(Business in Cameroon) - In the first half of February 2021, cotton development firm SODECOTON, an agribusiness giant operating in the three northern regions, finally shipped its stock of remaining cotton from the 2020 season. The 30,975 tons of cotton estimated at some XAF29 billion was not shipped during the 2020 campaign because of disruption in the international supply chain caused by restrictions issued to combat the spread of the coronavirus pandemic.
"The delays have been fully regularized. The situation caused a decline in the company’s 2020 revenues. It is not a loss as some people may have thought. The deferred receipts will be taken into account for the 2021 results. Hence, SODECOTON’s result for the 2021 fiscal year will be higher than usual (over XAF150 billion)," explains an executive of this joint-stock agro-industrial unit.
"Sodecoton has always sold its cotton under a forward contract, meaning the sold cotton can be shipped later, even after 12 or 14 months. The company is paid once the cotton is loaded on the ships taking it to its final destination. When this deferred shipment is delivered during a new campaign, it does not mean the cotton was not sold during the previous campaign or that the company recorded losses. It is just a delay in shipments and payments,” the same source explains.
SODECOTON supervises over 200,000 cotton farmers in the northern part of Cameroon. It is highly important for the region's economy. Sodecoton, which also produces refined oil and soymeal for farmers, is 59% controlled by the State of Cameroon, against 30% for the French firm Geocoton and 11% by Smic, a local company.