Ivory Coast Seeks to Expand Cocoa Processing Capabilities and Asia Market Share

Ivory Coast, the world’s largest cocoa producer, is ramping up efforts to expand its cocoa processing capabilities as it considers selling a larger stake in its Transcao cocoa processor to Malaysian cocoa giant Guan Chong Berhad (GCB). This potential move is part of a broader strategy to tap into Asian markets and solidify Ivory Coast’s position as a global leader in cocoa processing.

On Wednesday, GCB announced that its Singaporean subsidiary had acquired a 25% stake in Transcao from Ivory Coast’s Coffee and Cocoa Council (CCC). However, according to CCC Director Yves Brahima Kone, the Ivorian government is open to GCB increasing its stake further, pending government approval, as part of its long-term vision for the cocoa sector.

A Shift Toward Cocoa Processing Powerhouse

Although Ivory Coast produces the largest volume of cocoa globally, the majority of its output has traditionally been exported as raw beans. Transcao, established to bolster local cocoa processing, is part of the country’s strategy to shift from being a raw material exporter to a key player in the global cocoa processing industry.

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Transcao currently operates one plant with a capacity of 50,000 metric tons, but a second plant, set to open by the end of 2024, will increase its total capacity to 190,000 tons by the end of 2025. The partnership with GCB is expected to bring in valuable technical expertise and provide training for Ivorian staff in key areas such as sales and operations.

Building a Cocoa Empire with Global Reach

Ivory Coast’s ambition to become a cocoa-processing powerhouse is backed by an aggressive government policy that includes tax cuts and incentives to attract investment in local processing. The country already has an installed processing capacity of over 800,000 tons, with plans to reach 1 million tons in the next two years as new plants come online.

The partnership with GCB is seen as a key step in expanding Ivory Coast’s footprint in Asia, one of the fastest-growing markets for cocoa products. “We want to go beyond and master all trades related to processing, and GCB will help us achieve this goal,” said CCC Director Kone.

Global Cocoa Market Dynamics

Ivory Coast’s strategy to increase local processing and strengthen its presence in the Asian market could have significant implications for global cocoa trade. As the country boosts its production capacity, it may influence cocoa prices and trade flows, with ripple effects for major cocoa buyers and processors around the world.

The International Cocoa Organisation (ICCO) forecasts Ivory Coast’s cocoa production to reach 2 million metric tonnes in the 2024/25 season, recovering from a dip in production in the previous season due to adverse weather conditions. In contrast, neighbouring Ghana is expected to produce only 500,000 tonnes, hindered by artisanal mining and plant diseases like swollen shoot disease.

Challenges Ahead

While Ivory Coast is optimistic about reaching its production targets, weather conditions remain a critical factor. Excessive rainfall has already caused some damage to cocoa flowers and developing pods, which could affect overall yields. Nonetheless, the country’s investment in processing infrastructure and partnerships like the one with GCB position it well for long-term growth.

Ivory Coast’s cocoa sector is not only vital to its economy but also a key player in the global cocoa supply chain. As the nation builds its processing capacity and diversifies its market reach, its influence on the cocoa industry will continue to grow, making it a pivotal force in the global chocolate trade.