Government outlines measures to revive cocoa amid sharp price drop

Cocoa prices, which had reached between Sh32,000 and Sh36,000 per kilogramme in recent years, have dropped significantly to about Sh5,540 per kilogramme at the latest auction—far below the indicative price of Sh10,000.

The decline prompted the Cereals and Other Produce Regulatory Authority (Copra) to convene a meeting with stakeholders from key cocoa-producing regions to chart a path forward for the sector.

Tanzania currently produces cocoa in four main regions—Mbeya, Morogoro, Tanga and Songwe—while Kagera also records smaller volumes. About 32,500 farmers are engaged in the crop’s production.

Speaking during the stakeholders’ meeting in Mbeya, Copra Director General Irene Mlola said the price drop reflects developments in the global market, particularly among major producers.

She explained that two years ago, the world’s largest cocoa producers—Ivory Coast and Ghana—experienced severe weather conditions and disease outbreaks that disrupted production.

Ivory Coast produces about two million tonnes annually, while Ghana accounts for roughly 700,000 tonnes.

The production shocks, Ms Mlola said, initially pushed global buyers to purchase large volumes in advance and store them in anticipation of future shortages.

“They expected supply shortages for a prolonged period and therefore stocked up heavily,” she said.

However, the two countries later recovered their production levels, leaving international buyers with large reserves in storage, she said.

At the same time, cocoa demand surged due to its use in products such as confectionery and chocolate, which also influenced market behaviour.

“As we speak, Ivory Coast alone has about 100,000 tonnes in storage without buyers, which explains the current price situation,” she said.

She added that some international buyers had already signed forward contracts exceeding Tanzania’s production capacity, leaving limited immediate demand in the market.

“This is why prices have dropped from around Sh32,000 to about Sh8,600 and even lower in some auctions,” she said.

Despite the current price slump, Tanzania has made steady progress in increasing output, rising from 12,000 tonnes in 2023 to about 17,000 tonnes in 2025. The government aims to expand production to 80,000 tonnes by 2030.

Strategies to revive the industry

To address the situation, the government and stakeholders have agreed on a five-point strategy aimed at strengthening the cocoa industry.

The first strategy focuses on increasing production from the current 17,000 tonnes to 80,000 tonnes by 2030. This will involve improving access to quality seedlings and expanding cultivation.

Secondly, the government plans to improve product quality so that Tanzanian cocoa can compete effectively in international markets despite producing lower volumes than leading countries.

As part of the effort, Copra plans to establish seven cocoa drying facilities before June this year, with plans to expand the number to 20 in the next financial year.

The facilities will also help to ensure compliance with international environmental standards, including European Union regulations on deforestation.

The third strategy involves promoting organic farming practices to enhance market acceptance and sustainability while attracting greater investment from farmers.

Another measure is the introduction of contract farming arrangements, which would allow farmers and processors to secure reliable markets and raw material supplies, similar to arrangements already used in the coffee industry.

The fifth strategy focuses on promoting domestic value addition by encouraging local processing of cocoa.

“Even if we cannot reach 100 percent local processing in the short term, deliberate efforts must be made to develop this crop through our industries,” Ms Mlola said.

She added that the government is also working to improve the business environment for agro-processing industries to expand access to international markets.

During the meeting, Assistant Registrar for mobilisation and coordination, Mr Ibrahim Issa, stressed the need to build processing factories to strengthen the crop’s market value.

He said construction of a cocoa processing plant has already started in Rungwe District in Mbeya Region, while plans are underway to establish another facility in Kyela District after land for the project was secured.

Mr Issa also urged cooperative societies to enforce strict quality control measures and improve data management on farmers, similar to the systems used in the coffee industry.

“We will continue working with stakeholders to implement joint plans aimed at strengthening market resilience and creating a favourable environment for this crop,” he said.

Mbeya Regional Commissioner Beno Malisa said the price decline is largely a global issue and called on stakeholders to work with the government to restore stability in the sector.

“Since the price challenge is global, our responsibility is to focus on improving the value and quality of our cocoa,” he said.

“We must address the price challenge strategically rather than emotionally, and the government will continue working closely with industry stakeholders.”

Farmers demand factories

Farmers, however, say the price fall has severely affected their livelihoods.

One farmer, Mr Obed Mwakatoga, said producers were shocked by the sudden price drop.

He urged the government to prioritise building processing factories so farmers can add value to their produce instead of selling raw beans.

“We have heard promises about factories for many years, but implementation remains slow. If this is done, we will overcome the price challenges because we will process our cocoa locally,” he said.

Mr Mwakatoga also noted that many cocoa trees in Tanzania are ageing, with some plantations relying on trees that are 40 to 50 years old.

Under recommended agricultural practices, he said, cocoa trees should ideally be replaced after about 25 years to maintain productivity.