Cocoa Origin Focus: Ivory Coast part 2
- Diego Miranda
- Mar 11
- 9 min read
In just seven months, the Ivory Coast, the undisputed juggernaut of cocoa production, will host elections featuring Laurent Gbagbo and Alassane Ouattara. This is essentially a rematch between the leaders of the 2010 civil war. For those who know their history, this was a time of turmoil in the Cocoa markets.
Cocoa price crashes, dramatic rallies and a severe crisis led the country in an unexpected direction, culminating in new policies and regimes that continue to have a major impact on the cocoa market today.
In this blog, the second part of our Cocoa Origin Focus on Ivory Coast, we will explore how the cocoa crop was a key aspect in the economic and political landscape of this African nation, how it fueled the flames of civil war and ethnic conflicts, how its cocoa production evolved in the last 20 years and what the future holds.
Precursor to War
Many countries have a traumatic, defining event in their past, and for the cocoa producing behemoth, Ivory Coast, these events are the two civil wars of 2002 and 2010.
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The seeds of internal strife were sown with the death of the popular president of Ivory Coast, Félix Houphouët-Boigny. He had been in office for 33 years, ruling the country since independence from France in 1960. When he died in office in 1993, his chosen successor was Henri Konan Bédié who served out the remainder of Boigny’s term. However, Boigny’s reign was controversial and exacerbated fractures among the different tribes and ethnic groups.
In an attempt to reverse the persistent economic downturn, the Bédié administration adopted a less interventionist approach to the cocoa markets, dissolving the Caitab in 1999.
At the same time, the new administration adopted an aggressive rhetoric against immigrants and descendants of ethnic groups who were not native to Ivory Coast. By the 1990s, these groups represented a large part of the population, mainly due to the influx of workers for the cocoa farms.
Bédié instituted policies which provoked disputes between these groups and native ethnic groups over cocoa land. Although he was reelected in 1995, ethnic and political conflicts continued to accelerate until the inevitable conclusion, a military coup, which ended Bédié's presidency in 1999, forcing the former president to flee in exile to France.
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The First Civil War
The first civil war, which was largely about cocoa land, began with the fall of the military government. Laurent Gbagbo won an election in the year 2000 against Robert Guéï who represented the military government. During his administration, Gbagbo continued to amplify the ethnic and religious tension in Ivory Coast, which led to the start of the war in 2002 between his government and the rebels.
The outbreak damaged the already crumbling economy of Ivory Coast even more and divided the country in two, with the South under Gbagbo’s government control, while the rebels ruled over the North. This is when the fight over cocoa land reached its apex. The conflicts that had already occurred for more than 50 years intensified amid the chaos and lack of legality, allowing many different groups to claim property and invade each other’s cocoa farm lands without opposition.
More than that, control over cocoa became an important factor for both sides of the war. The cocoa crop represented the biggest sector of Ivory Coast’s economy, with its production being an important source of revenue for the government as well as the rebels, and many fights occurred over control of cocoa farms.
Since most of the farmland was located in the South and South-West of the country, Gbagbo’s administration was able to retain the majority of such profits, giving him an advantage against the New Forces.
Although the war officially ended in 2003 with the intervention of the French government and the UN to help establish peace talks, the Ivory Coast remained divided. The violence continued until the Ouagadougou Peace Agreement, which formed a power-sharing arrangement and allowed Gbagbo to continue his term as president, until new elections were held in 2010.
Cocoa Decline
Besides the escalation of national conflicts, the 21st century also brought the end of the cocoa efficiency boom in Ivory Coast. By the year 2000, the country reached its maximum yield of 0.7 MT per hectare; after that, returns started to diminish at an alarming rate, in a process that has not been reversed even today.
Among the causes for this decline in productivity, the most obvious reason is the civil unrest in the country. Ivory Coast's internal wars led to a disruption of supply chains, higher inflation, destruction of infrastructure, continuous transfer of farmland properties, and uncertainty.
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Additionally, the strife led to reduction in best farming practices, which fostered increases in pests and diseases, with particular damage caused by cocoa swollen shoot virus (CSSV), which became more aggressive and prevalent in cocoa pods around that period, despite having been well under control in the decades prior.
Lastly, the turmoil has led to lack of investment in new trees. The last cocoa boom in Ivory Coast happened in the 1950s, after World War II, this means that most trees were decades old by the 2000s. In general, cocoa trees are considered old when they reach 40 years and start seeing a quick decline in yield after that age. The lack of new planting, the lack of investment in farming inputs and the abandonment of best practices took its toll on cocoa production in this period.
Second Civil War
Unfortunately for the people of the Ivory Coast and for global cocoa production, the challenges were not over yet. A second civil war started when Gbagbo refused to step down after his defeat in the 2010 elections. Violence quickly escalated afterward, with hundreds of people killed in small conflicts across the country. The process continued until a new civil war broke out.
This time, the rebels prioritized targeting cocoa coastal towns, such as Sassandra and the port city of San Pedro, the world's largest cocoa exporting port. The rebels learned the lesson of Cocoa’s importance from previous conflicts, they saw control over Ivory Coast’s main economic asset as essential to establishing victory.
Fights also resurged among farmers over cocoa land. One tragic event stands apart for its brutality, the Duékoué massacre. Attackers wielding machetes and firearms killed over 1,000 civilians during an invasion of the city by Ouattara's forces. Beyond the politics, the root cause of the massacre is believed to be a dispute over cocoa land. Most of the victims were of Guere ethnicity, who composed the majority of the landowners in the region, while migrant descendants and other groups performed most of the manual work in the fields.
