Concern in the cocoa sector for 15,000 tons that will remain without exporting in 2021 due to logistics crisis

After breaking an export record in 2020 with 360,800 tons, the national cocoa sector is on track to end this 2021 breaking a new mark with around 365.704 t exported, some 5,000 t more than the previous year.

In numbers, the situation of the sector would seem unbeatable, however, what was initially projected to end the year was to export 380.704 t, that is, almost 20,000 t more than what will close in 2021.

Francisco Miranda, president of the National Association of Cacao and Industrialized Exporters of Ecuador (Anecacao), assured that about 15,000 tons of cocoa have been represented in the warehouses of the companies, regarding the global container logistics crisis at the international level, which impacts the domestic market with a significant drop in the price of cocoa.

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He noted that the listing price on the New York Stock Exchange has dropped to $ 2,378 per ton, until last week. In December 2020 the price was $2.729. Miranda added that in addition to this price drop, there has been a drop in spreads, paying – $ 400 over the market price, which results in producers who until last October received between $ 118 and $ 120 per quintal, now they are only perceiving between $ 70 and $ 80.

“The direct impact on costs is found in the contracts that come with the negative differential, it is one of the lowest differentials that we have seen in the history of Ecuador, resulting in greatly reduced prices to the producer,” lamented Miranda, who emphasized in There are international buyers, the requirements and needs for the product in the same way, but the lack of space in ships to transport the cocoa to the ports of destination and the strong congestion in American ports, are complicating the production chain.

While exporting companies feel this impact.

Iván Ontaneda, former Minister of Production, Foreign Trade, Investment and Fisheries, and CEO of Eco-kakao, estimated that until next January 25,000 metric tons of cocoa will be dammed in the country, causing serious financial, flow and storage capacity problems.

“We are in the middle of the main harvest in Ecuador, which started in September, with significant volumes that must be bought from producers, processed and evacuated, in that sense Eco-kakao maintains an important network of small producers nationwide , and has been receiving the volumes of this harvest, however, as we cannot evacuate it, we have very high inventories, “said Ontaneda.

The situation of his company also worries him, by ensuring that Eco-kakao exports the 52 weeks of the year regular volumes; and, due to lack of space and containers, they are receiving permanent cancellations from the shipping lines.

Although Ontaneda assured that the impact is for all destinations, they have felt the situation more in shipments to the markets of the United States and Europe.

For its part, Larry Vera, commercial manager of Maquita, another exporting company, recalled that the logistical problems in exporting worsened in the second half of this current year, which in the case of the company has meant a 26% reduction in the volume of exported grain, in relation to the last year; percentage that represents around 1,400 t of cocoa.

“The difficulty in generating export reserves with shipping companies has slowed down the rotation of our inventory; in addition to liquidity problems for the normal stockpiling of grain to producers and organizations linked to our commercial network, ”said Vera, who pointed out that the most complicated destinations due to these problems are Europe and Asia.

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Regarding the impact on producers, Vera agrees with the reading made by Miranda. It revealed that last January the spreads for ASE (Arriba Superior Selecto, according to its classification) cocoa export contracts were around – $ 100 / t, while currently for similar contracts these values ​​are at – $ 330 / t .

“This decrease in the differentials established by export prices represents approximately $ 10 per quintal; value that the producer ceases to perceive in the commercialization of their production ”, explained the Maquita executive, who warned that if the problem persists, they will adjust their cost structure to a size that allows the sustainability of the grain line to be achieved. in the face of limitations in export volumes; and to concentrate efforts on strengthening the production and commercialization of the products of its semi-finished and processed cocoa plant.

Ontaneda is less optimistic and warned that if this situation continues, they do not rule out closing part of their operations in different parts of the country, thus affecting the flow throughout the production chain.

For his part, Miranda assured that they plan for 2022 to improve credit capacities and internal storage, so that it allows them to deal with the logistics crisis that, according to him, “will last much longer than we expect”,

“However, the peak of the impact of this crisis is passing, because the harvest will end in the next few days, being able to evacuate the load that is dammed,” said the president of Anecacao. (I)