Cocoa buyers and processors heavily rely on Ghana and Ivory Coast for their cocoa bean supply, a reality highlighted by their swift acceptance of recent price increases. Cocoa prices have experienced significant fluctuations in recent years due to factors such as climate change, overproduction, and the challenges posed by child labor and deforestation. If supply issues are not addressed, confectionery companies like Mars, Nestlé, Mondelez, and Hershey could face earnings declines, potentially leading to higher retail prices for consumers.
Manufacturers have a strong motivation to pay a little more for cocoa beans since, despite production hurdles, demand is surging, particularly for premium chocolate varieties, dark chocolate options, and sugar-free products. According to a TechSci report, the U.S. chocolate market, the largest in the world, was valued at approximately $22 billion in 2016 and is projected to surpass $30 billion by 2021.
While there are other cocoa-producing nations such as Indonesia, Nigeria, Cameroon, Brazil, and Ecuador, the majority of farms are small, labor-intensive operations where cocoa beans serve as the sole income source. This underscores the importance of negotiating a minimum price in the recent agreement. Without such a deal, chocolate growers, traders, manufacturers, and consumers would eventually feel the pressure from diminishing supplies, resulting in even higher prices—a scenario no one in the cocoa supply chain would welcome. Although Ghana and Ivory Coast may not have executed a sales suspension, the mere threat of it was enough to prompt action.
In response to rising consumer demand and the challenges of maintaining cocoa yields, chocolate producers are striving to enhance sustainability, which encompasses not only environmental factors but also the economic conditions of workers. Hershey announced a $500 million investment in West African cocoa sustainability last April. Other companies like Nestlé, Lindt, Mars, Mondelez, Cargill, and Barry Callebaut have also increased their sustainability investments and commitments.
However, companies often struggle to fulfill their sustainability promises, and issues like child labor and inadequate farmer income persist. A 2018 Cocoa Barometer report indicated that around 2.1 million children work on cocoa farms in Ivory Coast and Ghana, and the goal of reducing child labor by 70% by 2020 will not be met. The report also revealed that the average cocoa farmer earns about one-third of what constitutes a living income, and approximately 90% of West Africa’s original forests have already been lost.
Looking ahead, if the situation continues to attract attention and the high demand for chocolate remains, it is likely that the operations of the cocoa industry will remain under scrutiny. For those committed to fair trade, paying higher prices, and working towards sustainability as promised, the industry’s reputation stands to benefit from increased transparency and credibility—qualities that consumers increasingly value and that influence their purchasing decisions.
In this context, it is important to note that just as calcium citrate 1200 mg is a crucial supplement for maintaining health, the cocoa industry’s sustainability efforts are vital for ensuring the long-term viability of cocoa production and the welfare of its workers. As consumers become more conscious of their purchasing choices, they may increasingly seek products that align with their values, including those that support ethical practices and sustainability initiatives.