Cocoa producers threaten to axe sustainability schemes

17 October 2019

Ghana and Côte d’Ivoire have threatened to discontinue cocoa sustainability certification programmes over concerns they are being prioritised “at the expense” of decent pay for farmers.

The Ghana Cocoa Board and Conseil du Café-Cacao in Côte d’Ivoire accused brands of focusing on sustainability certification programmes, such as Fairtrade and the Rainforest Alliance, which only benefit a “selected few” farmers, rather than a Living Income Differential (LID).

The countries, which produce more than 60% of the world’s cocoa, introduced the LID in July 2019. Under the LID a "living income" premium of $400 will be added to the price of each tonne of cocoa from the 2020-21 season.

The countries plan to use to LID to guarantee farmers are paid a minimum price of 70% of a $2,600 floor price per tonne of cocoa.

If prices rise above $2,900, proceeds from the LID will be placed in a stabilisation fund to ensure farmers get the target price even if market prices fall.

According to Reuters, trade and government sources said chocolate makers had been slower to pay for the pricier beans. Around 150,000 tonnes of 2020-21 cocoa have been sold, in comparison to about 450,000 tonnes this time last year.

A source at Cocobod, Ghana’s cocoa regulator, told Reuters the two countries would do “whatever it takes” to make the LID work, including halting sustainability schemes within the next few weeks if chocolate makers don’t comply.

The cocoa boards said some buyers had shown strong commitment to the new system and its implementation for the 2020-21 crop year, adding the LID has a “more direct positive impact on all cocoa farmers”. 

The cocoa boards said: “It is worth noting that while the LID focuses on the livelihoods of all cocoa farmers without exception, the sustainability programmes being implemented by the brands only affect a selected few farmers.”

A joint technical committee of the two countries will be re-examining sustainability and certification programmes for the 2019-20 season. 

“A firm decision on the continuation or discontinuation of all sustainability and certification programmes will be communicated to stakeholders by the leaderships of Le Conseil du Café-Cacao and Ghana Cocoa Board at the World Cocoa Foundation Partnership meeting in Berlin.” 

The Berlin meeting takes place on 23-24 October 2019.

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