‘Shared Value’ in Cocoa – The Way Forward?

3 thoughts on “‘Shared Value’ in Cocoa – The Way Forward?”

  1. Dear Grabs, I am glad that you mention the cocoa industry in this forum.

    Although I have not taken a course in ethics, I think that this approach is solely in the interest of the consumer countries and the chocolate factories. I start by questioning the effectiveness of yield in raising farmer’s income while there are more appealing strategies like revisiting the price mechanism. Recent studies show that the vertical integration (from top to bottom) and market concentration have hampered the farmer’s bargaining power in the cocoa sector causing a low share in the chocolate value chain. Moreover, cocoa prices began to drop since early 2011 and are expected to worsen due to the fall in demand of chocolate (because of the crisis in the Euro zone and in USA) and equally due to the additive effect of cocoa production from the various producing countries (hence excess supply over demand).

    From an ethical and social point of view therefore I wonder why countries who rely on imports of food staples like milk and milk products, rice, fish, etc and whose population suffer from hunger, malnutrition and undernourishment indulge in the production of crops they do not consume…. does the pursuit of foreign earnings justify this? I think that balance of trade (of payment) accounts should be given more emphasis, rather than just foreign earnings.

    1. That is a really good point, Chi, thank you for commenting! I agree that the concept that is so intent on creating ‘new value’ seems to assume that the current distribution of value is adequate and fair – which is very debatable. And the increased influence of cocoa companies on the production practices of small farmers might lead to even greater dependency on them, especially if yield improvements hinge on expensive inputs…
      And the Cocoa Barometer also talks about the necessity of farmers to diversify and not only produce one cash crop in order to hedge against volatile prices. On the other hand, for a lot of countries these cash crop exports are the only way that they can gain foreign currencies and that the government can raise revenue – how that revenue is used then again depends, obviously, but if it were to be used for social development investments, maybe the people would benefit from it? But I agree that a controlled shift to more domestic production, keeping your trade balance balanced (haha), could be considered for greater domestic food security.

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