2012
Cocoa Barometer
Cocoa Barometer 2012

Cocoa supply chain2

Confectionary industry

Smallholder

TraderGrinder

Retailer

Food
Industry

Cocoa beans

Cocoa liquor

ConsumerIndustrial
Artisanal
Pharma & tobacco
consumers

Cocoa powder or liquor or butter

Chocolate productsContent

Scope and limitations

1 Introduction page 3

The Cocoa Barometer 2012 is an endeavour to

2. Challenges page 6

stimulate and enable stakeholders to communicate

3. Certified Cocoa Production page 8

and discuss critical issues. This Barometer aims

4. Sector Developments page 12

to provide an overview of current sustainability

5. Beyond Productivity page 19

developments in the cocoa sector. The authors

6. Recommendations page 24

have chosen to focus on West Africa’s cocoa
sector, due to its dominance in cocoa production
and the significant challenges facing this region.
Because of the constraints of this publication andthe absence of third party evaluations, focus on
individual company projects and evaluations ofStandards Bodies is not a key element of the current
Barometer, but there are plans for these topics tobecome the core focus of the Cocoa Barometer 2013.

Cocoa Barometer 2012

1 Introduction

Visual 1 smallholders and production
3

When questioned, ninety per cent of people admit to

5½ million smallholders

love chocolate. The other ten per cent lie. It’s a good joke,
and while chocolate is a tasty snack for the consumers

14 million dependants

in the industrialised countries, more than 5.5 million
smallholders earn their livelihood by cultivating cocoa,
the most important ingredient of chocolate. Another 14
million rural workers directly depend on cocoa for theirincome.

98% of these on farms
smaller than 5 hectareWest Africa is the source of more than 90% of cocoa
consumed in Europe. Côte d’Ivoire and Ghana alone
contribute 59% of the global cocoa supply, with Indonesia,
Nigeria and Cameroon accounting for another 23%.
Smallholders and their workers harvest more than 90%of the global cocoa production. Harvesting, fermenting,and drying the beans, maintaining the farm, it’s all hard
manual labour. Most workers on cocoa farms, especiallyin West Africa, live and work under dismal conditions,well below the poverty line. Most of these have nevertasted chocolate, though their lives revolve around its key
ingredient.
In the first decades of the second half of the Twentiethcentury, cocoa was a crop that generated a decent
income for the farmers and their families. As a result of
overproduction and the liberalisation of cocoa markets,
the price for cocoa declined. At the same time, politicalinstability in many West African producer countries
worsened.
In recent years, emerging cocoa markets such as
Eastern Europe and Brazil have seen a rise in chocolate
consumption. Forecasts indicate that this trend willcontinue in the near future, although demand in Asia
Cocoa Barometer 2012

5 ha
90% of the total world wide cropVisual 2 - global production and import of cocoa
4Rest ofthe world

1,795
5,000
9 000
912,

155,000
52,00033,
3,000
1,511,000

1,025,000

696,000

Cote d’Ivoire

Ghanarest of Africa

0128,,000

544,000

198,000
rest of Asia

537,000
65,000342,0000

Consumption 2010/11 in tonnes
Production 2010/11 in tonnes

is less a driving factor than initially expected. At thepassing. Their form varies from company-specific projects,

same time, due to ageing cocoa farms and farmers, andto joint actions with other companies, cooperation witha depletion of available arable land, yields have at best

institutions financed by development assistance, andremained stable, if not declined. As a result, market

multi-stakeholder initiatives with civil society actors andexperts and the industry as a whole expect a substantial

Standards Bodies. These projects are primarily centred

shortfall between supply and demand by 2020, unlesson West Africa. Additionally, producing and consuming

action is taken. Increasing yields at farm level is seen as anations’ governments are investing in these projects, andnecessity in order to meet the increasing global demandin other efforts to increase sustainability in the cocoa

for cocoa. It could also provide producer countries with

supply chain. Some of these projects show good results,

more jobs, revenue, and export opportunities.

although coordination of learning between projects needs
to be improved, and there are questions on scalability ofIn response, there has been a significant move of cocoa

these projects.

companies, traders and chocolate manufacturers, tointroduce projects aimed primarily at increasing yields,

Two years ago, when the last Cocoa Barometer was

although other sustainability issues are addressed in

written, one tonne of cocoa cost more than $3.100 on

Cocoa Barometer 20125

the world market. However, the cocoa market is volatile.

It is argued that yield increase will naturally lead to

During the 2010-2011 harvest season yields reached a

improved income for farmers. This increased income

new record level, and prices went up to more than $3.700,

will then lead to an improvement of working conditions,due to the political crisis in the Côte d’Ivoire, before they

including reduction of (worst forms of) child labour andwent down to around $2000 at the end of the year 2011.

alleviation of other social issues. However, recent reports

Preliminary figures on the harvest season of 2012/2013

suggest that yield increase alone will not be able to solve

show that there is at best a marginal supply deficit, due

the issues faced by smallholders. The debate about a living

to a good harvest, which will likely lead to continued low

income for farmers and their families, a diversification

prices for the near future.

of income, access to finance, access to agricultural
inputs, a focus on the social and environmental issues,

In many countries the farm gate price for cocoa growers

financial transparency along the supply chain, as wellis much lower than the world market price. Smallholders

as an investment in local infrastructure, are all essential

generally do not have a strong bargaining position. As aingredients of a holistic approach towards a sustainable

result, many farmers cannot invest in their smallholder

supply chain. It is necessary for the sustainability debate

farms, and young people are leaving cocoa, resulting inin cocoa to go “Beyond Productivity”, the specific focus ofan aged cocoa-tree population, with the average age ofthis Cocoa Barometer.

farmers worryingly high.

1970

1002

1418

1980

1960

1990

2000

2011

2020

Visual 3 - World market for cocoa in 1.000 tonnes

3065
2331

1558
Cocoa Barometer 2012

3941

5000

2 Challenges

Visual 4 Income increase needed toescape from poverty and absolute poverty
6

213 %Poverty
Absolute
2000
poverty

967 %

6000
Poverty

341 %
3650

1608 %
5840

3650

Absolute
poverty

2281
1070
342

Current
incomeIncrease toabsolute
poverty line

Increase topoverty line

Current
incomeIncrease
to absolute
poverty line

Increase topoverty line

Ghana

Cote d’ivoire

The global cocoa industry is in crisis, and ‘business as

poor-nutrition and limited social/economic infrastructure inusual’ is not going to be able to solve it. Many issues

cocoa communities. Besides the obvious human and labourdemand attention if cocoa is to have a future, particularly

rights aspects, media attention and consumer awarenessin West Africa.

about working conditions – specifically trafficking and (theworst forms of) child labour – pose a constant threat to

Absolute poverty

brand reputation for the chocolate companies.

