Business Panel
Global Cocoa and Chocolate Markets: New
Challenges, New Opportunities
Brussels, 18 September 2012
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Sustainability in cocoa and WCF Programmes
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Certification initiatives in cocoa
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CEN process on sustainable and traceable
cocoa
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Central- West Africa –some facts
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+/- 1-2 mln cacao farmers, family 4-7 members
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3-7 ha, 1-2 tonnes cacao/year, 2-5 bags/month
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Producer price as a percent of traded price: Ghana +/- 65%, CdI 41% ,
but new system with minimum prices (Brazil 92%)
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No large plantations -> cocoa/chocolate industry owns no cocoa farms
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Long/complex chain from farm to port
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App. 87% of European bean imports (beans & products) originate in
West Africa
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Certification? 5%-? > ‘low hanging fruit’, competition at all levels
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Child labour: no tolerance, no watertight guaranties
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Cocoa: Current Situation and Challenges
Quantity and Quality Issues
Policies/Public Investments
• Price volatility
• Diseases/pests losses (30%)
• Aging trees
• Post-harvest practices / quality issues
• Access and proper application of farm inputs – fertilizers,
pesticides, planting materials
• Crop substitution
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Human Capital Issues
Environmental
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Over 1.5 million small scale farmers in West Africa
Subsistence vs. commercial farming
High illiteracy rates
Child labor and farm safety
HIV/AIDS and malaria
Few farmer coops or groups (<15 %)
Limited research/extension services
Limited outreach to next generation
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Tax structures
Public extension services and research
Roads and storage facilities
Public education and health services
Finance/credit
Lack of innovation
Soil infertility
Climate change
Deforested lands
Preserving biodiversity
Changing patterns drought / flooding
World Cocoa Foundation
 Formed in 2000 to address cocoa sustainability
 90+ member companies from Europe, the Americas, Asia and Africa
and 85% of global turn-over
 Partnership/Roundtable Meetings every 6 months in different venues
 Programs in West Africa, Latin America, Southeast Asia, and Research
 Partnership Focus (Gates Foundation, USAID, USDA,BMZ/GTZ, Danida,
Swedish, host governments)
 Not a certifying body, but working with partners in a convening role
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World Cocoa Foundation – Proud of Our Members
WCF Mission: Sustainable Cocoa Economy
The World Cocoa Foundation promotes a sustainable cocoa
economy through economic and social development and
environmental stewardship in cocoa-growing communities.
Profit:
Improved and more
equitable economic
returns for farmers
People:
Healthy and thriving
cocoa-farming
households and
communities
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Planet:
Responsible, sound
environmental practices
Global Program Updates
West Africa
Southeast Asia
WCF/Cocoa
Livelihoods Program
Cocoa Project in
Vietnam
STCP
CoCoPal Philippines
WCF/ECHOES
Swisscontact Aceh,
Indonesia Program
IFC Cocoa Farm
Finance Program
Latin America
Peru Project
African Cocoa
Initiative
 Reached over 480,000
farmers & 20 countries
Research
WCF Challenge Grants
Borlaug Fellows
Germplasm & Breeding
Cocoa of Excellence
Monilia Resistance –
CATIE
Witches Broom
Resistance – Univ of
Trinidad
WCF Working for Sustainable Cocoa
Production
PROFIT:
Quality & Quantity
Issues
PEOPLE:
Human Capital
Issues
Farmer Field
Schools
Professionalize
farmers
Agro-forestry
Stewardship
Post-Harvest
Handling
Women
support
scholarships
Biodiversity
Diversification
of Farms
Improved
Planting
Material
Functional
Literacy
Training
Access to
Inputs
School
Agriculture
Clubs
Integrated
Pest
Management
Health & Labor
Best Practices
Program Focus
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PLANET:
Environment Issues
Functional literacy training adults
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Cocoa Livelihoods Program (2009-2013)
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The Cocoa Livelihoods Program will work with +/-200,000 smallholder, cocoagrowing households in West and Central Africa.
Overall goal of the program is to increase (double) farmer income while
strengthening local service capacity
Budget: $ 40 mln
Objectives:
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Marketing efficiency is improved: professionalizing 40 farmer organizations,
giving them the tools needed to expand their group marketing of quality cocoa
and improve services to their members.
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Cocoa production efficiency and quality are improved at the farm level:
training farmers on good agricultural practices, proper application of input
supplies such as fertilizer, post-harvest techniques and improving the
distribution of improved planting material.
