The cocoa industry has been highly fragmented in its approach to moving Africa’s smallholder farmers to sustainable production. A new industry-wide initiative hopes to change that
In March some of the biggest names in the cocoa sector met in London to sign the Cocoa and Forests Initiative, an agreement designed to end deforestation in the industry’s global supply chain by 2018. Brokered by the Prince of Wales’s International Sustainability Unit, the likes of Nestle, Cargill and Mars have now committed to working with public, private and civil society partners to develop a common vision.
The statement talks of empowering smallholder farmers and their families, improving productivity and helping to finance sustainable development, but will this familiar language usher in a new roadmap for the industry?
Tropical and topical
A plant of the forest, cocoa thrives in hot, rainy, tropical conditions and is grown in a narrow belt either side of the Equator, stretching from Mexico in the west across to Papua New Guinea in the east.
In recent years, with our love of chocolate showing no sign of abating, demand for cocoa has soared. According to the World Cocoa Foundation, Africa is now responsible for nearly three-quarters of all cocoa production, with over 60% coming from just two countries, Cote d’Ivoire and Ghana.
Deforestation from cocoa, at around 3.8 million hectares a year, is much smaller than from the big four. Soy, cattle, palm oil and wood products account for around 40% of all deforestation globally. But cocoa farms are often in areas that are incredibly biodiverse and have already been devastated by decades of largely unchecked felling.
Between 1988 and 2007, for instance, the Guinean Rainforest in West Africa lost 2.3 million hectares of forest to cocoa cultivation, while the Global Canopy Programme estimates that if Cote d’Ivoire carries on at its current rate of deforestation (estimated at around 2.7%) it will lose its entire forest cover by 2034.
According to Nicolas Petit, a senior green commodities advisor at the United Nations Development Programme, this growing demand, along with increased consumer interest and NGOs keen to apply the lessons learnt from tackling deforestation in other commodities, has put cocoa and deforestation firmly under the spotlight.
One of the main problems is the way in which cocoa is farmed. While crops such as soy and palm oil are largely grown on big plantations, making them, theoretically at least, easier to monitor, around 90% of cocoa is grown on smallholdings, involving between five to six millions farmers worldwide. This makes effective, industry-wide initiatives difficult to implement.
“Although most of the deforestation is coming at a smallholder level, they don’t have the capacity to address the issue, so really the action needs to be taken by governments, NGOs and companies,” says Petit.
Christian Mensah, the Rainforest Alliance’s senior manager for West Africa, agrees. “Smallholders cause deforestation because they are poor, they do not have resources to invest in rejuvenating and replanting their existing stock,” he says. “You actually have to work with all kinds of stakeholders … to find different ways of persuading smallholders to protect the forests that are left.”
To thrive, young cocoa trees need shade, so clear-felling large areas of virgin forest to plant new ones is ultimately counter-productive. Deforestation is, of course, also a major driver of climate change. This is already being felt in Africa, with droughts and reduced rainfall leading to smaller cocoa beans, lower yields and ultimately less income for the farmers.
Over the years, a mind-boggling array of projects and initiatives has been developed to try and make cocoa farming more sustainable, and incentivise farmers not to take an axe to the remaining pockets of forest.
On the one hand there are voluntary certification schemes, which rubber-stamp the sustainable credentials of the cocoa that traders and manufacturers buy. According to research by the World Bank, the three major certification standards, run by the Rainforest Alliance, Fairtrade and sustainable farming organisation UTZ, cover 42% of cocoa pods produced annually. But while all include deforestation-related requirements, there is no industry standard or set of measures to define what deforestation actually means.
“Certification has a lot of benefits and a lot of shortcomings,” says Petit. “It’s one of the ways to address sustainability but it’s certainly not the only way.”
“Each of the schemes has its strengths and weaknesses,” he continues. “Some certifying companies are stronger on one aspect than another – Fairtrade are going to do more on the social side; the Rainforest Alliance are going to do more on the environmental side,” he said before conceding that: “All these initiatives and sustainability standards are creating confusion.”
There is some clarity, with UTZ set to merge with the Rainforest Alliance later this year, helping to cut down on duplication and administration costs. Petit is also hopeful that cocoa will follow palm oil’s lead in the EU and move to one single certification scheme.
Alongside certification, major companies also run their own sustainability strategies, such as Nestlé’s Cocoa Plan, Olam’s Livelihood Charter and Mondelez’s Cocoa Life programme. Many fall under the remit of Cocoa Action, an umbrella programme run by the WCF, although it has only recently started to look at the issue of deforestation, having previously focused on addressing productivity and child labour.
