The Ghana Cocoa Board (COCOBOD), through its wholly owned financing vehicle Cocoa Capital PLC, raises GH¢3.39 billion from the first tranche of its new domestic Commercial Paper programme, falling short of its GH¢4 billion target as it begins a major shift away from traditional offshore cocoa financing.

The funds are raised at an interest rate of 11 per cent over a 266-day tenor, according to people familiar with the outcome of the transaction.

The maiden issuance represents about 84.8 per cent of the amount targeted, leaving a financing gap of approximately GH¢610 million.

The outcome provides an early indication of the capacity of Ghana’s domestic capital market to support cocoa purchases under a financing structure that seeks to mobilise funds from local banks, pension funds, insurance companies, investment managers and other institutional investors.

The new arrangement forms part of the GH¢16.3 billion Domestic Cocoa Notes Programme established by Cocoa Capital PLC, a special-purpose vehicle created and wholly owned by COCOBOD.

Under the broader programme, GH¢14 billion is earmarked for Commercial Paper to meet short term financing requirements for cocoa purchases during the 2026/27 crop season, while GH¢2.3 billion is expected to be raised through medium- to long-term bonds to refinance COCOBOD’s legacy debt.

The Commercial Paper is being issued in tranches, allowing COCOBOD to raise funds in line with its purchasing requirements and prevailing market conditions rather than mobilising the entire seasonal requirement at once.

The first tranche is targeted at GH¢4 billion, with subsequent tranches expected to raise another GH¢4 billion and GH¢6 billion, bringing the planned Commercial Paper component to GH¢14 billion.

The shortfall in the maiden transaction, however, raises questions about how the remaining GH¢610 million will be covered and whether subsequent issuances will attract sufficient demand to meet the overall seasonal financing requirement.

It is not yet clear whether Cocoa Capital will seek additional financing to close the first tranche gap or rely on subsequent Commercial Paper issuances to make up the difference.

COCOBOD Seeks to Replace Financing Model

The development comes as COCOBOD seeks to replace a financing model that has depended heavily on syndicated loans from international banks for more than three decades.

According to COCOBOD Chief Executive Dr. Ransford Abbey, the previous arrangement provided liquidity but also tied a significant proportion of Ghana’s cocoa crop to offshore financiers

“While effective in providing liquidity, it also required between 70 per cent and 92 per cent of the cocoa crop to be collateralised to offshore financiers.”
CEO of Cocoa Board, Dr. Ransford Abbey

The new domestic model is therefore intended not only to provide funding for cocoa purchases but also to increase local participation in financing the industry and retain more value within Ghana.

The financing structure is backed by receivables from selected executed cocoa forward-sales contracts assigned to Cocoa Capital PLC. Proceeds from those contracts are expected to flow through designated ring fenced accounts with appointed account banks and be distributed according to a predetermined payment waterfall.

This structure is designed to give investors greater visibility over the cash flows supporting repayment while separating the financing vehicle from COCOBOD’s broader operational finances.

Using Cocoa as a Collateral

The programme also introduces a different approach to the use of cocoa as collateral. COCOBOD says it intends to limit the proportion of the crop pledged to support financing, with Dr. Abbey indicating that the board is targeting a ceiling of 60 per cent.

“One of the other things we’ve also decided to do is to try and collateralise not more than 60 percent of the crop.”
CEO of Cocoa Board, Dr. Ransford Abbey

The approach is intended to allow COCOBOD to raise funds in stages and recycle the financing as cocoa purchases progress, reducing the amount of the crop that must be committed at any particular time.

The domestic financing initiative also comes against the backdrop of efforts to address liquidity challenges that have affected the cocoa purchasing chain.

COCOBOD’s previous reliance on syndicated financing came under pressure in recent seasons, while buyer-financing arrangements introduced subsequently also created difficulties, including delays in payments within the cocoa value chain.

The new model is consequently being positioned as part of a broader reset of Ghana’s cocoa sector.

COCOBOD has said the programme is intended to support timely cocoa purchases, address legacy financial obligations and create a more sustainable financing framework for the industry.

Cocoa Capital PLC was incorporated in August 2026 with paid-up capital of GH¢5 million. It has received approval from the Securities and Exchange Commission to raise funds through the domestic debt capital market, with its securities listed on the Ghana Fixed Income Market.

The six bookrunners for the programme are Absa Bank Ghana, CalBank, Fincap Securities, GCB Bank, One Africa Securities and Stanbic Bank Ghana.

Restructuring the Cocoa Sector

COCOBOD has described the broader restructuring as a significant step towards strengthening the cocoa sector, improving financial discipline and creating greater opportunities for domestic participation.

“This Turnaround Signals a Cocoa Sector That is More Resilient, Disciplined, and Built to Deliver Value at Every Level,” COCOBOD tells investors.

The first GH¢3.39 billion mobilisation therefore represents a significant start for Cocoa Capital, but it also exposes the financing challenge ahead.

The key test will be whether subsequent tranches attract sufficient domestic investment to deliver the full GH¢14 billion required for seasonal cocoa purchases.

For COCOBOD, the success of the programme will ultimately depend not only on how much money is raised but also on whether the financing reaches Licensed Buying Companies in time, supports prompt purchases and payments, and enables the cocoa sector to operate without the disruptions associated with previous funding arrangements.

The maiden transaction demonstrates that domestic investors are willing to commit substantial resources to cocoa financing. However, the GH¢610 million gap shows that the new model still has to prove that Ghana’s capital market can consistently provide the scale of funding required to finance the country’s cocoa industry throughout the 2026/27 season.