Ebola outbreak in West Africa could impact cocoa prices

A worker sits on bags of cocoa beans in front of an Ivorian cocoa cooperative in the village of Bonon, Ivory Coast, on Aug 10, 2014. It’s harvest season in Ivory Coast, the world’s largest producer of cocoa beans -- but there are not enough
A worker sits on bags of cocoa beans in front of an Ivorian cocoa cooperative in the village of Bonon, Ivory Coast, on Aug 10, 2014. It’s harvest season in Ivory Coast, the world’s largest producer of cocoa beans -- but there are not enough hands to help pick the beans. -- PHOTO: REUTERS

It’s harvest season in Ivory Coast, the world’s largest producer of cocoa beans -- but there are not enough hands to help pick the beans.

That's because Ivory Coast has shut down its borders with Ebola-hit Liberia and Guinea and many cocoa pickers are migrant workers from the neighbouring countries in West Africa.

Their absence, according to news reports and commodity traders, could delay shipments of the crop and send cocoa prices skyrocketing.

Fearing that the outbreak could raise prices, the World Cocoa Foundation is working with names like Nestlé and Mars to come up with a response to the crisis, reported Metro News.

The so-called Cocoa Industry Response to Ebola Initiative hasn’t been publicly unveiled, reported Politico. The WCF plans to announce details on October 15 during its annual meeting in Copenhagen, Denmark, on how donations from its members will fuel Red Cross and Caritas Internationalis’ work to help the infected and stop Ebola’s spread.

The current Ebola outbreak, concentrated in Liberia, Guinea and Sierra Leone, has resulted in more than 8,300 confirmed and suspected Ebola cases. Ivory Coast has yet to experience a single case of Ebola but analysts warn that even a small number of Ebola cases in Ivory Coast could have a sweeping impact in the cocoa market and the broader chocolate industry. Ivory Coast accounts for almost 40 per cent of the world’s supply of the chocolate ingredient.

“If there is an outbreak in Ivory Coast, you could easily see (cocoa) prices double,” Mr Edward George, head of research at African lender Ecobank, was quoted as saying by the Financial Times.

Cocoa is grown on tiny plots, with growers selling their beans to middlemen who ride from farm to farm on motorbikes gathering the crop to transport to the coast for export. The travel restrictions and quarantines used to contain the disease could quickly isolate millions of farmers, choking off supplies to the world's chocolate makers, reported Wall Street Journal.

Mr Tim McCoy, a senior adviser for the WCF, said signs that Ivory Coast residents already are concerned were immediately obvious during his last trip to the country in September.

“Going into meetings where … you always shake hands and often times, with men and women, you do the cheek kiss thing … They weren’t doing that,” Mr McCoy was quoted as saying by Politico.