Income of farmers and workers must increase drasticallyfrom its current levels. The average income of West African

Decline of farmer populationcocoa farmers and their dependents is far below the level

The average age of cocoa farmers in West Africa is aroundof absolute poverty. Insufficient income to pay workers,

50 years. With life expectancy around 60, the current

coupled with a shortage of workers in rural areas, forces

generation of cocoa farmers will soon start passing away.

farmers to rely on unpaid workers. Many of these are

Poverty and dismal working conditions have caused

family-members, and often work excessive hours, directly

farmers to no longer believe in a good future in cocoa

increasing the risk of (worst forms of) child labour andfor their children and grandchildren. Children want go toforced adult labour (FLA 2012: 28-29).

school, not to become better farmers, but in the hope offinding employment outside the cocoa sector. As a result,

Poor working conditions

a severe shortage of cocoa farmers is a realistic scenario

Working conditions on cocoa farms remain very poor.

within the coming years. At the same time, demand forFarmers are exposed hazardous work, non-mechanised

cocoa is expected to rise by 1 million tonnes in the next

production systmes, gender and ethnical discrimination,

decade - a quarter of the current world production.1

Cocoa Barometer 2012

Critical issues
Economical issues> Income for farmers (living income, diversification of crops,
rising cost of living, price volatility and speculation)> Access to markets (credit, market information,
investment risks)> Farming practices (farmer training, low yields)> Infrastructure (streets, hospitals, schools,
roads, high taxes, transport costs)

Social issues> Human rights violations (child labour,
forced labour, trafficking, undernourished children)> Working conditions (use of pesticides and fertilisers, polluted water, hours
of work, harassment or abuse, discrimination, gender inequality)> Land tenure> Illiteracy and education> Freedom of association, collective bargaining, and farmer organisation

Environmental issues

7> Ageing farmer communities> Power relations (corruption, tax evasion through trade mispricing,
political instability, smallholder famers versus multinational companies)> Ageing & diseased cocoa trees> Low quality of cocoa beans & monoculture> Deforestation, decreasing biodiversity & soil degradation> Climate change> Environmental impact of use and sourcing of fertilisers and pesticides

1This growth in demand comesprimarily from countries in Eastern
Europe, such as Russia and Poland,
as well as Brazil. Historically one of
the major cocoa exporting nations,
Brazil now consumes almost as
much cocoa as it produces, and has
de facto ceased to be a major cocoa
exporting nation. Consumptionof chocolate in India and China is
not increasing as strongly as somehave previously predicted. Evenin the case of a strong growth of
consumption, it will take many years
for them to become an important
global export market.

Visual 5 Potential decline in workforce 2012 - 2030
2012

current production2030
atdoubled yield
451.000

potential
demandshortage

225.500

at current yieldcurrent
workforce

154.000
Cocoa Barometer 2012potential
workforce3 Certified Cocoa Production

8

The past years have seen a significant rise in certified

chain, including farmers. Standards Bodies advise farmers

cocoa production. There are various reasons foron how to implement better farming practices, establish

companies to move to certified supply chains; supply

protocols on dealing with environmental and social

security, demand from consumers, improvement of brandissues, implement auditing and third party verification on

reputation, credibility of claims, transparency of (a partthese issues, and communicate to consumers at the endof) the supply chain, cost reduction in sustainabilityof the trade chains, thereby creating a necessary level ofprocesses, and efficiency, to name a few.

assurance.

These developments have led to a healthy competition
between the major Standards Bodies. Production of

Certified cocoa commitmentsof major chocolate manufacturers

certified cocoa increased fourfold between 2009 and 2011.

Cadbury was the first major chocolate company to start

An impressive growth, even if approximately one third ofusing certified cocoa, for their Dairy Milk chocolate

this amount is inflated because of double or even triple

in 2008. Then, in 2009, Mars was the first major global

certification. Additionally, production of certified cocoa

chocolate company to commit to use 100% certified cocoa

beans was significantly higher than the sale of certified

for their entire range by 2020. They are following this up

cocoa, with more than a third of the produce eventuallywith regular public disclosure on progress. Ferrero will

not sold as certified.

source 100% of their cocoa ‘sustainably’ by 2020, and havereleased a timeline, but does not specify comprehensively

As a result, there is confusion regarding the amount ofwhat level of assurance the sustainability will beavailable certified cocoa. Some companies claim that theymeasured to. Nestlé does not name a specific date whencannot increase purchases of certified cocoa due to a lackall their cocoa will be compliant to renowned standards,of supply. Standards Bodies and farmers, on the otheralthough in certain countries and on certain sub-brands

hand, indicate that production of certified cocoa is far

they have now committed to 100% certified sourcing,higher than demand. Although there are valid potential

communicating future targets only at regional level. Theirreasons for this overshoot, the current significant

recent response to a Fair Labor Association report on

differences warrant further research on this gap inchild labour in their supply chain is robust. However, it

claimed supply and claimed demand.

deals mainly with the cocoa sourced through their own
Cocoa Plan, with the vast majority of their supply being

FLO, Rainforest Alliance,
Organic, and UTZ Certified

unaffected by these plans. Recently, Hershey has made a

The four internationally accepted Standards Bodies

is no transparency at the time of publication as to how

are Fairtrade Labelling Organizations International,

they will back up this commitment. They have declined

Rainforest Alliance, Organic, and UTZ Certified. These

repeated invitations by the authors of this Barometerstandards are defined after consultation and in close

to provide information on their future plans. Mondelezcooperation with various stakeholders in the cocoa supply(formerly Kraft Foods) are the world’s largest chocolate

commitment to 100% certification by 2020, although there

Cocoa Barometer 2012

Visual 8 - Fate of certified cocoa in 2011

9company since acquiring Cadbury in 2010 – at the time aon this model. Current evaluations and impact studies

company leading the way in FLO-certification. Since thatwould do well to incorporate these previous suggestions.

time, Mondelez have made no new movements towards
certification, although this can be partly attributed to a

The outcome of these evaluations and pending changes isstring of internal reorganisations. These have also led tofertile ground for future research.

an expected delay in delivering on their commitment tofully certify their Marabou and Côte d’Or ranges by theend of 2012.

Retailers
Many European retailers are actively promoting
sustainable cocoa, and are sourcing more and moresustainable cocoa for their own brands. Most of these aremajor players, such as Ahold (Netherlands), Rewe and Lidl
(Germany), Sainsbury’s (Great Britain), Carrefour (France),
and Coop (Switzerland). This adds to the pressure on otherretailers, but also on traditional chocolate producers
with well-known brands. If retailers can source cocoafrom sustainable sources, even down to the lower pricesegments, the more expensive brand names should surely
be able to do the same.

Evaluation of Standards Bodies
Although it is generally accepted that Standards
Bodies provide an improvement in economic and living
conditions at producer level, there are few independent
evaluations on the outcomes and impact of the Standards
within cocoa. However, evaluations for Rainforest
Alliance, Fairtrade and UTZ Certified are expected to
published in the near future. Besides impact evaluations,a second important tool in evaluating the actual
operations (but not the outcomes and impact) of
Standards Bodies is the “Continuous Improvement
Model”.2 The previous Cocoa Barometer gave various
suggestions for improvement to Standards Bodies, based2

For a description of this model see TCC Cocoa Barometer 2010.

