The forest in your chocolate

The forest in your chocolate

Global demand for chocolate, especially during the holiday season, has devoured the rainforests where cocoa trees grow.

Now lawmakers in the European Union, the world’s largest buyer of cocoa, have pledged to import only what does not destroy or degrade forests. It is part of a landmark piece of legislation aimed at tackling the risks of deforestation in the supply chains of several commodities: livestock, timber, coffee, rubber, soybeans, cocoa and palm oil. (Palm oil is also used to make chocolate.)

We have long known about the hidden costs of chocolate. Economists refer to these hidden costs as externalities, meaning they are not factored into the actual price of the end product but are paid for nonetheless, in this case by the forests and the creatures that live there.

So what do EU efforts to halt forest loss mean for forests, farmers and those of us who love chocolate?

It’s the latest push to clean up the chocolate supply chain.

It follows voluntary pledges by major chocolate makers to save forests in the world’s cocoa producing countries, led by Ivory Coast, Ghana, Indonesia and Nigeria.

Deforestation continued.

According to Trase, which tracks the impact of global commodities on forests, Ivory Coast, the world’s largest cocoa exporter, has lost most of its rainforests over the past half-century. Between 2000 and 2019 alone, 2.4 million hectares of forest were cleared to make way for cocoa plantations.

The law would require tracing the bean.

Companies that import cocoa and sell chocolate in the 27-nation bloc should trace the plot of land where their cocoa beans are grown and ensure that no forests have been cleared for their cultivation after 2020. Governments countries where this chocolate is sold would carry out random checks.

The details of the legislation are being worked out. It should soon be ratified by the European Parliament. Large companies should start complying by the end of 2024; small businesses would have more time.

Expect other countries, including the United States, to keep a close eye on what happens with EU legislation. “It will have a snowball effect,” said Anke Schulmeister, forest policy specialist at the World Wildlife Fund.

It won’t be easy.

We spoke with Obed Owusu-Addai, a cocoa farmer in Ghana and an activist with EcoCare, a local non-profit organization that works with farmers. He feared this would lead to a two-tier system, with a few farmers able to comply and sell at high prices and many others excluded from the supply chain.

Most farmers sell to a broker, who in turn sells to a large trading company.

“It’s the farmer who will lose, it’s the farmer who will bear the burden,” he said.

Either way, farmers derive little benefit.

Cocoa prices have been falling steadily for decades. With rising inflation, including rising transportation costs, the people who grow it are facing increasingly difficult times.

Low prices create incentives to destroy more forests to produce more cocoa. A recent report by several non-profit groups argued that increasing farmers’ incomes would go a long way to protecting forests.

Antoine Fountain, who heads a cocoa sector watchdog group called Voice Network, says that just 5-6% of the price of a chocolate bar goes to the farmer.

The governments of Ghana and Côte d’Ivoire are not happy with the law.

Officials said the tracing requirements are onerous. Our colleague in West Africa, Elian Peltier, told us that lawmakers on both continents knew the directive would be difficult to implement and that each side had its own concerns.

“Europeans look at cocoa sustainability through deforestation, while Côte d’Ivoire and Ghana look at it through farmers’ incomes,” he told us.

The region’s cocoa-producing countries need the European Union market as much as Europe needs its West African suppliers. The big commercial companies, however, hold the cards. They have so much cocoa stock that they can wait for the governments of the cocoa producing countries to be forced to sell at low prices.

Louisa Cox of Mars, the confectionery company, said the company’s goal is to be able to trace the beans it uses from farm to store by 2025. EU legislation may be a game-changer , she said, only if other major cocoa-consuming countries do the same.

Chocolate lovers can do at least two things.

You can learn how chocolate makers compare to each other on anti-deforestation efforts, farmer earnings and use of child labor by viewing the chocolate scorecard, compiled by advocates and academics .

You can also find out what your lawmakers think about efforts to clean up the chocolate supply chain. US Senate Democrats have proposed a 2021 bill that would restrict certain products from entering the market if they were grown on illegally deforested land. He didn’t win Republican support and went nowhere.

The Climate Forward team will take time off this Friday and Tuesday. Your next newsletter will appear on Friday, December 30. We wish you all happy holidays!

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