. Its price has fallen more than 70 percent since 2011.

Brazilian cocoa deliveries rise by a fifthAgraNet (subscription)February 06 2013WAREHOUSE deliveries of cocoa from Brazil's main growing regions and from imports were up 20% from May 1 to February 3, compared with the same period a year earlier, Bahia Commercial Association data showed.

Brazil is the world's joint-fifth cocoa producer, tying with Cameroon in the 2011/12 season. It ranked number two in the early 1990s, until plantations were devastated by Witch's Broom fungus. Brazil is now harvesting its 2012/13 main crop.

Ivorian cocoa arrivals still running behind last seasonAgraNet (subscription)February 06 2013COCOA arrivals at ports in top grower Ivory Coast reached around 854,000 tonnes by February 3 since the start of the season in October, exporters estimated on Monday, compared with 902,650 tonnes in the same period of the previous season.



11

The Market



Exporters estimated around 37,000 tonnes of beans were delivered to the West African state's two ports of Abidjan and San Pedro between January 28 and February 3, up from 25,583 tonnes in the same week a year ago.

Cocoa under ThreatBarron'sBy Alexandra WexlerFeb 9, 2013 Ivory Coast, the world's biggest supplier of cocoa, has implemented a minimum payment for cocoa farmers. That's made their product a lot more appealing to bandits and middlemen.

DJ-AIG Commodity Indexes

Look out, chocolate lovers: extortion in the world's No. 1 cocoa-producing country is threatening to hinder the global supply of chocolate and send prices of its key ingredient higher.

Ivory Coast, a West African nation that supplies 36% of the world's cocoa beans, is battling rogue police officers and soldiers who are blocking roads and demanding payment to allow beans to pass from farms to ports.

The banditry has occurred for decades, but recently has been exacerbated by the nation's new rules designed to make sure farmers get a fair price. As the farmers are able to sell their cocoa for more, the more attractive it is to steal. Both trends will conspire to send cocoa prices higher over the next three months, the period in which the majority of the crops are transported.

"A lot of farmers at the very local level are still a little bit uncertain in terms of their physical security and safety as they transport their beans to the market," says James Clinton Francis, a sub-Saharan Africa researcher at Eurasia Group, a Washington, D.C., consulting firm. In some cases, farmers are abandoning their efforts.[image]

Rather than risk "getting killed," says commodities analyst Jimmy Tintle, "farmers would much rather let [their cocoa beans] rot in the field." Tintle is the chief executive of GreenKey Alternative Asset Services, a commodities consultancy in Longwood, Fla.

This squeeze on cocoa supply comes as everyone's favorite bean was already heading for a deficit this year.

Goldman Sachs is already forecasting a global cocoa-supply deficit of about 100,000 metric tons during the 2012-13 crop year that began on Oct. 1. As a result, the bank pegged its 12-month forecast, released in a Jan. 13 report, for cocoa traded on the ICE Futures U.S. exchange at $2,500 a ton, a level that futures last traded at in December.

Front-month cocoa prices on ICE settled on Friday at $2,232 a ton, up 1.2% or $27 on the week.

GOVERNMENT REFORMS TO Ivory Coast's cocoa sector—required for International Monetary Fund aid—have pushed the decades-old racketeering to new and more dangerous heights. As part of the reform, the country now guarantees a minimum price to farmers of 725 CFA francs (about $1.50) per kilogram of cocoa beans.

Middlemen must pay at least that price to a farmer for beans that they will then transport to ports. However, the middlemen can find their margins slashed—or eliminated—when they have to sell the beans at levels based on international prices, which have been plumbing seven-month lows.

These intermediaries, when facing little or no profits, have a much greater incentive to throw in their lot with the ex-militia members and corrupt police officers who extort farmers bringing their beans to market, say analysts and traders. The middlemen can tip off the bandits as to when the beans are being transported—in exchange for a cut of the take.