Cocoa Barometer 2012

10

Visual 6 Production and growth projectionsof certified cocoa by Standards Bodies
2009

2011

2015

+ part soldas certified

also shown
prognosis madein 2009 for 2015

Visual 8 Traders & Grinders

2020

2011

50.0008%600.000 T

11%62.000560.000 T

65 Kt

13 Kt

98 Kt

450 Kt

900 Kt

43 Kt

10%
5 Kt

214 Kt

400 Kt53.000537.811 T

800 Kt45.000

10%

46 Kt

Total

65 Kt

162 Kt265 Kt535 Kt84 Kt

474 Kt1,115 Kt

2,235 Kt

Visual 7 Fate of certified cocoa in 20111%
10%450.000 T

5.000
400.000 T

26.000252.000 T

100% certified production
finds other sales channels
is sold as certified

33%

37%

30%

or is of inferior quality

is double certified

Cocoa Barometer 2012

12%
15%

29.000235.000 T

29.500200.000 T

Visual 8 Chocolate Manufacturers
11

2015

2011

2015

2020

8%
25%

11%

%?

8%
450.000 / 35.000

1%

23%

%?

8%

46%

100%

1%

%?

400.000 / 5.500%?

8%390.000 / 30.000
?

%?

%?

%?

100%

?%
200.000 / ?

25%

3%

3%
120.000 / 3.500

35%

19%

%?

Cocoa Barometer 2012

40%

100%

4 Sector Developments

12

So many sustainability initiatives have been started in

a common training manual for sustainable cocoa

cocoa in recent years that governments, companies,

production for trainers, training guides for small

or civil society actors not involved in at least one or

producers and a guide for an internal management

two programmes are hard to find. This is a positive

system. It is based on existing experiences that can be

development, which needs to be matched by public

used by all Standards Bodies. Material is adapted totransparency of these initiatives; on activities, moneys

national needs, for example in legal definitions of (worst

spent, and most importantly on impact.

forms of) child labour or in reference to support structuresoffered by governments.

Additional to these individual programmes, a sector-wide
and pre-competitive approach to the issues is necessary.

Though its initial phase is now in the winding-downThough some interesting steps are being taken in thisstages, it is expected that the majority of progress maderegard (the Certification Capacity Enhancement andwithin the CCE project will be picked up within the newEuropean Committee for Standardisation programmes,

German ‘Forum Nachhaltiger Kakao’. CCE is an important

the work of organisations such as the International Cocoa

step in cooperation of the three major Standards Bodies.

Initiative and World Cocoa Foundation, as well as theNonetheless, there is ample room for closer cooperation,

possible outcomes of the World Cocoa Conference), at

specifically at the level of farmer training and auditing,present a true sector-wide approach to the economical,

ensuring better access to standards and certification for

ecological and social crises in the global cocoa production

farmers at lower costs to the producers.

still needs to take significant shape.

European Committee for Standardisation (CEN)
Developments in certification

A second recent development comes from the European

Although standards and certification are essential tools

Committee for Standardization (CEN), which plans toin the development of sustainable cocoa productions, its

develop a standard around “the sustainability andbenefits are not always clear to companies, producers,

traceability of cocoa.” Some actors hope, through theand consumers. Costs and complexity, unverified impact,

CEN process, to develop a common European standard

and overlap of standards, all contribute to this. (ISEAL Alliancefor cocoa that could be a valid baseline for their

2011: 15) Two industry-wide initiatives to tackle some ofsustainability projects. Others, including some non-these concerns have recently been launched, the CCE andgovernmental organisations, government representatives,

CEN processes.

and some companies, are worried that the process mightlead to a lowest common denominator standard, which

Certification Capacity Enhancement (CCE)might result in a reduction of the gains made in the past

The CCE project is a recent initiative to improve farmer

decades.

access to standards and certification, and is supported
by a broad range of private sector companies, standards

There are concerns surrounding the inclusion of

bodies, and development organisations. CCE developed

stakeholders in the CEN process. Southern civil society

Cocoa Barometer 2012

13

is under-represented at the time of publication of thisyear the 7th ICCA came into force), aimed at creating a

document. In most European countries there is also an

sustainable world cocoa market. Though the ICCO plays anunder-representation of civil society, due amongst otherimportant role, especially in research as well as dialogue

reasons to high participation fees.

between consuming and producing nations, it is currently
an exclusive government-level organisation in which

Within the CEN standard, it will be important to havefarmers, traders, unions, non-governmental organisations

a high bar, but with a low entry threshold for farmers.

and consumers are not represented, and at which

Through a stepped approach, they could then be ableindustry has a consultative role. Though the new ICCA

to achieve the high outcomes that the current process

indicates indicates an increased possible participation forenvisions. If this line will be held, it could create a system

stakeholders, increased stakeholder participation is anthat allows all farmers to be included, whilst at theissue that can and should be addressed.

same time ensuring a common and high standard forsustainable cocoa production.

The Roundtable for a Sustainable Cocoa Economy (RSCE)
was a multi-stakeholder process set up to foster dialogue

Developments in producing countries

about sustainability in the cocoa economy. Two major

As recently as the 1970’s, being a cocoa farmer in Westconferences were held, in 2007 in Ghana and in 2009

Africa was a desired profession, and cocoa farming couldin Trinidad & Tobago. A Roadmap with key elements

provide sufficiently for the farmer and his/her family.

towards a sustainable cocoa economy was agreed on,

Then, in the 1980’s, under pressure from the IMF and theaddressing the most urgent issues in the cocoa supply

World Bank, the state-owned marketing boards werechain. However, some producing nations objected todismantled, with the exception of Ghana’s Cocobod. Since

the outcomes of specifically the Trinidad conference,

then, West Africa’s cocoa farmers have been increasingly

which has stalled the operation of the RSCE. The RSCE-

vulnerable to price volatility, and have often received only

process has provided a platform for dialogue on thea small share of the world market price, while bureaucrats,

need for global and national efforts to explicitly promote

and influential traders got rich, and the price for cocoa

sustainable cocoa supply chains.

declined. Recently, Côte d’Ivoire has re-established amarketing-board, the Conseil du Café-Cacao (CCC), andPartly as a continuation of the RSCE, the ICCO is organising

Nigeria, Cameroon and Indonesia are all working on plans

the World Cocoa Conference (WCC), which will be held in

to increase the cocoa exports, but without apparent plans

Côte d’Ivoire in late 2012. Hoping to bring together actors

to re-establish marketing boards.

from all stakeholder groups, this conference could givenecessary alignment to the future of sustainable cocoa

In the meantime, the International Cocoa Organisation

The WCC might be a useful starting point for launching(ICCO) – the international body of cocoa exporting andsector-wide approaches to dealing with some of theimporting countries – has been steadily working away

core issues at hand, provided relevant stakeholders areon a progression of International Cocoa Agreements (thissufficiently able to engage in the process.

Cocoa Barometer 2012

14

Civil society in West Africa is increasingly starting to

subsidised fertilisers. A useful role for the Cocobod in thecome together, with the formation of the African Cocoa

coming years could be to support diversification of farmer

Coalition, a broad West African cooperation of civil

income.

society, and with the formation of various networks offarmer groups and trade unions, many of which were

Côte d’Ivoire: Conseil du Café-Cacao (CCC)

established with assistance from European civil society.

This year, Côte d’Ivoire has initiated the rebuilding of aplatform to regulate the cocoa market, the Conseil duElsewhere, significant investments in Asia are seeing a

Café-Cacao (CCC), whose predecessor was disbanded 20

rise of cocoa production in countries such as Indonesia,

years ago.

