February 6, 2018 / 12:58 PM / a year ago

W.Africa to meet cocoa demand as other regions stagnate - Cargill

ABIDJAN, Feb 6 (Reuters) - West Africa is meeting an ever larger share of the world's booming demand for chocolate, as other cocoa-growing regions in the Americas and Southeast Asia see crops stagnate and farmers move into other areas, Cargill's Africa director said.

In a Reuters interview at his office in Abidjan late on Monday, Lionel Soulard, director of Cargill's cocoa-focused Africa business, said the industry expected a small global surplus in 2017/18 - of about 100,000 to 150,000 tonnes.

The global surplus was 370,000 tonnes in 2016/17, according to the International Cocoa Organisation (ICCO).

Much of this excess has been on the back of an output boom in Ivory Coast. West Africa produces about two thirds of the world's cocoa; Ivory Coast, the biggest grower, one third.

"Yes, there has been a boom in production, but then we also see constant growth in demand. More and more, cocoa will be coming from Africa," Soulard said.

"It's obvious, when you see the other crops (cocoa in other regions) stagnating or going down."

He said much of the current boom was coming from Ivory Coast, with Ghana and Cameroon showing slower, if any, growth.

Ivory Coast has repeatedly broken records in the past five years, producing more than 2 million tonnes of cocoa in 2016/17, an increase of a third over the level half a decade earlier.

Arrivals in number-two producer Ghana in 2016/17 were just under a million tonnes. Some of that was smuggled from Ivory Coast, which unlike Ghana does not have a regulated cocoa price, and the amount was still just shy of its record 2010/11 crop.

But in Indonesia, the world's fourth-largest grower, output is expected to drop 10 percent this season to around 240,000 tonnes. Production in Brazil has never recovered to more than half of what it was in the 1980s - though Ecuador has seen a steady rise in recent years, driven by the high-end market.

"It's in competition with other crops. It's also a smallholders' crop ... rather than a big industry crop," Soulard said, explaining the trend.

"We believe West Africa will meet future demand."

A great deal of Ivory Coast's boom has happened on the back of a surge in illegal plantations inside protected rainforests, including several inside national parks, triggering a backlash from environmental campaigners.

In November, at a conference linked to the Paris agreement on climate change, the chocolate industry committed to tackling rampant deforestation. Cargill has set itself a target of zero cocoa coming from newly deforested land by 2030.

Soulard said this would be achieved by working more closely with cooperatives, better data collection and new technology for GPS mapping of farmers and their plots, to ensure they aren't farming inside national parks. All these measures would make the cocoa supply chain more traceable.

"We can change a lot of things and this new technology is the opportunity," he said. (Editing by Dale Hudson)

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