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This is not a good situation in a nation with plenty of ex-soldiers who remain idle after a bloody confrontation that followed a disputed presidential election two years ago. "The second people start talking about any type of military presence [in Ivory Coast], you're looking at disruption and [a] fear premium being added to cocoa," says Hector Galvan, a senior broker at R.J. O'Brien Futures in Chicago.

Encourage cocoa processing, Investors urge GovernmentTHISDAY LiveBy Crusoe Osagie05 Feb 2013

Cocoa Products

The management of Multi-Trex Integrated Foods Plc has enjoined the Federal and State Governments to pay more attention to value addition by encouraging indigenous cocoa processors in the country.

The call was made by the Chief Executive of the company, Dimeji Owofemi, when students of the Armed Forces Command and Staff

College Jaji, Senior course 35 paid a visit to the factory in Ogun state led the state government officials.

He said because the army is saddled with responsibility for the security of the nation which includes food security, it is an opportunity to express the desire that the survival of the country is assured by all. “Government needs at this point to think seriously on where our interest as a country lies, whether in empowering the unemployed or enhancing employment in European countries, whereas countries like Ghana and Cote d’Ivoire that we can compare ourselves with are having more factories in capacity terms than Nigeria, because they impose taxes on raw cocoa beans exported out of their countries,” he said.

In his remark, leader of the student delegation and Director of the Department of Maritime Warfare, Commodore Kenneth Ati-John, said that the visit was linked to the theme of their study tour which is “diversifying the economy for national development.” “You can see that this company is positively contributing to the economy not just of the state but also of the country. They have been able to process cocoa from the basic level to finished products which is not common in Nigeria,” he said.

According to him, value addition has become the way to go for Nigeria’s economy because if the country keeps exporting only raw commodities it will continue to generate only a fraction of the revenue but when value is added there is a certainty of earning more income and revenue.

He described the of state-of-the-art facilities at the factory as positive and encouraging, noting that such high standards could only be found in big corporations like Cadbury and a few others in the country.

Stating the enormous opportunity in the sub-sector the chief executive of Multi-trex revealed Nigeria currently has a 96,000 metric tonnes capacity worth about $350 million in annual turn-over and is entirely operated by Nigerians through 11 indigenous companies.

Owofemi said that the time has come for a paradigm shift from exporting anything raw including crude petroleum to value addition. “Today we don’t have any refineries as I can see and without cocoa processing we will continue to export our raw commodities and we know that in the days when cocoa board existed there were no such activities,” he said.

He also noted that the export of the raw cocoa beans, which is needed by the indigenous processing factories was dominated by foreigners who are again rewarded by the government with Export Expansion Grant (EEG). “The minimum employment generated by the smallest cocoa processing factory is at least 150 people, here in



13

Processing & Manufacturing



and here at Multi-trex we have invested N15.4 billion already in this factory with 213 people in our direct employ and over 2000 in indirect employment,” he said.

He urged the government to provide opportunities for processing companies to thrive by cutting down the barrage of taxes and reviewing the tenement rate which went up from N400, 000 to N5 million from the year before. “We also want the government to look into our request for 5,000 hectares of land to grow cocoa and also look at our peculiar to extend the tenure beyond 5-10 which is not adequate to grow cocoa. If our application is granted we can create gainful employment for up to 10,000 people,” he said.

The Ogun state Permanent Secretary Bureau of Political Affairs and Administration, Oluremi Obayomi, remarked that Multitrex Plc clearly stands out as an example that Nigeria can diversify its economy and end the over-dependence on oil and gas. He assured the management that the Government of Ogun state was already looking into the issue of land tenure which was raised by the company’s C

First Cameroon cocoa powderConfectionery Production5 February 2013

Barry Callebaut has launched the first Cameroon origin cocoa powder on the market.

Its presence in Cameroon enables Barry Callebaut to source beans directly from the local cocoa farming communities and to directly process them in the country. The origin cocoa powder reflects the typical characteristics of the cocoa variety and the specific soil and climate conditions of Cameroon,

leading to its unique flavor.