Vietnam and India, although it will still be a long time
before these regions will be producing the quantities

The CCC aims to improve yield and quality, and plans are

currently coming from West Africa.

being made to implement transparent and reliable trade
structures, as well as to strengthen cooperatives and the

Ghana: Cocobod

cooperation of the different players along the cocoa value

Being the only country not to disband their marketing

chain. Additionally the CCC guarantees farmers 60% ofboard, Ghana’s state-run marketing board Cocobod, has

the world market price for their cocoa. In order to achieve

provided a level of protection to farmers from the worst

this, a similar system to Ghana’s is being worked on,

impacts of liberalisation of the cocoa market. Farmers andselling future production via auctions before harvest.

multinational cocoa companies accept the Cocobod, andoperate relatively well within its framework. However,

The tense political situation in the country, combined

they could be benefitted by a reduction of inefficiencies

with the pending problem of land conflicts, and the fact

and bureaucracy within its systems.

that the margin of 60% might not be sufficient to stop
cocoa being smuggled. It remains to be seen whether

Being the only institution authorised to export cocoa fromsuch fundamental changes can be enforced in such aGhana, Cocobod sells up to 70% of expected cocoa yields

short period of time, with the tense political situation into traders and on the commodity futures market prior tothe country, combined with the pending problem of land

the harvest. As a result, it guarantees a minimum price of

conflicts, and the fact that the margin of 60% might not

70% of the world market price at the start of the harvest

be sufficient to stop cocoa being smuggled. However, theseason, providing at least a partial protection against

establishment of the CCC can be seen as a positive step involatility of world market prices.

the restructuring of the world’s largest cocoa producing
nation after a decade of turmoil.

Cocobod is also responsible for quality checks at thecocoa collection points, and supervises the buyers. It
has its own research institutions, coordinates spraying
activities, and is responsible for the distribution of
Cocoa Barometer 2012

15

Developments in consuming countries

the Dutch cocoa sector (industry, government and civil

Over the last decade, consumer awareness of issues

society) to ensure that 100% of cocoa consumption in thesurrounding sustainable cocoa production has increased.

Netherlands would be certified by 2025, with intermediate

Fuelled by countless campaigns, particularly focused ontargets of 50% by 2015 and 80% by 2020. The monitoring ofchild labour and trafficking, media and public awarenessprogress on this declaration is being set-up at the time of

now is a major driving force behind the move to standards

writing, and initial results should be available soon. At theand certification within the chocolate industry.

same time, the ‘Choco Workgroup’ has provided a platform
for all stakeholders - including small and medium sized

However, the argument has been made that ten years

enterprises – to engage in dialogue on a sustainable cocoa

of voluntary self-regulation has shown a failure to end

production.

labour abuses in the supply chain. Some say that now is
the time for consuming nations to step up their role as

Sadly, the Tropical Commodity Coalition (TCC), one ofoversight bodies. At the same time, a public focus is also

the strongest forces within sustainable cocoa in theneeded on the root causes of social wrongs in the cocoa

Netherlands, ended operations at the beginning of 2012.

supply chain, and a re-emphasis on some of the less well-

The gap the TCC has left has been partially filled by the Voiceknown issues in cocoa.

network, as well as the work of individual former member
organisations of the TCC such as Oxfam Novib, Hivos and

An increased cooperation between civil society has

Solidaridad.

created a stronger globally accepted agenda forsustainable cocoa, and also serves to strengthen inter-

Germany

stakeholder dialogue. As a consequence of the RSCE,

The “Forum Nachthaltiger Kakao” (Sustainable Cocoa Forum)

several countries are starting to implement national

was launched in Germany in June 2012 as a multi-stakehold-Roundtables on sustainable cocoa, aiming to increase theer process of all major participants in the German value

sustainability of nationally consumed cocoa.

chain from civil society, industry, unions and Government
ministries. Its aims are to promote sustainable cocoa farm-

The Netherlands

ing and improve living conditions of the farmers, as wellThrough constructive multi-stakeholder dialogue, manyas to accelerate and improve existing initiated processes.

steps are being taken, and in many ways, the Dutch

Provided there is good stakeholder inclusion and that ambi-

government have had a leading role in the move towards atious goals concerning the identification and the scale up ofsustainable cocoa supply chain. The Netherlands also havebest practise projects are set, this large cocoa market could

been proactive on an international level, for example inplay a vital role in the transition to a sustainable cocoa

the RSCE’s, within the ICCO and in the current CEN process.

economy. Although there are discussions about the Forumsetting up sustainable consumption targets, there is a dan-In 2010 a declaration of intent on sustainable cocoa

ger that setting targets that are less than ambitious would

consumption was signed. This declaration committed

reduce the sustainability debate, rather than enhance it.

Cocoa Barometer 2012

16

Belgium

swiftly ratify and implement ILO core-conventions 138 (onA panel on a sustainable cocoa value chain was organised

child labour) and 182 (on the worst forms of child labourin October 2011 by Oxfam and Transparency International.

or WFCL), and foster awareness of this issue within theirDifferent stakeholders attended the panel and opened theown countries.

dialogue on challenges and chances to work towards a
Belgian sustainable cocoa chain.

The resolution denounces the breaches of humanAt present, there are discussions among stakeholders

rights, points out the seriousness of the issue in the

towards setting up a Belgian roundtable on sustainablecocoa sector and calls for concrete action. However,cocoa. Harbouring the second biggest cocoa import port

there are still urgent actions underexposed in thein Europe, world’s biggest processing factory, a flourishing

resolution. The proposed actions are mainly targeting

sector of fine Belgian chocolates, and a Belgian Chocolate

states. Nevertheless, it is necessary that, at the European

Code, it is time for improvement of sustainability of theCommission and Parliament level, legally binding

Belgian market. There is a crucial role for the federal

measures are also outlined for other stakeholders in thegovernment to take in the process.

supply chain

Switzerland

Australia & New Zealand

Unlike many of Switzerland’s European counterparts,

The Australian Government has so far resisted

there is a lack of a coordinated and comprehensive

campaigns from civil society groups to take any active

approach to sustainable cocoa. The State Secretariat

role in addressing forced labour and child labour in thefor Economic Affairs (SECO) and the Swiss Agency for

production of cocoa imported into Australia. However,Development and Cooperation (SCD), provide support

in 2011 the Department of Foreign Affairs and Tradefor projects in Indonesia and Ghana, in cooperation withconfirmed at a Parliamentary hearing that World

Swiss companies and development NGOs, and there

Trade Organisation rules would not prevent consumer

is activity in civil society. However, it is surprising thatgovernments from being able to take such action. There

Switzerland, which houses two of the world’s largest

has been no roundtable of chocolate companies inchocolate companies, is not taking a more active role,

Australia. Thus, action in Australia has been a series ofboth on a national and on a global level.

community campaigns targeting individual brands. These
campaigns have had some success.

