A drop in world cacao prices due to a surge in cacao production has “worsened the plight of farmers, slashing their earnings by about 30 percent on average” (Jean-Marc Anga, ICCO)
The Ivory Coast’s Minister of Trade, Souleymare Diarrassouba, addressed the World Cocoa Conference in Berlin saying, “it’s been very harmful for the producers, who wonder what sustainability means for the cocoa sector. “
Niko Bebenham, Vice President of Sustainability at Barry Callebut notes that to make cocoa sustainable, the industry must shift away from a “selfish” focus on ensuring supplies and towards promoting crop diversity.
Companies and governments gather yearly at the World Cacao Conference to address the immune system of the cacao industry pledging to tackle poverty, deforestation and human rights abuses in supply chains.
The four day conference reviews efforts to “stamp out exploitation and environment degradation in cacao.”
It’s clear that whatever the cacao giants have been doing these past years has not been working. A surge in cacao production last season caused prices to plummet being at the lowest in more than nine years.
Companies and government’s business strategy was to increase productivity over the past years. This strategy lead to depleted plantations, plunging cacao prices and a surge in forced child labor across Cotes d’Ivoire and Ghana, two countries whose combined cacao production, account for more than 70 percent of the world’s supply.
The business model needs systemic change and more cacao production is not the answer. Resources need to be administered in order to professionalize farms and diversify incomes. Chocolate makers and processors must also ensure they are paying a fair price to farmers, who currently command only 6 percent of the $100 billion value chain, the ICCO mentioned.
A Reuters report noted that chocolate companies earned $3.5billion in 2017 and none of the money found itself back on the cacao plantations.
Producing countries must tighten their cacao production policy, topping production at a sustainable level.
While cocoa consumption and production has helped developing countries become more resilient to global market volatility, producing countries remain vulnerable to numerous illicit business practices.
Cotes d’Ivoire and Ghana must find a way to ensure that policies protecting their environment and forests are enforced in order to stop illegal cacao farms currently profiting from human rights abuses and further devastating the environment. Sustainability is achieved when all actors benefit. For more information about supply chain and corporate sustainability follow http://www.atilasocialimpact.com or @atila_films .
Coming soon – Connected, a documentary about the underbelly of modern day slavery, supply chain transparency and the path to redemption.
Connected highlights the brands that use their might towards a slave free future and the consumers that follow suit; enabling systemic change, building trust, and creating a better tomorrow.
Cristina Sarnoff 