The cocoa powder, available in low and high fat, has a premium taste profile characterised by a delicate hint of smokiness and cocoa notes. With its characteristic dark red color, the new cocoa powder opens up endless possibilities especially for bakery applications.

ADM Cocoa unveils increased processing capacity in SingaporeFoodBev.comBy Rebecca Prescott5 Feb 2013ADM Cocoa has completed the expansion of its production capabilities at its cocoa processing facility in Singapore.

The expansion, which involved the upgrading of existing equipment as well as the installation of new machinery, will increase the total output of cocoa products by about 17%.

The new processing capacity will help ADM Cocoa to meet growing customer demand for its premium quality deZaan cocoa butter, cocoa powder and cocoa mass (liquor) across Asia. The Singapore site is also home to one of ADM Cocoa’s Advantage Centres, an R&D resource centre where customers work directly with ADM’s cocoa experts on innovative product developments.

The facility also serves as a training centre, where customers can learn more about product applications, formulations and cocoa sustainability efforts undertaken by ADM Cocoa and other stakeholders.

Cargill won't reduce cocoa operationsAgraNet (subscription)February 06 2013CARGILL has no plans to reduce its cocoa processing operations in Ivory Coast, citing progress in talks with the government over abolished tax breaks for grinders and increased export levies.



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The company had said those decisions, taken late last year, would force it to re-evaluate its operations in the world's biggest cocoa grower.

Cadbury Nigeria seeks 100% ownership of Stanmark Cocoa DivisionBloombergBy Emele Onu at [email protected] Feb 6, 2013 Cadbury Nigeria Plc, a manufacturer of drinks and food products, said it plans to acquire the 2 percent of Stanmark Cocoa Processing Co. it doesn’t already own, to reduce the cost of running the unit and bolster revenue.

“Cadbury proposes to exchange one share for 5.58 shares of Stanmark” and then merge the companies, Kufre Ekanem, a spokesman for Cadbury Nigeria, said today in a telephone interview from Lagos, the commercial capital.

Stanmark has a 12,500 ton capacity plant in the south- western Nigeria city of Ondo and produces cocoa butter, liquor and powder. It supplies the entire cocoa powder requirements for Cadbury beverage products while the cocoa butter and liquor are exported, Ekanem said.

Nigeria is the fourth-largest cocoa producer after Ivory Coast, Ghana and Indonesia, according to the London-based International Cocoa Organization’s website.

The combination will make it easier for Cadbury Nigeria to refinance the cocoa business and raise output, Ekanem said. “The companies have applied to the court and the regulatory authorities for approval and believe the deal will be completed soon,” he said.

Cadbury Nigeria’s nine-month net income through September advanced 34 percent to 2.08 billion naira ($13.2 million) from 1.56 billion naira a year earlier, it said in a statement on Oct. 31. Revenue declined 2.4 percent to 24.1 billion naira.

The stock rose 3.5 percent to 37.27 naira in Lagos. It has climbed 29 percent this year, compared with a 19 percent gain for the Nigerian Stock Exchange All-Share Index.

Ghana agric workers campaign against child labour in cocoa growing areasGhana Business NewsFebruary 8, 2013

Child Labour

The General Agricultural Workers’ Union (GAWU) of the Trade Union Congress (TUC) has embarked on an intensive three-day sensitization programme at Saamang, in the Eastern Region.

The program in the cocoa growing community was to help fight child labour in cocoa growing areas in the country.

It brought together about 32 basic schools consisting of over 4000 pupils, teachers, chiefs and other stakeholders in the community where a sports festival was held for the pupils.



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Business & Economy

Labour Issues



GAWU used the occasion to enlighten the pupils about the importance of education and stressed on the need for them to stay in school.

Speaking to the Ghana News Agency, Mr Edward Tandaga Kareweh, Deputy General Secretary of GAWU, said agriculture was a very demanding venture which could disrupt the schooling of many children. “These children are exposed to toxic pesticides, fertilizers, dangerous blades as well as suffering bites from animals and insects and these can have immediate and long term impact on children,” he said.