EU
When the European Union ratified the new International

USA

Cocoa Agreement in the spring of 2012, the parliamentary

In 2001 the United States threatened to ban the import

Committee on International Trade (INTA) decided to add aof cocoa from regions where the worst forms of childresolution on (the worst forms of) child labour, since theselabour are widespread. Under pressure from the chocolate

points were hardly mentioned in the ICCA. This resolution

industry, the legislation ended up as the voluntary Harkin-urges all cocoa producing states that have not done so toEngel Protocol. In this Protocol, the chocolate industry

Cocoa Barometer 201217agreed to abolish the worst forms of child labour by 2005,

Most of these programmes report on the amountalthough this deadline has been extended several times,of farmers trained, however, few, if any, have beenin the last instance to 2020. It has become obvious thatindependently evaluated on impact, or work with third-

the initial attempts of the industry to join forces and push

party verification. In order to be able to measure thethrough changes have failed.

merit of these programs, further research is needed.
The next Cocoa Barometer will specifically look at

In 2010, the chocolate industry, together with government

these programmes, and the authors of this document

officials of the United States, Côte d’Ivoire and Ghana,strongly urge the private initiatives to have independentissued a Joint Declaration and a Framework of Actions

evaluations publically available by the middle of 2013.

to implement the Harkin-Engel Protocol. The new target
now is to reduce worst forms of child labour 70% by 2020,

Besides the company-owned projects, there is also a

although a benchmark by which this reduction can bevariety of industry-wide initiatives which focus on ameasured has not been agreed on.

sustainable cocoa production, including the International
Cocoa Initiative, the World Cocoa Foundation, and theThough turn-of-century legislative processes initiated theDutch Sustainable Trade Initiative.

global dialogue on sustainable cocoa, specifically on childlabour-related issues, and though the USA is the world’s

International Cocoa Initiative (ICI)

single largest consumer of cocoa, it is disappointing that

The ICI was founded in response to the Harkin-Engelat present the government has become largely inactive

protocol, to create an answer to eliminating Worst

on the issue, leaving the brunt of the work to civil society

Forms of Child Labour (WFCL), child labour and Forced

organisations in the United States.

Adult Labour (FAL). The main thrust of their work has
been community-level sensitization, mobilization andIndustry initiatives

community-driven action to eliminate WFCL. From an

Various industry-led initiatives on sustainability haveinitial scope of targeting the entire cocoa sector in Côte

been launched in the past few years. Industry investments

d’Ivoire and Ghana, its ambitions and goals have been

aim to identify farmers, improve farming methods, andslowly readjusted to be a clearinghouse of best practices,increase yield across the board. This in turn is expected toand to be an advocate for best practices to be adopted bylead to an increase in livelihoods for the farmers, thereby

relevant actors within cocoa producing communities.

increasing sustainability in the long term. Examples ofthese industry-led initiatives include Armajaro’s “Source

Recently the ICI has found a new impulse, coming

Trust”, Barry Callebaut’s “Partenaire de Qualité” (QPP),

alongside chocolate manufacturers and local authorities

Nestlé’s “Cocoa Plan”, and Mars’ “iMPACT” and “Vision forto jointly tackle the child labour issues within their supply

change” programmes.

chains. An increase of participation of stakeholders,
particularly civil society actors, is much needed. Clear
communication of goals and ambitions, coupled with a
Cocoa Barometer 2012

18

holistic agenda for the sector, would strengthen its work.

Dutch Sustainable Trade Initiative (IDH)

In that light, it is a good step that the ICI have held their

IDH has been one of the major catalysts towards

first external stakeholder meeting in November 2012.

mainstreaming sustainable cocoa through its support

Funding and support from various stakeholders continue

for UTZ Certified cocoa. Providing fund-matching for

to be necessary for the ICI to deliver and increase concrete

participating companies, its scope of operations has been

results on the ground in reducing (worst forms of) childincreasing throughout West African cocoa for the pastlabour in West African cocoa.

years. Like many other current sustainability projects,
its focus is on increasing yield and improving farming

World Cocoa Foundation (WCF)

practices, with primarily social indicators absent in

The WCF is a global industry-based foundation, with more

reporting and objectives.

than 90 member companies, representing 80% of the
global cocoa and chocolate market. Its main goal is to

Its initial goal of having a broad variety of industry

promote sustainable cocoa by financing and organising apartners actively participating in the project seems tobroad range of programs to support the farmers.

have been reached, although it has primarily attracted
cooperation of multinational corporations, with only a

Its Cocoa Livelihoods Program aims to improve thefew small and medium enterprises involved.

functioning of farmers organisations, trains farmers ingood agricultural practices to increase productivity andPartners involved in IDH are investing millions in building

quality and supports the foundation of Farmer Businessservice infrastructure for their farmers, but at present

Schools to enhance the skills of farmers not only on cocoa

there is no systematic assessment or benchmarking to

but also to diversify produce other crops. CocoaMAP,

understand what really works, what is scalable, and how

which was launched in the fall of 2012, is a data-collection

to drive cost-efficiencies. Such assessments are necessary

tool to measure progress on sustainability in the cocoa

to fill in the knowledge gap, creating greater insights

sector, in a broad sense. Its aim is to have a constantfor the public domain but also for industry investment

flow of information with a variety of indicators on thedecision-making. Wageningen Univeristy (WUR) anddevelopments towards sustainable cocoa production.

IDH have therefore initiated a study to redefine impact
reporting on their projects. Besides that the Dutch

Many of the WCF’s projects are run in cooperation with

Ministry of Foreign Affairs is setting up an evaluation

its industry members. As such WCF plays an important

program with IDH. However, no independent publicrole in the implementation of sustainability projects inevaluations of projects and impacts have been published.

producing regions. However, public evaluation of projects
and impacts are a necessary next step.

Cocoa Barometer 2012

5 Beyond Productivity

19

There are many reasons for the poverty and poor living

falling prices at all. A notable exception is Ghana, whereconditions of cocoa farmers and their workers; lowrelative security is provided within the harvest season

income due to volatility of prices, high living costs, athrough Cocobod’s price guarantee. In Côte d’Ivoire, thelarge number of dependents per cocoa farmer, lack ofrecent founding of the CCC might be a good step towards

infrastructure (including roads, health facilities, schools,

the same direction, although it is too early to be able toand electricity), and, despite efforts in recent years, there

measure any impact. In fact, in its first year of operation,

still remains a serious lack of farmer training capacity.

the CCC already faces a major deficit due to a decrease of
the cocoa price, a risk that Ghana’s Cocobod also regularly

Though there is a wide range of projects currently aimed
at increasing sustainable cocoa production, there seems
to be little central communication and coordination ofthese projects. There is a strong competitive edge to manyof these programmes, where it would be beneficial forcollective and pre-competitive sector-wide approaches tofaces.

Visual 9 Changes in cocoa prices 1980-2012$ 5.265+$ 4.388

be implemented.
$ 3.105

All current sustainable cocoa projects focus mostly on
increasing yields, at least in practice. Though increasing$ 2.342yields is a necessity, the issues facing a sustainable cocoa$ 1.969$ 2.062

supply chain, and therefore the needed solutions, are$ 1.732$ 1.253

much broader. A wider set of tools and interventions arenecessary.

Price volatility

80/81

85/86

cocoa has doubled in the past decade, it still remains at

95/96

00/01

05/06

daily cocoa prices vary wildly, further exacerbating thesituation of farmers.

––

While the major companies are able to protect themselves
against price fluctuations through long-term supply
contracts, and by hedging transactions at the cocoa
stock exchange, farmers have no such protection against
Cocoa Barometer 2012

– $ 2.160–– $ 3.296 – $ 3.203

Price adjusted for inflation.

