1. It is possible to create an inclusive business model to help secure the cocoa value chain
Chocolate is a multi-billion dollar industry – the Cadbury brand alone generated nearly $4 billion in global revenues in 2015. Ghana and Côte d’Ivoire supply 60% of the world’s cocoa – yet much of that production is by smallholder farmers who struggle to make a living. Poor farming practices, crop diseases and lack of resources make cocoa an increasingly risky crop and many are turning away from cocoa farming, threatening the sustainability of supply. At the same time global demand for cocoa is increasing, so Mondelēz International needed to find a way to manage the quality and quantity of cocoa produced in a sustainable way.
Mondelēz International started working with CARE International in 2009, through the Cadbury Cocoa Partnership, which evolved into Cocoa Life in 2012. Through this Mondelēz International recognised that the key to protecting and strengthening its value chain was to take an integrated approach and support the whole community in order to make cocoa production a sustainable livelihood for farmers. Cocoa Life shows that it is possible to build a business model which strengthens a value chain in a way that benefits poor cocoa farmers.
Cocoa Farmer Felix showed us his farm and told me:
I have three acres of land split across two plots, with 411 trees. My trees are 15 years old and produce an average of 44 pods per tree per year.
A single cocoa tree typically only produces enough cocoa for 30 small bars of chocolate – so you can see how important it is to maximise the yield. Felix told me:
Before Cocoa Life there were a lot of weeds and I wasn’t pruning them properly – I didn’t think it mattered. Weeding is the hardest part of looking after the trees but now I know it’s important. I got training [through Cocoa Life], and now yield has increased.
As well as farming inputs and training, Cocoa Life recognises that farmers like Felix also need access to finance, complementary livelihoods, education and health to become really productive. This helps to diversify the local economy and make the cocoa communities more resilient.
2. Women are cocoa farmers too
A key issue is gender inequality. By ignoring the role of women, many global value chains are missing out on the opportunity to improve quality and increase productivity. Cocoa farming is viewed as a ‘male’ activity in Ghana but in reality it’s the women who do a lot of the work that is critical to productivity and quality of final output, such as fermenting and drying the cocoa beans. However women cocoa farmers face many challenges – they earn less than their male counterparts and struggle with lower farm productivity, smaller farms and less access to financing and farm inputs. So unless issues around gender inequality are addressed, productivity will remain low.
CARE and Mondelēz International have placed special focus on addressing the key challenges faced by women in cocoa farms, within their communities and at the household level. This includes setting up women’s groups to create a platform for women to receive training, discuss their challenges and work together to find solutions. The women’s group I met told me:
Life is tough as a woman. Getting money for small things is difficult – we depended on loans to support ourselves and our children. CARE came to my village and we formed a women’s group. We decided to start saving money to support ourselves. In the beginning our husbands were resistant as we met every Tuesday and were concerned about who would make the dinner. But now they see the benefits.
3. CARE’s holistic approach adds financial inclusion to cocoa value chains
CARE’s integrated multi-dimensional programme approach draws on all our experience and expertise gained over 70 years. Bringing together CARE’s different interventions such as financial inclusion means cocoa farmers can benefit from more than value chain programming.
Having managed one of CARE’s flagship financial inclusion partnerships, the Banking on Change partnership with Barclays, I particularly enjoyed meeting a savings and loans group made up of cocoa farmers, mainly women, and hearing how important saving had become to them.
Being part of a Village Savings and Loan Association enables the farmers, especially women, to start saving and increase their money management and financial literacy skills. By saving small amounts each week, members can access loans to expand their cocoa farming activities and/or other income-generating activities, such as making soap from the cocoa pod shells. A savings group member told me:
We save between one and five cedis [20p - £1] each week per person. If someone can’t come to the meeting they give their contribution to someone else to bring – otherwise they’ll get fined! We are saving to go into trading – we are looking for additional livelihoods to add to our cocoa farming. Last year we went into maize cultivation and shared the proceeds to feed our children.
Now the farmers are benefiting from the informal savings and loans services from the group, the next step is to support these groups to keep their savings somewhere safe, as well as access more sophisticated financial services. CARE is already working with financial and telecoms sectors to co-create innovative and scalable models to help savings groups to access appropriate and affordable financial services, and we are looking into ways to scale these to cocoa farmers.
4. There are young people who want to become cocoa farmers
The average age of cocoa farmers is around 56 and young people are leaving cocoa communities for the cities in search of more secure livelihood options. Felix told us:
I am 48 years old and I have 6 children – 2 girls and 4 boys between the ages of 4 to 24. None of them want to become cocoa farmers.
However, we met young people who can see a future as a cocoa farmer. CARE has set up a Cocoa Reading Club at Ahafoman Senior High School in Goaso to help children of cocoa farmers to come together and increase their literacy skills as well as learn about cocoa production, including through guest speakers and visiting demonstration farms. The reading club has 73 members (37% female) and meets every Friday.
One of the students told us ‘Cocoa is a business, it can be your profession’ and a show of hands indicated the majority were considering becoming cocoa farmers when they left school.
While there is still a long way to go to create a sustainable cocoa value chain, vital to the lives and livelihoods of poor cocoa farming communities, CARE and Cocoa Life are making steps towards helping cocoa farmers earn a living wage, and inspire the next generation of cocoa farmers.