Businesses are also making public commitment to cut deforestation. Nestlé, for example, has pledged that by 2020 none of its products will be associated with deforestation, while Ferrero says that it will use voluntary standards to make sure 100% of its cocoa comes from sustainable sources by 2020.
Petit believes these pledges are a step in the right direction because they are very public and “there are a number of civil society actors that are checking how those commitments are then implemented”.
Christopher Stewart, head of corporate responsibility and sustainability at agri-business Olam, says that deforestation is “a big focus for our customers, many of which have signed no-deforestation pledges” and that it’s up to producers and traders “to make sure that we supply them with the product that they want.”
However, the suggestion is that this demand for sustainably grown cocoa needs to come from manufacturers first, and isn’t something that industry will naturally seek to implement. And amid all the good intentions, there’s still talk of a lack resources, which seems strange coming from an industry that includes some of the world’s most profitable agri-businesses. Given the importance of a flourishing forest to cocoa production, it’s very much an act of enlightened self-interest.
Mondelez’s Cocoa Life sets out to tackle several of cocoa’s many challenges at the same, explains the programme’s head, Cathy Pieters. Alongside technical support around fertilisers and pesticides, it also teaches farmers how to grow more cocoa on less space, leaving land free for other crops and reforestation.
Cocoa Life also works to develop alternative income-generating activities so that communities aren’t just dependent on cocoa, and is piloting a scheme to support farmers through the whole process of replanting, including arranging external financial support.
Mondelez has also signed a memorandum of understanding with the Ivorian government to start mapping cocoa farms so that they can identify areas that are most at risk of deforestation.
In Ghana, Olam has collaborated with the Rainforest Alliance to build more resilience into the cocoa supply network, helping to give local communities more control over their forest resources. They have also adopted a “landscape approach” that looks beyond the farm gate and addresses risk in the whole cocoa supply chain.
“Farmers are now beginning to understand the forest’s importance, not only as a means of food security and income but also the way it enables the crop to actually survive in the face of climate change,” says Mensah.
A leap of faith
Cocoa trees are productive for around 30 years, after which yields can drop dramatically. Until now, the solution for many farmers has been to clear new land to make room for new cocoa plants. But now farmers are being encouraged to grub up their old trees instead, and replace them with new ones on the same land. But it’s a way of working that takes a leap of faith by the smallholder as it leads to a substantially reduced income until the new trees crop.
The Rainforest Alliance is looking at various models to help them make this transition, explains Mensah. One involves dividing the average 2.5 ha plot into fifths, which can then be replanted rotationally over the following five years. By the time the whole farm has been completed, the first two plots will be producing cocoa.
But the real beauty of the model is that in order to give the young cocoa trees the shade they need, farmers are encouraged to plant quick-growing plantains and bananas in between them, which also double as a food crop for the family.
The RA is now developing a business case for the model, which will give the financial sector the confidence to invest in these smallholders and help fund the transition of their farms.
Yet, much like the pockets of trees the industry is trying to save, the whole approach to deforestation feels somewhat fragmented. “We need an industry-wide acceptance of the challenges,” says Mensah. “The industry should come together and have a common vision, a common strategy, a common action … rather than having scattered programmes all over the sector.”
The Cocoa and Forests Initiative could be the answer. With cocoa’s role in deforestation set to be a major discussion point at November’s COP23, the meeting is an opportunity for the industry to present its roadmap. Since it was launched, 33 of the sector’s biggest players have signed up and there have also been solid commitments from the governments of both Cote d’Ivoire and Ghana, something Pieters describes as “crucial”.
In the past there has often been a conflict of interest, with governments set on meeting the demand for cocoa, and maintaining strong foreign earnings, while NGOs have campaigned to stop the expansion of cocoa into virgin forest. Now there could be common ground.
“It’s a statement of intent,” says Petit, optimistically. “It shows that everybody is coming together. There needs to be a step-change by all involved to accepting that farming coca sustainably is the best way to produce high yields, not cutting down more trees.”
But he’s not getting carried away and says questions still exist around money, defining which activities will have the biggest impact, and the level of input from governments, who he believes need to find the resources to put in place an enabling environment, with regulation, legislation and enforcement that stops deforestation. “Private companies cannot be expected to do everything.”
This article is part of a series of articles on deforestation in supply chains. See also:
Beef supply chain blamed as deforestation climbs in Brazil
Pressure grows for expansion of Amazon soy moratorium
This is now a critical issue in supply chains'
Sustainable solution sought for palm oil in new frontier of Africa