Oct 11/Mar 12– $ 877

merely half the level of 1980. Not only are the prices low,

3

10/11

–

Between 1980 and 2000, the price for a tonne of cocoa
decreased from $5.265 to $1.253.3 Although the price of

90/91

–
– $ 4.012–– $ 3.533–– $ 2.923

Visual 10 Volatility of market prices
20

+843
+ 748
+ 715

the sustainability projects are not present in remoteareas because of a lack of transportation, roads, andaccommodation (FLA 2012: 24).

+493

A 2008 report issued by the Bill & Melinda Gates
Foundation claimed that West African cocoa yields could+ 217$2.889$3.133be significantly raised, from 400 to 980 kg per hectare, by$2.887$2.581

introducing better farming practices. This would, however,also lead to a significant rise in costs. Due to subsidised
fertilisers and low taxes, these investments could be$1.998

profitable for Ghanaian farmers. In contrast, income of-385

farmers in Côte d’Ivoire would only marginally increase, due-169

to higher taxes and margins of the cocoa traders, and the-613

absence of subsidies for fertilisers (BMGF 2008: 15-16).

-625
-822
’07

’08

’09

’10

’11

But investments can also lead to losses. In a project inIndonesia, millions of seedlings were distributed, andYears’ average / highest day price / lowest day priceadvice was provided on proper of use of fertilizer, handlingof seedlings, and pest-control. However, bad weather anda cloning technique originally intended to hasten seed

Return on investment

production has lead to misshapen trees that yield small,

Yield increases do not necessarily guarantee higher

discoloured beans. Corruption, insufficient farmer training,incomes, because of higher costs. Positive results areand faults by nursery workers have now caused farmers

dependent on availability of better planting material,

to start cutting down cocoa trees to make way for oil palm

fertilisers and pesticides, as well as improved husbandry,

plantations that bring better returns (Pardomuan/Taylor 2012).

which are all costs to be taken out of the farmer’s income.
Besides these investments in their farms, farmers must

More research has to be done on the potential profitability

also increase their workload.

of yield increase, on the risks involved and how to mitigate
them, on the likelihood of investments due to lack of

In some cases, investments can clearly be beneficial, as

funding, and on best ways to make financing available.

Mars’ Sulawesi project shows; despite increased costs,
profits rose from $694 a year to $3.725 (World Agroforestry

Uncertain profits of certification

Centre 2011: 13). However, it is an open question whether

Most experts operate under the assumption that

good results in smaller pilot projects can be replicatedcertification against a standard brings financial benefits toindefinitely. In Côte d’Ivoire, for example, most of

farmers. However, at present, there are few independent
Cocoa Barometer 2012

21

evaluations on the impact of standards and certification

trees. Biodiversity throughout the cocoa belt has sufferedon cocoa farmer income, although several such studies

major blows, mainly because of cocoa. In many cocoa-

are in the pipeline. Initial findings from preliminary

producing regions, there is virtually no original forest left.

research suggest that adhering to standards throughcertification is financially profitable. However, some ofThis is not just a historic process. As recently as a few

these studies have been based on the assumptions of highyears ago, Ghana’s already small forest areas were incocoa prices.

decline by 2% a year, mostly due to cocoa (Hatloy et al. 2012: 17-18).
In Côte d’Ivoire, population increase in cocoa regions, atSome of the complexities surrounding measuring

least partially because of migration, has led to immense

the financial benefits of certification come from thepressure on land and forests. The problem is aggravatedvarying costs of certification (although initial costs

by climate change. According to recent forecasts the areas

are always high), and also the variable added income

suitable for cocoa plantations will diminish dramaticallythrough premiums (part of which may not reach farm

until 2050 (Climate Change/CIAT 2011).

level). According to a recent calculation of the situationon the cocoa market, most of the extra income comesLand tenure, as a result, has become an issue in several

from premiums, which might decline when certification

ways. Conflicts about ownership of land were one of the

becomes mainstream. (KPMG 2012: 64).

underlying reasons for the recent civil war in Côte d’Ivoire.
In addition, many migrant communities find themselves

Smallholder farmers and cooperatives seeking

unable to diversify their crops, due to land tenure laws,

certification from multiple standards – often covering a

and are caught in the poverty trap of growing cocoa. In

majority of the same issues – face high administrative andmany West African communities, additionally, land rights

handling costs. Ways need to be found to reduce these

become problematic when coupled with gender, withcosts. Tools for multiple auditing have been developed,

ownership and decision-making power often not being

and initial steps in creating joint training have beenaccessible for women, even when they are the ones doing

undertaken through the aforementioned CCE project. A

a lot of the work.

logical and useful next step would be to streamline theauditing and compliancy at farm level, with Standards

Environmental effects of yield increase

Bodies accepting each other‘s audits on those areas were

Current projects for increasing yield are dependent on aoverlap is evident.

significant increase in the use of fertilisers and pesticides.
However, seeing such an increase across the entire cocoa

Land use and tenure

growing community is not feasible, for both economic

For decades, expanding cocoa production mostly meantand environmental reasons.

clearing virgin forest to plant cocoa trees. Such practices
are not possible any more; most of the fertile land in West

If all cocoa farmers in Ghana were to use the amounts

Africa suitable for cocoa is already planted with cocoaof fertilisers and pesticides currently propagated by the

Cocoa Barometer 2012

22

various programmes, it would probably bankrupt Cocobod

One possible way to overcome this problem would be for

who subsidises their use. In Côte d’Ivoire, most farmers arebanks operating in rural areas to make credit available forsimply not capable of paying for fertilisers and pesticides.

smallholder agriculture enabling small-scale farmers to

Additionally, an extensive increase of mineral fertilisers

access credit or to save money. Such systems are included

will destroy the ecology of the North African regions

in very few of the projects led by companies. GIZ is trying

where these minerals are mined, increasing pesticide use

to set up a system with the governments of Nigeria,

will detrimentally affect the quality of local water sources,

Cameroon, Côte d‘Ivoire, Cocobod and the WCF, in close

besides the obvious health hazard of using pesticides.

cooperation with local NGOs, but there is still a long way

Organic production, combined with better farming

to go to make credits and agricultural inputs available andpractises, in pilot projects in Nigeria has lead to goodaffordable for small-scale farmers.

results; increased yields combined with a significant lower
use of pesticides and fertilizer lead to higher incomes, andLocal infrastructure

might be a way forward. (Faturoti et al. 2012: 435)

A significant improvement of local infrastructure isnecessary, including building roads and warehousing,

To this end, further research is necessary, as well as ain order for sustainability projects to be rolled out

careful approach in rolling out new projects that might

across all cocoa growing regions. Though in essence ahave negative environmental effects. Increasing yield is

responsibility of local governments, this is in the directa necessity, but all efforts should be made to ensure thisinterest of all involved in the cocoa supply chain. Overhappens with as little damage to environment as possible.

decades, the tax revenues from the cocoa trade have not
led to corresponding investments in the infrastructures

Access to credit and agricultural inputs

in the cocoa growing regions. Industry, government

The vast majority of farmers do not have sufficient accessand developmental investments in local infrastructure

to inputs and training, and when they do, they often

are sorely needed. Additionally, there is a role forcannot afford them (World Bank 2011: 47). All the predictions on

governments of consumer countries to assist producer

yield increase, through more or better inputs and thecountry governments on eliminating trade mispricing tax

implementation of better farming practices, are based

avoidance by cocoa traders.

on the assumption that the farmers are able to invest.
Farmers could end up in a poverty trap; without capital

Diversification

investments their yields cannot increase, but their current

Whereas many cocoa farmers are entirely dependent on

capital does not give them any room for investment

the cocoa prices for their survival, chocolate companies(Hainmueller/Hiscox/Tampe 2011: 3). As a result, certification could thenare much less vulnerable to fluctuations in market prices.

become unobtainable for small-scale farmers (KPMG 2012: 45).

