Cocoa Growers Review Chocolate Brands’ Sustainability Plans

(Bloomberg) -- The world’s biggest cocoa producers said they are reviewing the sustainability programs of chocolate companies because some projects are undermining growers’ plans to secure better prices for their beans.

Ivory Coast and Ghana, which account for about 60% of global supplies, made the announcement as they seek wider acceptance for their intention of adding a $400 per ton premium on their cocoa. The two West African neighbors adopted the so-called living-income differential in July to improve the pay for their mostly impoverished farmers.

The projects of chocolate brands only serve selected farmers while the living-income differential will benefit all growers, the two industry regulators said in a joint statement on Thursday.

“It has been observed that the brands are focusing more on their sustainability programs at the expense of the living-income differential,” Ghana Cocoa Board and Le Conseil du Cafe-Cacao said in the statement. A joint committee will review all sustainability and certification projects for the current season and will make a decision on their “continuation or discontinuation” this month.

The outcome will be communicated at the World Cocoa Foundation Partnership meeting scheduled for Oct. 23-24 in Berlin, the regulators said.

Amid pressure from consumers, chocolate makers are spending millions on programs to ensure that their cocoa is sourced from farms that are not intruding on natural forests and don’t use forced child labor for growing beans. Analysts are questioning whether the new price plan will work as brands are not able to hedge the $400 premium.

Only some buyers have shown “strong commitment” to the living-income differential, according to the regulators.

--With assistance from Isis Almeida.

To contact the reporters on this story: Leanne de Bassompierre in Abidjan at ldebassompie@bloomberg.net;Baudelaire Mieu in Abidjan at bmieu@bloomberg.net

To contact the editors responsible for this story: Andre Janse van Vuuren at ajansevanvuu@bloomberg.net, Robert Brand

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