Cocoa traders have resumed purchasing cocoa from Côte d'Ivoire, the leading cocoa producer globally, following the country's decision to eliminate price premiums that had contributed to a significant backlog of unsold cocoa. The (Côte d'Ivoire Coffee and Cocoa Council) allowed for pre-contract purchases for the upcoming secondary harvest, which begins in April, without the previously imposed price premiums meant to bolster farmer income and ensure quality. This decision is crucial in alleviating the stagnant sales, as major companies had refrained from buying due to the inflated prices resulting from the premiums.

The removal of the price premiums, which were between $250 and $470 per ton above the global futures market prices, marks a significant shift in Côte d'Ivoire's cocoa policy. The country, alongside Ghana, had introduced a 'living income' premium of $400 per ton in 2020 to enhance farmer earnings, along with an additional quality-related premium. This change reflects the mounting pressures that cocoa-producing nations are facing, especially as demand has declined amid soaring prices, with New York futures nearing $13,000 per ton.

The shift in policy signals a potential re-evaluation of how cocoa prices are managed and could have broader implications for the sustainability of cocoa farmers' income. While the intent behind the previous price premiums was to support farmers, the economic reality of declining demand has prompted a reconsideration that may ultimately affect the livelihoods of those who depend on cocoa production in the long-term.