In West Africa cocoa is primarily a monoculture crop,
while for chocolate companies the cost of cocoa is only
one factor among many. In Europe, the expenses for cocoamake up only 7% or less of the price of a bar of chocolate.

Cocoa Barometer 2012

23
(Hütz-Adams 2012: 28-29) Diversification of crops is crucial in ordernon-governmental organisations, development assistanceto improve income and living conditions in the cocoa belt.

organisations, and some companies are now starting to(e.g. BMGF 2008; KPMG 2011; FLA 2012)

advise farmers how to diversify production. This could
improve the farmers’ livelihoods and encourage them

A move away from monoculture would not only provide

to go on growing cocoa even in times of low prices, byprotection against extreme market fluctuations, thebalancing the lower cocoa income by additional income

other crops they could grow could increase their income

from other crops.

considerably. (GIZ/WCF 2011: 33, BMGF 2008: 18) Standards Bodies,

Social Issues

Visual 11 income effects of yield increase

Social issues are still a major problem in cocoa farming;
gender based inequalities, illiteracy, hazardous working
conditions, long working hours, lack of education, childtrafficking, and (worst forms of) child labour, to name$ 3.189a few, are still all too commonplace throughout thecocoa belt. Though many of the current projects claim
to deal with these issues, key performance indicators onthese projects often insufficiently reflect the declaredintentions. Improving yields, and even improving income,are not direct guarantees that the ‘softer’ problems will
also be diminished.

$ 253

$ 957
$ 434

Gap to absolute poverty

Current projects should make a conscious effort toincorporate these issues into their core plans and$ 278

Additional income fromincreased FOB price$ 957

Additional income fromcrop diversification

ensure that the issues are not merely transferred to other

Additional income fromincreased productivity

schools within acceptable distance of all cocoa growing$ 252

reporting. Remediation programmes, such as FLO’s recent
child labour remediation strategy, are a necessity toregions or other branches of industry. There is a need forcommunities. Lastly, farmer training programmes needto increase the focus on social elements within theirprogrammes, and ensure that farmers are sufficiently
sensitised to the advantages of tackling social issues.

$ 2.005

Ghana$ 1.164

Current total income
per household

Cote d’ivoire

Cocoa Barometer 2012

6 Recommendations

Recommendation 1:
Increase, diversify& stabilise income of farmers

Recommendation 2:
Improve infraand support structure

Recommendation 3:
Increase pre-competitive
collaboration

24> Living income in the cocoa
sector should be internationallydefined and accepted, and shouldbe central to all sustainability
programmes. Sector-wide dialogue
is necessary to ensure thishappens, for example through theformation of a multi-stakeholder
body.
> Diversification of income isessential to creating stable andsufficient income for farmers. All
initiatives should provide sufficient
focus on this aspect of farmer
training and awareness.
> Long-term relationships between
traders and farmers, including
up-front payments covering costof production, can lead to a faircontract farming system, whererisks to price volatility are sharedequitably.
> Private or state-run marketingboards, such as Cocobod and CCC,
should be set up in all major cocoagrowing nations to foster stabilityof prices. Existing storage facilities
could be expanded and utilised tostabilise price in years of bumper
harvests. Alternatively, a Global
Fund could be set up to fulfil thisrole on a global level.
> Increase prices of cocoa paid atfarm level.

> Roads, water supply, healthcare,primary and secondary education,
farmer training facilities,
warehousing, and improved
access to market information
are all essential ingredients of a
locally functioning infrastructure.

> It is in businesses’ interest to
directly support investments inprojects that further developthese issues.
> Structurally, a larger part oftaxation derived from the sector
needs to be reinvested in local
infrastructure.
> Financial institutions should
develop agricultural services,
enabling small-scale farmers
to access credit, start a saving
system, and ensure small-scale
farmers can invest in cocoa
production and diversification of
products, as well as participate
in standard and certification
programmes.
> Ensure that farmer training(including access to certification)
is available to all cocoa farmers.

Cocoa Barometer 2012

> Increased collaboration between
Standards Bodies should be
actively pursued, beyond
streamlining of curriculum
and farmer training, to include
auditing> Besides national roundtables,
consuming and producing
nations should actively pursue
cooperation at creating
global common definitions ofsustainability and supporting
sustainable cocoa production.
> All parties should ensure thatadhering to fundamental humanrights are addressed in precompetitive cooperation.

Recommendation 4:
Create a level playing field

Recommendation 5:
Prioritise social issues andworking conditions
25> Adopt a common set of measuring
tools and sustainability standards(including a continuous
improvement standard).
> Make compliancy to thesestandards a ‘license to operate’ forthe sector.
> Increase transparency, on datasuch as number of farmers
reached, figures on costs andimprovements achieved> Evaluate all projects by industry
and Standards Bodies on aregular basis, to a common
evaluation standard (including thecontinuous improvement model),ensuring compatibility andbenchmarking of evaluations.
> Promote financial transparency
through country-by-countryreporting for multinational
corporations on prevention of tax
avoidance and corruption and toensure that revenues from cocoa
can be invested in cocoa projects> Promote the Implementation of
the Guiding Principles on Businessand Human Rights in order to haveindividual monitoring systems
to prevent further human rights
violations in the cocoa sector.

> Farmer training programmes
need to be based on an inventory
and prioritisation of all issues,
including the social ones, andensure that farmers are able
to include social issues in theiridentification and prioritisation ofproblems.
> Current projects should make aconscious effort to incorporate
these issues into their core plans
and reporting, at minimum
including social issues andworking conditions within their
Key Performance Indicators andCSR reporting.
> Individual companies should
issue third party independent
reports on social issues andworking conditions (such as FLA’s
child labour research for Nestlé).
Recommendations and plansof actions should be set up in
response, covering the entirety of
the cocoa supply chain.
> Remediation programmes, suchas FLO’s recent child labour
remediation strategy, are anecessity to ensure that the issues
are not merely transferred toother regions or other branches ofindustry.

