As of: February 14, 2024, 12:59 p.m
By: Lars-Eric Nievelstein
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Cocoa is more expensive than ever before.
Nevertheless, there is a risk of empty shelves in the summer and the farmers don't get the money.
The EU is counteracting this.
Vevey, Switzerland – Nestlé and other large chocolate manufacturers have been under public criticism for years.
Mainly it is about human rights.
At the expense of cocoa farmers, some of whom have to live well below the poverty line, the large corporations would enrich themselves by billions.
A series of new regulations are intended to prevent exploitation.
Price per ton for cocoa (as of February 13, 2024) |
$5,868 (New York Commodity Exchange) |
|---|---|
Children affected by child labor (Ghana and Ivory Coast) |
1.5 million (Norc Institute University of Chicago) |
The LkSG applies to companies with a number of employees |
1000 |
Share of Ghana and Ivory Coast in global cocoa supplies |
About two thirds |
Tree disease causes massive cocoa harvest failures
The prices for cocoa are currently rising drastically.
Within the last year, the price per ton doubled, the
Tagesschau
reported at the beginning of February - on February 13th it stood at 5,868 US dollars.
The reason for this: supply is tight.
According to the International Cocoa Organization (ICCO), rain and flooding in the growing areas have paved the way for diseases such as black rot.
Industry experts are concerned that the interim harvest in West Africa, scheduled to take place in April, could also be affected.
Record price for cocoa - the money doesn't reach the farmers © IMAGO / Newscast
Chocolate manufacturers are worried about supplies.
“This year there will likely be a harvest deficit of 500,000 tons of cocoa on the world market,” predicts Hermann Bühlbecker, who owns the pastry manufacturer Lambertz.
“That’s dramatic.” The entrepreneur has never experienced bottlenecks like the one he is currently experiencing.
It is not even certain whether there will be enough chocolate in summer and autumn.
Expensive cocoa does not bring farmers more money
However, cocoa farmers in Ghana and Ivory Coast are not benefiting from the increase in prices.
The state sales companies in both countries had already sold more than half of the harvest that started in October in the spring, when the price was not nearly as high.
Cocoa expert Friedel Hütz-Adams from the Bonn-based Südwind Institute, which advocates for a fair economy, said in the
Handelsblatt
: “If the price of cocoa remained permanently above $5,000 even in good harvest times, we would be rid of most of the problems in the cocoa sector, including child labor.”
The expert believes that chocolate manufacturers like Nestlé would have to pay more for cocoa.
Currently, around two thirds of the cocoa in Germany comes from Ivory Coast.
Reports of child labor have been circulating for a long time.
The children affected sometimes work with machetes or expose themselves to pesticides - some of which are banned in Europe.
Many people in Ghana and Ivory Coast live in “bitter poverty,” said Labor Minister Hubertus Heil (SPD), who saw the situation himself last year.
The supply chain law is intended to help protect human rights
The European Union and the member states have now drafted several directives to combat such abuses - even from a distance.
The EU's so-called deforestation regulation makes producers of raw materials such as cocoa responsible for respecting human rights, environmental protection and fair pay in the producing country.
Manufacturers who rely on child labor will then face a sales ban.
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In addition, the European Commission presented the proposal for a supply chain directive within the EU in February 2022.
This contains environmental and human rights-related due diligence obligations.
Large companies have to create a so-called “climate plan”.
According to the draft, the scope of application compared to the German Supply Chain Act (LkSG) should be expanded to include EU and foreign companies with more than 500 employees and more than 150 million euros in net sales.
For companies in risk sectors such as textiles and agriculture, the limit is 250 employees and 40 million euros in sales.
The LkSG requires companies with more than 1,000 employees at the national level to introduce due diligence obligations to address human rights-related and certain environmental risks.
This is how companies track cocoa
The example of the automotive industry recently showed that implementing such guidelines is not always easy.
In the case of cocoa production, however, significantly fewer companies are affected.
In Africa, digitalization appears to be the solution to the tracking problem.
An EC card with a chip, data and QR code should do the trick.
“We want to provide all producers with a card by the end of the 2023/24 harvest season,” explained Dadie Arsène from the cocoa control authority to the
dpa
.
“We then know exactly which parcel of land which cocoa bags come from.” This should make it possible to check whether the companies are complying with the requirements in the supply chain.
In addition, the farmers should receive their salary via this card.
“The laws will have a significant impact in the cocoa sector,” explained expert Hütz-Adams.
“This creates a lot of pressure within the cocoa and chocolate industry.”
With material from dpa