Ivory Coast's cocoa regulator has restricted 20 major traders, including Cargill and Barry Callebaut, from purchasing beans for export after they reached their buying limits, the head of the Coffee and Cocoa Council (CCC) said on Thursday.
Port arrivals have slowed as the world's top cocoa producer heads towards the end of its October-to-March main crop, raising concern exporters might default on their contracts due to tight supply.
The CCC refuted this on Monday but said measures would be implemented to limit extra purchases and stock-building by some exporters while others struggled to meet their requirements.
'Purchasing Limits'
"We have informed 20 exporters who reached their purchasing limits for the main crop that we have closed registration for them," CCC head Yves Brahima Kone told Reuters by phone.
Traders concerned include giants Cargill Inc and Barry Callebaut, as well smaller local companies, Kone said.
He explained the CCC was activating a limit on extra cocoa bean purchases set up during a 2012 reform to protect smaller exporters from multinationals.
Barry Callebaut said it had been able to fulfill its normal buying patterns and that factories in Ivory Coast were running as per usual.
"We remain in constructive dialogue with CCC and will resume our normal buying pattern as soon as the temporary measures are lifted," spokesperson Frank Keidel told Reuters via email.
Cargill did not immediately respond to a request for comment.
The Biggest Buyers
The two companies are the biggest buyers of Ivorian beans and also the largest cocoa grinders in the West African country.
Industry sources said the purchasing limit would allow smaller local exporters to honour their commitments.
"It will facilitate cocoa purchases for exporters like us who need beans because the biggest have been buying everything available since January," said the head of a local export company who did not wish to be named.
Another unnamed local exporter said the measure may still not be enough.
"The truth is that there is no longer enough cocoa for everyone," he told Reuters.
Main crop yields have been lower than usual this season due to months of below-average rainfall and poor weather conditions.
Kone said the shortages were unexpected but assured the CCC had pre-sold beans with a sufficient security margin to avoid defaults.
"There is enough volume... those who have funding and contracts will be able to buy all the cocoa they need, we will make sure of that," he said.
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