Cargill Inc. is increasing the ante on its commitment to sustainably sourced cocoa as Western consumers seek greater assurance that their chocolate consumption isn’t fueling deforestation and child labor.
The Minnetonka-based company is a major global trader of cocoa, a crop largely grown in developing regions like West Africa, and recently announced stronger, more targeted goals for its “Cargill Cocoa Promise” that align more closely with the United Nations’ Sustainable Development Goals.
As a supply chain leader, Cargill is often scrutinized for its role in either helping or hurting environmental and social concerns associated with the harvesting of cocoa beans.
The release of the company’s third annual cocoa report comes on the heels of an investigative report by the British newspaper, the Guardian, that found “dirty cocoa” — or cocoa illegally grown within protected areas in Côte d’Ivoire, or the Ivory Coast — was being mixed into the “clean cocoa” supply chain.
Large companies like Cargill often buy their cocoa from cooperatives comprising many smallholder farmers — farmers owning small plots of land relying almost exclusively on family labor. There are many system cracks when it comes to traceability that make it harder to promise sustainable sourcing.
Cargill said its goals have evolved as the challenges faced by smallholder farmers have changed. The company has now turned these “evidence-based” discoveries into tangible steps that it can take to reach its goals by 2030.
Taco Terheijden, Cargill Cocoa & Chocolate’s director of sustainability, said he hopes this acts as a clear declaration to define industry’s role and hopes it helps the local governments define their own role as well.
“If you don’t define your role, it becomes this thing where we are pointing toward one another and waiting for someone else to do something. These are not easy, quick problems to be solved,” Terheijden said.
Cargill aims to eliminate child labor from its supply chain by 2025 and deforestation by 2030. It has implemented a number of educational programs for its farmers to spot and avoid such practices. The company also continues to partner with CARE International, a well-known nonprofit, which is working to create economic opportunities for women and open schools for children.
The company is closer to reaching 100 percent sustainably sourced cocoa beans in some countries, like Ivory Coast, than in others, like Ghana where only 4 percent can be traced to sustainable sources.
This past year, Cargill set up its own buying company in Ghana to address the problem. Rather than buying from a third party, which acts as a middleman, Cargill now has greater control and knowledge of where the beans are coming from and how they’re grown.
Technology provides data
It’s clear that technology is becoming a key vehicle for change in the supply chain. In 2016, Cargill established a mobile payment system and helped more than 31,500 farmers open bank accounts. Terheijden said this encourages economic savings and transparency while also providing Cargill with valuable data on its farmers’ income levels.
Cargill also used GPS to map more than 50,000 farms in Ivory Coast, 6,000 in Indonesia, and hundreds in Cameroon, with plans to do so in Ghana and Brazil, as well. This information is used to improve farm productivity and check for deforestation activity.
“The connection between farmer and market is not perfect yet, but it is improving,” Terheijden said. “The U.S. chocolate and cocoa market is being served by a supply chain that starts in West Africa. The average consumer is very far from the source of that supply. Everybody deals with consumers who are more and more critical and these tech solutions will be able to bridge that gap slightly better than the old methodologies.”