Mr Kareweh said GAWU was vigorously embarking on a nationwide campaign in the cocoa growing areas against child labour adding that “we do not want to see children in labour because we believe in the dignity of labour.”

As part of the sensitization programme, GAWU also trained some farmers, stakeholders and parents to be agents of change in the cocoa growing areas in the region.

Some of the topics treated as part of the program included, Child Labour and Hazardous Work in Ghana’s Cocoa Farms, Hazards, Effects and Control Measures in Cocoa Farming, Protecting the Health and Well-being of Children and Farmers, First Aid for Common Farm Emergencies.

Mr Andrews Addoquaye Tagoe, Head of training and Education of GAWU, said the Union felt the need to assist and enlighten farmers on the correct usage and application of farming tools and chemicals. He said the training was aimed at raising awareness and to promote the well-being of children and farmers through the adoption of safe and healthy practices in cocoa production.

Mr Emmanuel Kodjo Kusi, the Regional Industrial Relations Officer of GAWU, urged farmers in the region to do well to always adopt the correct methods farming and apply the appropriate chemicals on crops in order to avoid food poisoning.

Southern Cameroon gets most rain in cocoa beltAgraNet (subscription)February 07 2013SHOWERS were seen in southern Cameroon in the West Africa cocoa belt last week while the rest of the belt was dry.

Mainly dry weather is expected this week as well other than some showers in southern Nigeria, favouring harvesting but leading to dryness for the mid-crop.

Cocoa turns higher on weather concernsFutures MagazineBy Jack ScovilleFebruary 8, 2013

COCOA

General Comments: Futures closed higher on forecasts for stressful weather for developing crops in West Africa. Hot and dry winds now could hurt the mid-crop production and also hurt some development of the crops for next year. Speculators seemed to be the best buyers as trends started to turn up on the charts. Malaysia and Indonesia crops appear to be in good condition and weather is called favorable. Overall

weather patterns in West Africa production areas are good for harvest progress and for the mid-crop and next crop, although hot weather now could increase stress to trees. Demand is still reported weaker from the US and



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Environmental Issues



Europe, in part due to current economics and in part due to changes forced by the World Bank that encouraged forward marketing of the crops. Traders are starting to look ahead and past the midcrop harvest and note that the market could move to a production deficit next year.

Overnight News: Mostly dry conditions are expected in West Africa. Temperatures will average above normal. Malaysia and Indonesia should see episodes of scattered showers, but Malaysia will be drier this weekend. Temperatures should average near normal. Brazil will get scattered showers and warm temperatures. ICE certified stocks are higher today at 3.823 million bags. LIFFE stocks are now 2,672 standard lots, 132 large lots, and 3 bulk lots.

Chart Trends: Trends in New York are mixed to up with objectives of 2270, 2330, and 2360 March. Support is at 2210, 2180, and 2155 March, with resistance at 2265, 2280, and 2300 March. Trends in London are mixed to up with objectives of 1475, 1510, and 1535 March. Support is at 1440, 1420, and 1410 March, with resistance at 1480, 1500, and 1510 March.

Germany cocoa in high global demandNewstrack India08 Feb 2013 Berlin, (IANS/DAPD) German chocolate is in high demand abroad. In 2012, the country sold cocoa products worth around $3.6 billion.

According to the Federal Statistical Office, German manufacturers exported 645,000 tonnes of chocolate and foods containing cocoa, with a value of 2.7 billion euros from January to November last year.

This was an increase of 5.7 percent in the total value of exported chocolate in comparison to the same period in 2011.

France bought over 13 percent of German chocolate, making it the biggest purchaser.

Britain was next with just over 11 percent and then Austria with nearly eight percent.

Germany imports 1.3 billion euros worth of chocolate.Belgium was the main supplier country, accounting for over 26 percent of chocolate imported into Germany.



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Promotion & Consumption

Others

Research & Development



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