Armajaro considers winding down cocoa ops in Ecuador

Cocoa trader Armajaro is considering closing its operations in Ecuador, but says it is business as usual in the Ivory Coast.

A spokesperson told this site that Ecuadorian cocoa trading was currently under review.

“We have withdrawn from our up-country buying operations because of adverse market conditions on the ground. “

“We are now considering the remaining operations on the ground, as we look to optimise the returns from all our businesses. It is Armajaro's strategy to focus on higher-margin businesses, and this review is part of executing on that strategy."

Small crop for fine flavor beans

Ecuadorian cocoa is much sought-after given its status as a flavor bean or fine flavor. ADM Cocoa and Cargill R&D chiefs have also identified Ecuadorian beans as their personal favorite origin.

Ecuador produces the largest volumes of all other fine flavor bean countries, but its crop total in 2010/11 was only 161,000 MT, just 4% of the total global production.

The crop has also been hit by adverse weather, which may explain why Armajaro doesn’t see Ecuador as a high-margin business.

Bloomberg reported last year that Ecuador may lose a quarter of its cocoa harvest after heavy rainfall.

Reuters said in a recent article that Armajaro was also considering shutting down its Ivorian operation based on insider sources, however this was denied by an Armajaro spokesperson.