Ghana has ditched plans of borrowing from international banks to fund its cocoa crop in the next season, breaking a 32-year-old tradition that has built its farms and economy.

Industry regulator Ghana Cocoa Board “wants to wean itself” from the annual syndicated loans, Chief Executive Officer Joseph Boahen Aidoo told reporters in the capital, Accra on Tuesday.

It will tap domestic sources to fund its cocoa purchases from farmers in the new season, which kicks off a month earlier this year on September 1, he said.

The move comes after Bloomberg reported that the world’s second-biggest producer of the chocolate-making ingredient was negotiating a bridge loan with cocoa traders, such as Barry Callebaut AG and Olam Group Ltd. because talks with foreign lenders for a syndicated loan of $1.5 billion had stalled.

The board typically raises a minimum of $1 billion each year to pay for seedlings, chemicals, fertilizers and to buy beans from farmers but last year it was only able to borrow $600 million as Ghana’s debt restructuring and a slump in the output reduced its credit appeal.

The crop harvest target for 2024-25 has been cut by 20% to 650,000 tons due to weather concerns, Aidoo said. Combined with disease and a lack of fertilizers, output in Ghana and top producer Ivory Coast was curbed, sending futures prices earlier this year above $11,000 per ton for the first time.

Absence of foreign cocoa funding means henceforth the Bank of Ghana will have to wait for revenue from the sales of the beans to build foreign reserves instead of the bulk amount it gets every October when the harvest starts. The central bank has used the foreign exchange to manage volatilities in the exchange rate.

“Whatever cocoa we sell is sold in dollars and so the revenue from our cocoa will be paid in dollars,” Aidoo said. “Our forward contracts will all be paid for in dollars when we deliver the cocoa so the dollars will come in to shore up the cedi.”