Cocoa Barometer 2012

7 Sources of Information

26

Justification of figures and tables
Visual 1: Estimates based on figures of the World Cocoa Foundation
http://worldcocoafoundation.org/wp-content/uploads/CocoaMarket-Update-as-of-3.20.2012.pdf
Visual 2: Source: ICCO 2012, Table 4
Visual 3: We have shown the 2011/2012 growing season insteadof the 2010/2011 growing season, due to the exceptional and nonrepresentative harvest of 2010/2011. Source: ICCO 2012: Table 1(2011/2012 forecasts) / for 2020/21: World Agroforestry Centre 2011: 2
Visual 4: UNDP and World Bank define poverty to be under $2 aday, absolute poverty $1,25. These definitions are based on parity
purchasing power instead of absolute dollars, and are certainly not
undisputed (definitions could be on the very low side).
Calculations on farmer income from cocoa are currently notavailable, so we have attempted to make a rough indication, basedon available documentation. We have taken farm size, average
yield per hectare, FOB price and the percentage that farmers can be
expected to receive of the FOB, as well as average costs for cocoa
farming. The results can be found in the table below.
These costs and income are only from cocoa, so where farmers haveadditional income this income will be higher. However, cocoa ismostly a monoculture crop at present, so this income is generally
speaking the same as total farm income. Obviously, there are manyother variables, such as variations of price per region, world market
price, access to markets etc, but the authors believe this to be atleast a reasonable approximation of reality.
Sources: Number of dependants: Ghana: Hainmueller/Hiscox/
Tampe 2011: 11; Côte d’Ivoire: Republic of Côte d’Ivoire 2008: 40.
Farm size: Ghana: Hainmueller/Hiscox/Tampe 2011: 15; Côte d’Ivoire:
FLA 2012: 31. Costs: Ghana & Côte d’Ivoire: KPMG 2012: 60-62
Average household income
Dependents
Yield (tonnes per ha)
Average farm size (in ha)
FOB
Share of FOB for farmer
Costs per hectare

Ghana
3
0,5
1,5
$2.50070%$162

Côte d’Ivoire
60,52$2.50050%$454Visual 5: West Africa’s cocoa farming population could decline
by as much as 80% in the next two decades. The average ageof farmers in West Africa is currently within ten years of life
expectancy, and only a fifth of children growing up in cocoa want
to be cocoa farmers. Based on figures by Hainmueller/Hiscox/
Tampe 2011, UNDP etc.
Visual 6: Data graciously provided by the Standards Bodies, basedon a questionnaire. Sadly, Organic is not shown, as they failed
to answer to repeated requests for information. In light grey thecommitments as made for the 2010 Cocoa Barometer
Visual 7: Based on input from Standards Bodies.
Visual 8: Data graciously provided by the companies. 13 major
grinders and chocolate manufacturers were sent a questionnaire,
which was (partially) returned by ADM, Armajaro, Blommer,
Barry Callebaut, Cargill, Delfi/Petra Foods, Ecom, Ferrero, Olam,Mars, Mondelez, and Nestlé. Only Hershey failed to respondwith numbers. As the data submitted in the responses were noteasily comparable, and credibility issues arose regarding thereal measurement programs used, this calculation provides only
a coarse estimation of the current situation. Because of trade,double registration at Trader/Grinder level is not only possible, it
is inevitable.
Although Ferrero has committed to 100% ‘sustainable’ cocoa
sourcing by 2020, their sourcing does not follow the conventional
major standards bodies of RA/FT/UTZ/Org, although it does entail
third-party independent verification at farm level.
Visual 9: Prices adjusted for inflation, based on constant 2010/2011
indexations. Source: ICCO 2012a, Table 2
The prices of the 2011/2012 growing season have been added, forthe same reason as in Visual 4.
Visual 10: Source ICCO 2012, Table 9
Visual 11: Source: BMGF 2008. Though there are quite a few
assumptions made by McKinsey in this calculation, the basic
premise is that yield increase alone will just not be able to raise
the income of farmers sufficiently.

Cocoa Barometer 2012

Literature

Colophon

A complete list of literature can be found on:www.cocoabarometer.org/literature

Citation:
Hütz-Adams, F. and Fountain, A.C. (2012): Cocoa Barometer 2012
Text: Friedel Hütz-Adams (Südwind-Institut), Antonie Fountain(STOP THE TRAFFIK)
Additional Contributions: Catherine van der Wees (Hivos),
Rudolf Scheffer (Oxfam Novib), Jan ‘t Lam (Solidaridad), Marieke
Poissonnier (Oxfam Wereldwinkels), Andrea Hüsser (Berne
Declaration), Mark Zirnsak (STOP THE TRAFFIK), Mieke van Reenen,
Gijs Verbraak, Sjoerd Panhuijsen
Design: Tegenwind, Roelant Meijer, Utrecht
Print: Drukkerij Mostert & van Onderen, Leiden

Abbreviations
ADM
CEN
CCC
CCE
EU
FAL
FLO
GIZ
ICCA
ICCO
ICI
IDH
ILO
INTA
NGO
RSCE
STCP
TCC
WCC
WCF
WFCL

Archer Daniels Midland
European Committee for Standardisation
Conseil du Café-Cacao
Certification Capacity Enhancement
European Union
Forced Adult Labour
Fairtrade Labelling Organization
Gesellschaft für Internationale Zusammenarbeit
International Cocoa Agreement
International Cocoa Organization
International Cocoa Initiative
Initiatief Duurzame Handel(Dutch SustainableTrade Initiative)
International Labour Organisation
EU Parliamentary Committee on International Trade
Non Governmental Organization
Roundtable for a Sustainable Cocoa Economy
Sustainable Tree Crop Program
Tropical Commodity Coalition
World Cocoa Conference
World Cocoa Foundation
Worst Forms of Child Labour

We appreciate the effort of companies and standards bodies inanswering our questionnaires. Special thanks goes to Gijs Verbraak,Sjoerd Panhuijsen, and Mieke van Reenen, of the former TCC, whose
contribution to this Barometer has been invaluable.
We acknowledge the support of the Ministry of Economic Affairs.
The final responsibility for the content and the views expressed inthis publication lies solely with the authors.

Participating organisations:
VOICE Networkk (members marked with a *)Stop The Traffik*
Südwind-Institut*
Berne Declaration*
Oxfam Wereldwinkels*
FNV Bondgenoten*
Oxfam Novib*
Solidaridad
Hivos
Requests for information can be addressed toAntonie Fountain, Stop The Traffik
antonie@cocoabarometer.org+31 20 420 39 52

Cocoa Barometer 201227

Cocoa Barometer 201228

The coming decade will see a significant rise in demandThis requires individual responsibility and commitment,

for cocoa while current plantations and their workers areas well as an increased collective approach. Industry,ageing, reducing yields if nothing is done. At the same

government, standards bodies, and civil society musttime, farmer population will decline. Destitute poverty,

find ways to cooperate more closely, at competitive, but

dismal working conditions, and uncertain land rights will

especially at pre-competitive levels.

all contribute to these changes.
Business as usual is not going to solve the crisis that
To combat these challenges, certification of farms against

the cocoa sector is in. Significant changes must happen,a voluntary standard is being rolled out, yield increase

and they need to start happening soon. This Barometer

programmes are being implemented throughout Westis a call for action, specifically on the issues that are

Africa’s cocoa belt, companies and consuming nations are

not receiving sufficient attention. Though some steps

embarking on commitments to the usage of certified andin this direction are already being taken, we must go

otherwise sustainable cocoa, and producing nations are‘Beyond Productivity’, and embrace a holistic approach to

implementing various programmes and Roundtables.

sustainable cocoa.

Solutions will need to go ‘beyond productivity’ to deal

An approach that will ensure that in generations to comewith the root of the crisis in cocoa production; generating

there will be a vibrant cocoa growing community.

income stability, reducing price volatility, improving local

A community where farmers are proud to be cocoa

infra- and support structure, ensuring access to financefarmers. Because of the quality of their product, but –and agricultural inputs, reducing negative environmental

even more importantly – because of the quality of life

effects, and improving social and labour conditions.

that growing cocoa has made possible for them.

Common standards need to include all elements relevant
for the whole chain, and be built on priority setting andcontinual improvement.

Cocoa Barometer 2012