ABIDJAN: Ivory Coast will allow cocoa exporters to roll over last season's unexecuted export contracts into the current 2016/17 season, according to a document from the marketing board, the Coffee and Cocoa Council (CCC), seen by Reuters.
Exporters said the measure was intended to help companies avoid defaulting on contracts and could involve between 60,000 and 120,000 tonnes of beans.
The world's top cocoa grower sells forward the bulk of its anticipated crop and uses the average sale price to fix a guaranteed minimum price for farmers.
However, cocoa arrivals at Ivory Coast's two ports dropped by nearly 13 percent in 2015/16 compared to the previous season, and the lower output, caused by poor weather, left many exporters struggling to find beans to fill contracts. The 2016/17 season opened at the start of October.
"Contracts from the 15/16 main crop and mid-crop not executed by Sept. 30 and not covered by physical stocks ... are delayed to the 16/17 main crop with no financial prejudice," said a note from the CCC to exporters seen by Reuters.
The Ivorian main crop runs from October to March and the mid-crop from April to September.
The CCC is also seeking to help exporters who are currently holding stocks but have not yet executed their contracts from last season.
They will have until the end of next month to export their beans while still benefiting from last season's tax regime, the note said. Exporters said this measure was aimed at companies that purchased beans and failed to hedge, speculating that world prices would rise. Global cocoa prices have, however, fallen steadily for much of this year.
"The CCC wants to help companies avoid defaulting, but I don't know if that is going to be possible because the market is so low right now," said a representative from one international exporter.
"An exporter came to us with some of these contracts to sell them, but we refused because it's not profitable."
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