COCOBOD raises GH¢3.396bn as it shifts cocoa financing to domestic market

The Ghana Cocoa Board (COCOBOD) has raised GH¢3.396 billion from domestic institutional investors through the maiden commercial paper issuance of Cocoa Capital PLC, as it seeks to reduce its reliance on external borrowing to finance cocoa purchases.

The issuance forms part of a GH¢16.3 billion Domestic Cocoa Notes Programme established through Cocoa Capital PLC, a wholly owned subsidiary of COCOBOD, to mobilise funding from Ghana’s domestic capital market.

The programme comprises GH¢14 billion in commercial paper to finance cocoa purchases and GH¢2.3 billion in bonds intended to refinance existing debt within the cocoa sector.

The inaugural issuance, known as Series 1 (Tranche 1), has been admitted to the Ghana Fixed Income Market (GFIM) of the Ghana Stock Exchange, marking a new step in COCOBOD’s efforts to develop a domestic financing framework for the cocoa industry.

Speaking at the listing ceremony, COCOBOD Chief Executive, Dr Ransford Anertey Abbey, described the initiative as a shift from financing arrangements that have historically relied on government budget allocations, offshore syndicated loans and buyer pre-financing.

He explained that cocoa purchases over the past three decades had depended substantially on external borrowing, making it necessary for the Board to explore alternative and more sustainable sources of funding.

According to Dr Abbey, the domestic financing model is intended to mobilise available funds within Ghana, reduce dependence on offshore borrowing and strengthen the relationship between the country’s capital market and its cocoa industry.

By accessing domestic institutional investors, COCOBOD aims to broaden its funding options and establish a financing structure that supports the purchase of cocoa beans while making greater use of local financial resources.

The maiden issuance attracted bids of approximately GH¢3.586 billion from 38 institutional investors, with GH¢3.396 billion accepted at a clearing yield of 11%, according to reported transaction details.

The successful mobilisation of the funds provides COCOBOD with working capital to support cocoa purchases during the 2026/27 crop season.

Dr Abbey said the proceeds from the first series would be directed towards financing cocoa purchases, a critical part of the Board’s operations and its engagement with cocoa farmers across the country.

The initiative is also expected to support efforts to ensure that cocoa farmers receive timely payments for their produce, although the ultimate impact will depend on how effectively the funds are managed and deployed.

The COCOBOD Chief Executive underscored the importance of maintaining financial discipline and accountability in managing the proceeds from the issuance.

He pledged that the Board would uphold transparency, comply with reporting requirements and meet its debt-service obligations under the financing arrangement.

The commitments are intended to reinforce investor confidence and support the development of a sustainable domestic funding framework for the cocoa sector.

Dr Abbey also expressed appreciation to the government, financial regulators, market institutions, transaction advisers and participating investors for their contributions to the successful issuance and listing.

The GH¢16.3 billion Domestic Cocoa Notes Programme represents an effort to diversify COCOBOD’s financing sources at a time when securing funds for cocoa purchases remains central to the operations of Ghana’s cocoa industry.

Through Cocoa Capital PLC, the Board is seeking to deepen participation by domestic investors and strengthen the connection between Ghana’s financial markets and one of the country’s major agricultural export sectors.