The Ghana Cocoa Board (COCOBOD) has established a new subsidiary, Cocoa Capital PLC, to address the sector's liquidity challenges. Cocoa Capital PLC is set to raise up to GH¢16.3 billion to fund this season's cocoa purchases and clear old debt. This move is crucial in ensuring that cocoa farmers receive timely payments for their produce. The fundraising effort is part of the government's cocoa sector reset agenda, aimed at introducing a more sustainable financing model for the industry.
The bulk of the funds, GH¢14 billion, will be raised through a Commercial Paper programme, which is a short-term IOU issued to investors to raise quick cash. The Commercial Paper programme is designed to meet the short-term liquidity needs for cocoa purchases during the 2026/27 crop season. The remaining GH¢2.3 billion will be mobilised through medium-to-long-term bond issuances to refinance existing COCOBOD legacy debt. This approach is expected to put the sector on firmer financial footing going forward.
Cocoa Capital PLC has secured approval from the Securities and Exchange Commission to raise the funds through Ghana's domestic debt capital market. The Commercial Paper portion will be issued in tranches over the coming weeks, with the timing shaped by cocoa purchase funding needs and prevailing market conditions. The repayment of the borrowed funds will be backed by receivables from selected cocoa forward sales contracts assigned to Cocoa Capital PLC.
Six banks have been listed as Bookrunners for the programme: Absa Bank Ghana Limited, CalBank PLC, Fincap Securities Limited, GCB Bank PLC, One Africa Securities Limited, and Stanbic Bank Ghana Limited. These banks will play a crucial role in facilitating the fundraising effort and ensuring the smooth execution of the programme. The involvement of these banks is expected to provide a level of credibility and stability to the fundraising effort.
The timely payment of cocoa farmers is a critical aspect of the cocoa sector, with hundreds of thousands of Ghanaian households depending on cocoa income. COCOBOD's financing directly determines whether farmers get paid when they deliver their beans. In the past, COCOBOD has released large sums to Licensed Buying Companies to clear payment backlogs, including a GH¢2.6 billion release in July 2026.
The new GH¢16.3 billion raise is intended to cover an entire crop season's purchasing needs upfront, rather than relying on periodic top-up releases after farmers have already waited to be paid. This approach is expected to provide a more stable and predictable source of funding for cocoa farmers, enabling them to plan and manage their finances more effectively.
Cocoa Capital PLC has not disclosed a full disbursement schedule, but further announcements on individual issuances are expected in due course. The successful execution of the fundraising effort will be critical in ensuring the stability and sustainability of the cocoa sector in Ghana. The outcome of this initiative will be closely watched by stakeholders, including cocoa farmers, investors, and industry experts.
Key points
- COCOBOD's subsidiary, Cocoa Capital PLC, aims to raise GH¢16.3 billion to fund cocoa purchases and clear old debt.
- The fundraising effort is part of the government's cocoa sector reset agenda, aimed at introducing a more sustainable financing model for the industry.
- The successful execution of the fundraising effort will be critical in ensuring the stability and sustainability of the cocoa sector in Ghana.
