Ivory Coast sets Nov. 20 deadline for cocoa buyers to factor living income differential

ABIDJAN (Reuters) -Ivory Coast's Coffee and Cocoa Council has set a Nov. 20 deadline for cocoa buyers to account for a "living income differential" (LID) of $400 per tonne of cocoa on all contracts sold by Ivory Coast or Ghana, two council and four industry sources told Reuters on Friday.

Cocoa buyers have been dragging their feet on the LID and new positive origin differentials, saying it is not viable to pay so much for cocoa in a context of oversupply pushing prices down on the global market.

The sources said that cocoa buyers and other players in the sector were also required to pay positive origin differentials by Nov. 20.

Top cocoa dealers Cargill, Ecom Trading, Sucden, CEMOI, Barry Callebaut, Olam and Touton had all been informed about the new measures, they added.

Council representatives will meet Mondelez and other multinationals next week to relay the same message, the sources said.

Sources at Sucden, Olam, CEMOI and Barry Callebaut confirmed the deadline was set during a meeting in Abidjan with the Ivory Coast's Coffee and Cocoa Council on Thursday.

Cocoa industry players agreed in July to back the LID as part of an agreement to combat poverty among farmers in top producers Ivory Coast and Ghana.

Later that month, Ivory Coast's Coffee and Cocoa Council (CCC) and Ghana's regulator Cocobod raised the premium that chocolate makers and traders pay for their high quality beans.

The Coffee and Cocoa Council (CCC) set this origin differential at zero for August compared to -125 pounds/tonne in July, while Cocobod raised it to 20 pounds/tonne in August compared to -50 pounds/tonne in July.

"We had a meeting with Cargill, Cemoi, Touton, SucDen, Ecom, Barry Callebaut and Olam... and clearly told them they have until November 20 to account for the LID and the origin differential of zero," a CCC source who did not wish to be named told Reuters.

"Otherwise all their sustainability programmes will be suspended," the source added.

The programmes are set up by major buyers to fight child labour, improve cocoa bean quality and increase the revenue cocoa farmers get.

A second CCC source confirmed the deadline and said buyers would no longer be allowed access to cocoa farms to count pods - key to predicting the size of crop yields - if they failed to comply.

(Reporting by Ange Aboa,Writing by Sofia Christensen;Editing by James Macharia Chege and Emelia Sithole-Matarise)

By Ange Aboa