The global spread of Covid-19 in the first half of 2020 occurred at a somewhat slower pace on the African continent than elsewhere, but brought similar disruptions to business and social life. The virus was first detected in Côte d’Ivoire in mid-March, and one month later the country had one of the highest infection rates in sub-Saharan Africa. Ivorian authorities responded with a number of precautionary measures in an effort to limit the spread of the virus. Cargo shipments, however – crucial for the agriculture sector – were not subject to the government’s movement restrictions.
Impact on Agriculture
One of the greatest threats to agriculture in the midst of Covid-19 is the possibility of disruptions to supply chains, particularly for fresh produce that might spoil during transit delays. Agriculture is a primary economic driver in Côte d’Ivoire: composed primarily of smallholder farms, it accounted for around half of employment in 2018, while contributing 23% of GDP and almost 40% of all exports. Although the Ivorian agriculture sector relies heavily on export-oriented crops, the majority of commodities do not have a short shelf life.
The country’s greatest export commodity by tonne is cocoa, and output from Côte d’Ivoire accounted for around 40% of global cocoa production in 2018, according to the World Bank. Some international chocolate companies anticipated lower-than-usual sales during the Easter period in 2020, and any dips in demand could take some time to bounce back, even after restrictions on daily movement – and thus business operations – are lifted. This sentiment, however, is not ubiquitous; investment bank Credit Suisse suggested the pandemic may not significantly dampen demand, signalling that US confectioner The Hershey Company may see a rise in sales. This is good news for Ivorian farmers from whom Hershey and other major companies source their beans. The bank upgraded the rating for the chocolate manufacturer – for which Côte d’Ivoire and Ghana are its primary source markets for cocoa beans – from “neutral” to “outperform” in mid-March 2020, citing the fact that chocolate consumption may rise during the crisis.
Increasing the level of domestic cocoa processing, which would raise value added for both the Ivorian economy and farmers, has been high on the government’s agenda for some time. Côte d’Ivoire’s processed cocoa output was around 530,000 tonnes in 2018, which positioned the country second only to the Netherlands globally, according to the World Bank. The country’s volume looks set to accelerate further following measures taken by international chocolate companies – including Switzerland’s Barry Callebaut and US-based Cargill, both of which have grinding facilities in Abidjan – to increase their local processing capacity and tap various financial incentives introduced in January 2020. The results for February 2020 show an increase of around 4% on the same month of the previous year, from 226,000 tonnes to 235,000 tonnes.
Covid-19’s Agricultural Impact
The challenges faced by Côte d’Ivoire’s agricultural exporters brought on by Covid-19 reflect those of the global economy. In the short term, disruptions in international supply chains may impact the ability of Africa’s food producers to meet demand in other parts of the world. The UN’s Food and Agriculture Organisation has urged countries to reduce the cost of trade by streamlining and removing bottlenecks, particularly by way of digital solutions. In the longer term global supply chains may come to operate more efficiently, which could offer cost savings for Côte d’Ivoire’s economic engine in the years to come.
To address the economic consequences of the pandemic, in April 2020 the government announced it would provide CFA250bn ($429.8m) to support major agricultural export crops, including cocoa, cashew nuts, cotton, rubber, oil palm and coffee.