Introduction: Nothing like chocolate!

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1 Introduction: Nothing like chocolate! Pre-film introduction and discussion, Heerenstraattheater, Wageningen, The Netherlands 13 May 2014 Dr. Verina Ingram LEI, Wageningen UR

2 Cocoa theobroma Greek food of the gods Mexican Aztec xocolātl bitter water Cultivars Criollo Forastero Trinitario 30 pods 40 beans each 1 pod 500 beans Tree bears fruit at 4-5 years old, average age 40 years, up to 100 Tropical needs shade, warm climate abundant rainfall, nutrient rich soil 1 tree 600 flowers 1 kg chocolate

3 A tropical cash crop with colonial roots Cacao cultivation spread across the hot, humid tropical belt reversing the slave triangle

4 What's in a bean? Suggested health impacts Pleasure, craving Craving < 1 % Vitamins A, B1, B2, B3, C, E, pantothenic acid Impacts cholesterol, improve cardiovascular health, inflammation reduction, neuropsychological & cognitive functioning cerebral blood flow < 1-4 % Alkaloids Theobromine, caffeine Mild stimulant, arousal Sources: Buitrago-Lopez et al 2011, Mursu et al. 2004, Steinberg et al. 2003, Wollgast & Anklam 2000, Crozier et al. 2011

5 From bean to bar...

6 Where is cocoa produced? Exporters (Top 10) Importers (Top 10) Cote d Ivoire United States Ghana Netherlands Indonesia Germany Nigeria France Sources: UCTAD & ICCO, World Cocoa Foundation Cameroon Malaysia Ecuador United Kingdom Togo Belgium/Luxembourg Papua New Guinea Russian Federation Dominican Republic Spain Guinea Canada

7 Where is cocoa traded? Source: ICCO, The Guardian

8 g per capita domestic consumption chocolate 2010/2011 Who eats the most chocolate? th Source ICCO 2012

9 Supply chain

10 Social challenges 90% produced by 3 million small holder farmers Approx. 14 million employed Farmers high poverty levels Fair prices & incomes Position of women and workers Ensuring basic rights re child and forced labour Worker health and safety on farm Human toxicity of crop protection products Risk management and diversification Source: TSC 2013, Cocoa Barometer 2012

11 Environmental challenges Sourcing from ecologically sensitive regions On-farm use of chemicals for crop protection (pesticides) and inorganic fertilizer use Depletion soil fertility and quality on farm Biodiversity loss (full sun farms & deforestation) Maintaining genetic diversity and resilience farming systems and ecosystems Pollution water sources Packaging waste Energy use and emissions during transport and grinding, roasting and processing

12 Economic challenges Insufficient supply to meet growing global demand + declining yields Control of and losses to pests & diseases Volatile prices Efficient models to delivering services and products to farmers Impact climate change Farmer access to markets and adding value Governance and traceability in the chain Cocoa prices Cocoa prices are too low bearing in mind how much demand there is for it Edward George, Ecobank Commodities, January

13 Solutions...

14 Abidjan Declaration November 2012, World Cocoa Conference Cote d Ivoire Goal : move the entire sector to a path of sustainable development that will benefit all stakeholders along the cocoa value chain 1) Strategic management Coordinate initiatives and participate in voluntary consensual processes National Cocoa Development Plans based on Public-Private-Partnership Models (PPP) Improve living standards and working conditions - especially women and children and ILO standards 2) Sustainable production Attract younger generations Better planting material and inputs, innovative technology, integrated pest management Aid farmer s groups to offer training in Good Agricultural Practices Support Affordable and accessible credit services Manage soil fertility, preserve biodiversity and existing ecosystems 3) Chain sustainability Enhance traceability Reduce harmful impacts on the environment Training and access to market and consumer safety information Increase income by value-addition at origin 4) Sustainable consumption Respond to expectations and concerns of consumers Promote consumption in traditional/mature markets and origin/producer countries

15 Harkin-Engel Protocol (Labor agreement) September 19, 2001 Framework for growing and processing of cocoa beans and their derivative products to comply with the International Labour Organization Convention 182 on the elimination of the worst forms of child labour. Signed by industry groups: the World Cocoa Foundation and the Chocolate Manufacturers Association (now the Chocolate Council of the National Confectioners Association), Guittard, Mars, World s Finest Chocolate, Archer Daniels Midland Company, Nestlé US, Blommer Chocolate, Hershey Food Corporation and Barry Callebaut, governments in West Africa, NGOs, farmers groups and experts Progress? Dark side of Chocolate film, Bitter Harvest report, Payson Centre Tulane University, Fair Labour Association

16 March 2010 Letter of Intent: Sustainable cocoa consumed in the Netherlands The Ministry of Agriculture, Nature and Food Quality signed a letter of intent with 30 supermarkets, industry associations, companies, government agencies, NGO s and certification agencies in the cocoa sector. They committed to; Produce 100% of Chocolade letters in the Dutch market from 100% guaranteed sustainable cocoa by % of all cocoa beans used in cocoa products in the Dutch market sourced from guaranteed sustainable cocoa by % of all cocoa beans used in cocoa products in the Dutch market sourced from guaranteed sustainable cocoa by % consumption in the Netherlands sourced from guaranteed sustainable cocoa by 2025 Results out June 2014!!

17 Guaranteed certified cocoa: What does it mean? Visible, measurable, third party schemes, independent auditing and monitoring of cocoa in the chain from producer to retailer with a traceable system In 2012 approx k tons cocoa = 7% certified globally - up from 2% in 2009 however a supply deficit with synergies to upscale and to increase efficiencies in demand 405 Kt 534 Kt 165 Kt *no other such systems were found or used to provide data yet Sources: Cocoa Barometer 2011, 2012, IFC? Kt 37 Kt? Kt and other comparable systems* 1,143 Kt

18 From 2008 to 2015 Sustainable Trade Action Plan partners investing 40 million (cocoa) on enhancing sustainability of commodity chains: certification main tool Dutch government & partners investing 40 million (cocoa) from 2008 to 2015 on enhancing sustainability of commodity chains: certification major vehicle to achieve this. Recent studies highlight need for evidence on impact of sustainability initiatives especially PPP and certification. Multi-stakeholder international public + private + research + CSO partnerships emerging

19 What's needed? o Up-scaling positive initiatives o Maintaining the sustainability /certification buzz o Demonstrating to consumers initiatives having effect o Continued education and training farmers & workers e.g. GAP o Improved and accessible cultivars o Increase productivity o Access to inputs and credit o Alternative energy sources o Continued promotion of biodiversity (cultivar, farm and landscape level) o More efficient use current land & avoid abandonment of farms o Partnerships o Alternatives and innovators high value and niche markets

20 Challenges Demonstrating progress to environmental and social goals Who pays? Going beyond certification Speed of progress... Sharing pre-competitive information, complementarity not duplication Efficient use public funding Convincing private sector about efficiency of data sharing to improve monitoring, evaluation and trade data

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