Barry Callebaut Doubles Down On Sustainability Investment In Côte D’Ivoire Cocoa Farms Ahead Of New EU Anti-Deforestation Law

Swiss cocoa processing giant, Barry Callebaut, has outlined a new set of sustainability targets in its latest Forever Chocolate report, including steps to transition fully to “forest positive” in 2025 and provide 100% mapping of its supply chain and traceability.

That means, by the end of the forecast period, none of the company’s cocoa beans will be sourced from deforested areas or regions that would have been deforested after December 31, 2020, in line with a new EU law introduced last month to fight global warming.

This deforestation-free regulation, which is expected to come into force in 2025, will restrict companies from selling in the EU unless their supplier has issued a “due diligence” statement confirming their product does not come from deforested land or has led to forest degradation.

The UN Food and Agriculture Organization (FAO) estimates 420 million hectares of forest — an area larger than the entire EU — were converted to agricultural use between 1990 and 2020, and EU consumption accounts for roughly 10% of global deforestation.

The situation is particularly dire in West Africa as two nations in the region, Côte d’Ivoire and Ghana, which together supply 70% of world’s cocoa, have lost approximately 94% and 80% of their forests in the past 60 years mainly to make way for cocoa plantation, posing a significant threat to the global environment.

In Côte d’Ivoire specifically, where cocoa exports make up 15% of the country’s total GDP and 40% of export incomes, only 2.97 million hectares of forest (8.9% of the nation’s land) left. Côte d’Ivoire is also increasingly pressured to supply more cocoa globally as Ghana is battling its worst economic crisis in decades, while other cocoa growing areas such as Indonesia are shifting towards more lucrative crops like oil palm.

Barry Callebaut’s goal is to help expand the forest land coverage to 3.4 million by 2030, the company promised during a recent press tour in Côte d’Ivoire, where it operates six different cocoa bean processing facilities and grinding factories.

“Deforestation is not a threat to cocoa production, but a threat to the world climate. Côte d’Ivoire has a role to play in fighting climate change,” Nicolas Mounard, VP of Sustainability and Farming from Barry Callebaut, told me. “We’re contributing to reforestation in order to bring positive effect” through an agroforestry model.

The model essentially encourages the growth of more non-cocoa seedlings, including avocado, teak, and Akpi seeds, to help diversify income sources for the farmer. Teak trees, besides being a main timber material, are intentionally harvested about 4.9 feet away from each cocoa plant to provide enough healthy shade, while maintaining moisture balance in the soil.

These non-intrusive seeds are carefully cultivated by Barry Callebaut’s local subsidiary, Société Africaine de Cacao (SACO), and are distributed through a designated coach who helps educate the farmer about more productive ways to increase cocoa yield, using digital devices to map their farms, and helping to diagnose diseases, such as fungus and swollen shoots (12-13% of cocoa pods are susceptible to diseases, I was told). This collaborative process is carried out through Barry Callebaut’s sustainability program, Cocoa Horizons.

However, the implementation of the agroforestry model is easier said than done, Mounard said, as poverty, rising cost of production, and factors alike, are driving farmers to narrowly focus on producing cocoa as their main cash crop.

Particularly, the price of fertilizers in the region has more than doubled over the past three years from CFA
CFA
12,000 ($20.12) to CAF 25,000 ($41.91) per 50kg bag. To put into perspective, each hectare of farmland , which grows roughly 768 cocoa trees, requires 400kg of fertilizers per year (costs about $335), while it yields 600kg of cocoa on average, I learned during the trip. These beans are sold for CFA 900 ($1.51) per kilogram, meaning an average farmer, who earns $906 from cocoa per year, has to spend one-third of their income on fertilizers on each hectare.

Mounard noted Barry Callebaut is able to work with the local Côte d’Ivoire government to help subsidize up to CFA 5,000 per ($8.38) bag of fertilizer for the farmer.

“What’s important [for Barry Callebaut] is to improve the level of income for farmers, but sometimes, it’s difficult for farmers to project themselves on the long term,” said Mounard, which is why it’s imperative to incentivize farmers to adopt the agroforestry system.

He added: “Our farmers are getting paid for receiving agroforestry system services and contributing to the environment. We perfected that approach over the last 12 months, and now we’re advocating for a cash payment of €50 (54.83) per year per hectare over the next 10 years to really create the alignment between our agroforestry model and the interest of farmers.”