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Farmers improve their competitiveness on diversified cocoa farms:
providing farmers with improved business skills to help them more effectively
manage their farms, encouraging diversification of household income and
developing Business Service Centers to provide needed farming services.
African Cocoa Initiative (ACI)
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Public-private partnership: World Cocoa Foundation (WCF), cocoa industry
members, the Dutch Sustainable Trade Initiative (IDH) and USAID
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Key government institutions in the four countries of Cameroon, Côte d’Ivoire,
Ghana and Nigeria.
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ACI is a $13.5 million, 5-year program
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Goal of institutionalizing effective public and private sector models to support
sustainable productivity growth and improved food security on diversified
cocoa farms in West and Central Africa.
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The program aims to double cocoa productivity for 100,000 farm households
and in doing so raise per capita income by 150-200%.
ACI: key components
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II.
III.
IV.
Strong National Partnership Platforms
Improved Productivity through Better
Planting Material
Enhanced Extension and Farmer Training
Services
Market-Driven Farm Input Services
Key Takeaways…
 No silver bullet to address diverse constraints
 Crop drives economic growth, employs millions in
producing and consuming countries
 Collective efforts are most effective
 We need successful farmers!!!
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Certification and CEN
Certification – the EU framework
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EU communication – contributing to Sustainabile
Development: The Role of Fair Trade and nongovernmental trade-related sustainability assurance
schemes
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Respecting the dynamics, no legislation
Proposal for a Directive on public procurement
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Labels (art 41)
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Certification – some facts
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Certification: private initiatives
FLO, Utz Certified, Rainforest Alliance
10 years old – response to crisis in coffee
Originally consumer focus
Today, farmer focus as important
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Important private and public commitments:
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Mars: 100% certified by 2020
Fererro: 100% certified and Source Trust by 2020
NL: 100% certified chocolate in 2025
Soft commitments in Germany: towards 50% by 2020
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Cocoa certified: <5%, coffee 8-10%
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Certifiers compete on all levels
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Certification – the challenges
Growth from single digit to double digit in a short period
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The sustainability/development issue:
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Farmer organization is vital
Supportive and enabling environment
Producer countries/producers still skeptical – CdI position
in CEN process
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‘Low hanging fruit’ is certified –reach ‘difficult’ farmers
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Commitments will generate huge pressure at producer
level
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Pressure should not result in ‘certifying poverty’
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CEN process on sustainable and
traceable cocoa
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Process started in May, meeting in September
Committee (TC415) to develop European (voluntary) standard
“Establish a framework which meets the needs of producers
and consumers/other stakeholders for sustainability of cocoa
production and traceability of the cocoa supply chain. The
outcome shall be a clear, measurable, robust and achievable
standard, which is cost effective for stakeholders and which
encompasses the following objectives”:
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Process: 3 years, if successful
Link work with ISO processes
All relevant stakeholder groups, consuming and producing
countries
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CEN process on sustainable and
traceable cocoa (3)
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Obtain clarity and transparency of requirement of sustainability of
cocoa bean production and for traceability of cocoa beans and cocoa
products.
Establish a credible and transparent measure of attainment of long
term sustainable cocoa production.
Obtain involvement throughout the entire standard setting process for
the CEN cocoa standard by an active participation of cocoa
producing and consuming countries.
Become a scaleable and implementable standard global recognised
for its inclusive nature as well as its ability to deliver long term
sustainability impact to which all standard schemes can align.
Support the eradication of forced labour, child labour and the worst
forms of child labour in conformity with the applicable ILO
conventions
Support the improvement of the standard of living, social conditions
and working and labour conditions, including health and safety, of
populations engaged in the cocoa sector
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CEN process on sustainable and
traceable cocoa (3)
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Improve impact of productive and sustainable cocoa production on
the environment.
Improve farmer income and livelihoods, including improving
productivity of cocoa farming, encouraging diversification of
production and income, and facilitating access to markets for cocoa
farmers
Upscale the production of sustainable cocoa beans in an efficient
manner and at viable costs.
Support and promote transparency on all costs and economic impact
of certification.
Promote farmer organization and empowerment
Improve communication on traceability and sustainability of cocoa
products
Liaise with ISO/TC 34 regarding quality and food safety.
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Final remarks
 WCF:
 is working with partners in a convening role.
 certification is a tool, not an objective.
 Some producing countries/farmer organizations are still
reluctant
 Upscale from current figure of cocoa certified to double
digit commitments in the near future without comprising on
the quality of the criteria used.
 Clearer view on role of certifiers.
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Thank you for listening and your patience!
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Further questions & more information
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Geert.waelkens@worldcocoa.org
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