Ivory Coast’s cocoa regulator plans to implement a reform of the domestic cocoa marketing system that will, within a year, eliminate middlemen to prevent risk and overpayment, an official and sources told Reuters.The reform will target intermediaries who act as scouts and buyers, sourcing cocoa beans from farms in the hinterland and reselling to exporters.According to the Coffee and Cocoa Council (CCC) regulator, independent intermediary buyers represent around 80% of the volumes purchased from farms and delivered in the ports of Abidjan and San Pedro, while cooperatives account for around 20% of volumes in the world’s top cocoa producing nation.The reform will rely on Ivory Coast’s new cocoa traceability and certification system that is being deployed by the CCC, and will be operational by October at the start of the 2024/25 cocoa season. The system will digitise payment for all cocoa bean sales or purchase transactions from the farmer to the exporter.“The intermediaries who collect the product to resell to other intermediaries will disappear because they will not benefit from this system,” Arsene Dadie, director of domestic marketing at the CCC, who is leading the reform, told Reuters. Dadie said the new system based on the farmers identification cards, which also serve as payment cards, will essentially rely on cocoa cooperatives that will be the only intermediaries between exporters and farmers.The CCC has identified 1.05mn cocoa farmers, and issued around 900,000 cards of which around 800,000 have been distributed. The regulator has said that 580 out of nearly 2,000 cooperatives are participating in a test deployment of the new sales system, as well as 22 exporters out of 100.“At the same time as we distribute the cards, we are gradually rolling out the traceability system among the cooperatives,” Dadie said, adding that the system will ensure that farmers are paid directly without any intermediary from next cocoa season.The CCC also aims to exclude intermediary scouts and buyers by reducing the number of permits issued to them, and introduce more restrictions which will eliminate those who fail to comply.“We have already identified all those who are responsible for the current overpayments, they will be excluded from the permits. We’ll also introduce severe measures including limiting the number of permits to better control them,” a source at the CCC with knowledge of the planned reform said, requesting anonymity to speak candidly.According to the CCC, around 40,000 metric tonnes of beans are being hoarded in farm warehouses by independent intermediary buyers who are delaying deliveries to ports, demanding up to 1,800 CFA franc ($2.96) per kilo for deliveries compared with the official farmgate price of 1,500 CFA franc.This has slowed down supply to exporters, forcing the CCC to suspend cocoa bean exports to enable local cocoa grinders to buy the necessary volumes for the factories.“Today, middlemen buyers and scouts control 80% of purchases in the farms but with the new marketing system that is coming, the cooperatives will take power. We clearly want to exclude the buyers,” the source at the CCC said.