The Licensed Cocoa Buyers Association of Ghana (LICOBAG) has warned of a looming collapse in the cocoa sector due to severe funding and liquidity challenges, urging the Ghana Cocoa Board (COCOBOD) to urgently settle outstanding payments.

President of LICOBAG, Samuel Adimado, raised the alarm while speaking on Adom FM’s Dwaso Nsem, noting that delays in payments to Licensed Buying Companies (LBCs) are already having a ripple effect on cocoa farmers nationwide.

According to him, government must immediately secure funding to pay for an estimated 300,000 metric tonnes of cocoa in phases between now and September.

“Government must, as a matter of urgency, secure a facility to pay for about 300,000 metric tonnes of cocoa in a phased manner. Wherever COCOBOD can get the money, they should try and get it to us so we can pay our members, and our members can also pay the farmers,” Mr. Adimado said.

He explained that the prolonged payment delays have forced many LBCs to pre-finance cocoa purchases through local banks at interest rates as high as 29.8 percent, putting immense financial strain on companies.

“The traditional syndicated funding has failed, and a hybrid funding model is urgently needed to prevent further delays in payments to farmers,” he added.

Mr. Adimado further appealed to COCOBOD to immediately clear outstanding payments for cocoa beans already supplied by LBCs, warning that continued delays could destabilize the entire value chain.

His comments come amid growing concerns over a deepening financial crisis in Ghana’s cocoa industry, a situation that threatens the livelihoods of thousands of cocoa farmers if swift intervention is not taken.