The warfare caused great alarm in the cocoa industry at the time. In January of 2011, Outtara called for a cocoa export ban to stifle a key source of revenue to Gbagbo. Commodity giant Cargill temporarily shut down operations in the country and all of the major chocolate companies issued statements on the impact to their production. Naturally, cocoa prices surged as a result.
Fortunately, the second civil war was considerably shorter than its predecessor, ending on April 2011 after a dramatic storming of Gbagbo’s compound by French forces and Outtara loyalist. With the former president Gbagbo arrested and his government defeated, Alassane Ouattara was sworn in as president, a position that he holds to this day.
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2015 Cocoa Shortage
The wars might be over, but sadly the Ivory Coast cocoa industry is not enjoyed a return to its former glory. Although total production has increased over the years, productivity has continued to decline, even after a more stable, internationally recognized government came into power.
Natural disasters and weather shocks have punctuated the production problems in Ivory Coast and underscored the current vulnerability of the global cocoa supply chain. This is a vulnerability common in commodity markets where production is centralized in one geographic location. Ivory Coasts' position as the world's leading cocoa producer means that global supply is extremely vulnerable to adverse events in that region.
One such event occurred in 2015 and resulted in a sharp increase in cocoa prices, with the NY market soaring by more than 60% to reach $3,500 per metric ton. This price may not seem impressive by today’s standards but it matched the heights reached in 2011 during the peak disruption caused by the civil war.
The 2015 shortage was primarily caused by two major factors: a severe drought and the spread of the Ebola virus across West Africa. The drought drastically reduced cocoa yields, as dry conditions are particularly harsh on cocoa plants, which require consistent rainfall to thrive. This environmental stress was compounded by the Ebola outbreak, which not only disrupted labor availability but also affected trade routes and the overall economy in the region.
The crisis brought long-standing issues within the Ivorian cocoa industry to the forefront. Challenges such as aging plantations, insufficient investment in modern agricultural practices, and poor labor conditions highlighted the urgent need for reforms to enhance the sector's resilience.
There have been attempts to restore cocoa productivity and invest in Cocoa production in the Ivory Coast. The Coffee and Cocoa Council (CCC) was established in 2012, and it aimed to stabilize cocoa prices through an auction system, however, it has proven unable to eliminate the inevitable impact of supply and demand on cocoa prices.
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2023/24 Supply Shock
Even the impacts of the 2015 drought, though, pale in comparison to the greatest challenge to Ivory Coast cocoa production to date. In 2023, another series of unfortunate events struck Ivory Coast, along with the second largest producer, neighboring Ghana, resulting in the biggest rally in the cocoa market’s history. Prices surged from $2,500 per metric ton at the beginning of 2023 to over $12,000 per metric ton by April 2024.
The primary driver of the rally was a shortage caused by adverse weather conditions. Bad weather was further exacerbated by the El Niño phenomenon, which disrupted normal rainfall patterns. The region experienced erratic rains that caused the premature yellowing of cocoa pods and increased the prevalence of fungal diseases like Brown Rot and Swollen Shoot, significantly reducing crop yields that had already been declining for decades.
As a result, cocoa shipments from Ivory Coast to ports fell by 28.5% year-on-year in the first quarter of 2024. This downturn forced the Ivorian government to postpone contracts for the main crop as they grappled with the ongoing crisis.
Looking to the Future
Change is a constant everywhere, not only in the cocoa industry. We have seen dramatic changes to the political landscape in Ivory Coast, as well as the productivity in the world’s largest cocoa producer. However, one thing that seems unlikely to change is the primacy of the Ivory Coast as the world’s workhorse in cocoa production.
Since the rally began, international supply chains were severely affected, highlighting the continued significance of Ivory Coast in global cocoa markets. Many multinational companies had to seek alternatives to cocoa and cocoa butter, as dramatic price increases happened all over the chocolate sector.
We do see some positive changes. The new shortage not only reinforced the many problems already mentioned in the cocoa industry but also brought to light other issues that had gone unnoticed, such as the low wages of Ivorian farmers. In response to the market rally, the government announced an increase in compensation to local producers from 1,000 CFA francs per kilogram to 1,500 CFA francs. This appears quite a generous increase at first, but compared to a 300% rise in cocoa prices, a mere 50% raise is perhaps insufficient.
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The rise in prices does offer some hope for improvement of production though. It is said that the cure for high prices is high prices. The persistent high prices in the cocoa market should attract attention to the cocoa sector of the Ivory Coast both from the local government and multinationals who rely on the production there.
One major change that has been pushed for and come to fruition over the last decade is the investment in grinding capacity.
It is a common criticism among former European colonies that natural resources such as cocoa are extracted for export, but the value addition is done far from where it is grown. Over the last 10 years we have seen increased investment in grinding capacity in the Ivory Coast, so that more of the expertise and profit can be developed closer to where the cocoa is grown. Current grind capacity is for about 40% of the country’s production with a stated government goal of 100% by 2030. This is a trend that may continue in the coming years if it proves successful.
However, in order to meet the production and grinding goals, political stability will be essential. Gbagbo was acquitted by the International Criminal Court in 2019, and his acquittal upheld in 2021. Shortly thereafter he was invited to return to Ivory Coast by his political rival, President Outtara. Gbagbo arrived in Abidjian on 17 June, 2021.
It remains to be seen whether the country will remain stable. Gbagbo has returned to politics. He founded the African People's Party – Cote d'Ivoire (PPA-CI) shortly after his return to the country in 2021. Just last year, in 2024, he announced that he would again run for president in October 2025—only six months away. We can only hope that the rematch between Gbagbo and Outtara will be a peaceful one.
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