Nigeria Cocoa Shipment Resumes

Posted by Michelle Howard July 18, 2014

Exporters have resumed loading of cocoa shipments in Nigeria's second-largest producing area, Cross Rivers state, after the state government suspended on Friday a levy on bean exports, a trade body said.

Cocoa shipments from Cross Rivers, which produces annual volumes of around 60,000 tonnes in the world's fourth-biggest producer, had been halted for over a week as exporters protested the state's failure to adhere to a court ruling last week to repeal the tax.

About 500 tonnes of cocoa due for export were stuck in warehouses while shipments were suspended.

The Cross Rivers state government in 2011 introduced a levy on cocoa exporters who ship the beans through Nigerian seaports other than the state's Calabar port. Exporters went to court to stop the levy.

The state aims to generate revenue through its seaport and compete with more established seaports in the commercial capital Lagos. Cocoa farmers said they paid around 300 million naira ($1.85 million) last year to the state government in levies.

Godwin Ukwu, spokesman for the Cocoa Association of Nigeria, said on Friday that the state government had suspended the 5,000 naira ($30.90) per tonne levy on cocoa exports, pending a meeting with exporters next Tuesday.

"The levy has been suspended for now ... Exporters have started loading cocoa. Trucks will be leaving between today and Tuesday," Ukwu said.

Cocoa exports from Cross Rivers are usually destined for Europe. Taxes on exports including cocoa are usually collected by the federal government.

A mix of rainfall and sunshine in the two main cocoa areas of Ondo state and Cross Rivers last month have helped the crop but there are fears that a lack of sun may allow diseases to spread, hurting bean quality.

Ukwu said the logjam could affect output this season as it delays exports. Nigeria typically produces around 250,000 tonnes every year. Official figures for 2013/2014 cocoa output have not yet been released.

($1 = 161.90 naira)