ABIDJAN/ACCRA, IVORY COAST, the world’s top cocoa grower, set its minimum rate for farmers at 700 CFA francs ($1.23 )per kilogram for the 2017-18 crop, a steep drop over the previous year, due to falling global prices.

Lambert Kouassi Konan, chairman of the country’s cocoa regulator said the price is the same as what producers got paid for the smaller harvest during the six months through September and is the lowest for the main crop since 2012, when the nation reformed the sector to secure better compensation for farmers.

The minimum price guaranteed to farmers was 1,100 CFA franc per kilo at the start of the 2016-17 season.

Although production increased 28.5 percent to a record 2.15 million tonnes in the 2016-17 season, world cocoa prices have fallen by more than a third.

Cocoa prices slumped by more than 40 percent in the 12 months through April and have struggled to recover since, partly because bumper crops in both Ivory Coast and neighboring Ghana, the second largest producer.

It is difficult. It is true that the price it is disappointing but I think that we must not be ungrateful towards the government of Ivory coast. For two years of our prices were significantly higher in those of our neighbors, said Cisse Sidikiba, head of Ivory Coast’s National Cocoa Growers Association.

Prior to Sunday’s announcement, president Alassane Ouattara consulted with his Ghanaian counterpart, President Nana Akufo-Addo, to narrow the price gap between the two countries.

Ghana has choses to keep its prices unchanged at the equivalent of $1,725 a ton since October last year and is ruling out a cut for the new season, raising the likelihood of smuggling from its neighbour.

The cocoa industry accounts for 15 percent of Ivory Coast’s GDP and two thirds of jobs in the west African economy.

Separately, GHANA’s industry regulator Cocobod plans to open the 2017/18 cocoa seasons on Oct 13, later than usual, after receiving part of a syndicated loan it signed this month to cover its purchasing needs, officials said.

The world’s second-largest cocoa producer does not plan to lower the producer price at which it buys beans from farmers, however, despite calls from top grower Ivory Coast for it to do so, the officials said.

In recent years Cocobod has opened its crop year in the first week of October.

The PPRC (producer price review committee) will meet soon, and it’s very obvious there will be no price cut.

Ghana has maintained its price at $1,914 per tonne since a year ago, creating a price gap of more than $700 per tonne that exporters said has fuelled a wave of cross-border smuggling.

The PPRC (producer price review committee) will meet soon, and it’s very obvious there will be no price cut, one official said.

Head of the cocoa industry regulator said Ghana delayed the start of the new cocoa season as the country waits for the proceeds of a $1.3 billion syndicate loan to pay farmers.

The country’s Cocoa Board Chief Executive Officer Joseph Boahen Aidoo said the purchase of the bigger two annual harvest will commence in the middle of october.

According to him, the regulator’s producer price review committee, which sets the minimum pay for growers, will be meeting next week.

We are waiting for the first tranche of the $1.3 billion syndicated loan to hit cocoa board’s accounts before we open the season, he added.

The regulator signed a $1.3 billion loan with international lenders this month for the new season’s purchases, estimated at around 850,000 tonnes. The first tranche of the money is expected to arrive in the regulator’s account next week, one official said.

Ghana closed its 2016/17 crop year on Sept 14 with output expected to total around 950,000 tonnes, the highest since a record 1 million tonnes in 2010/11.