Where do cacao farmers fit in?

Most chocolate consumers don’t consider where their chocolate is coming from. Those of you reading this blog are already ahead of your peers, because you’re educating yourself about the process, about what it takes to bring those tasty bars of chocolate to your tongue.

Even then, the majority of what I’ve covered so far involves the processing end of chocolate, once it’s considered cocoa. However, there’s a whole world of chocolate that occurs before the beans are hard and dry. That’s the world of the cacao farmers. I’ve discussed the importance of knowing the supply chain of your food, and the concept of slow food. It’s also important to consider the individuals who plant the cacao trees, cut down the cacao pods, and open them up to ferment and dry the cacao beans.

Recently, a video of a cacao farmer tasting chocolate for the first time went viral. The video was produced by Dutch news outlet, Metropolis. NPR covers the story focusing on the divide between producers and consumers. Metropolis also covered the other end of the story: what Dutch chocolate consumers feel and know about the plant their chocolate came from.

A few chocolate-makers are already paying close attention to the farmers, incorporating them into their decision-making process, and ensuring that their voices are included at the table of the chocolate industry. For example, SPAGnVOLA in Gaithersburg, Maryland, is a vertically integrated chocolate business. They own their own farm in the Dominican Republic and control every part of chocolate production, from branch to bar. I highly recommend taking a look at their single estate system and impressive impact strategy. Eric Reid, CEO and Founder, explains his strategy on a visit to Nigeria here.

Additionally, Askinosie Chocolate in Springfield, Missouri, provides one of my favorite models for a chocolate company. They practice direct trade (something we’d love to do here at Root Chocolate). They also incorporate the farmers they work with in their financial decisions with a strategy they call “a stake in the outcome,” and provide community development support through “a product of change.” Shawn Askinosie also operates Chocolate University, teaching local kids the ins and outs of chocolate and leads trips to Tanzania to share the chocolate journey with those who produce the chocolate in the first place. Shawn gave a commencement address to Missouri State University in December 2011 that still gives me chills.

We’d love to meet these exemplary leaders in the chocolate industry some day! Both Eric Reid and Shawn Askinosie consider the well-being of the cacao farmers just as important as the rest of the chocolate-making process. And frankly, chocolate wouldn’t happen without them, so we agree!

In a recent conversation with Yellow Seed about importing cocoa beans as a network of chocolate makers, an interesting idea came up. What if, just like we chocolate-makers choose which farmers or co-ops to source our beans from, the farmers themselves have the chance to decide which chocolate-makers to sell their beans to? In other words, why not provide some agency to the farmers in the process?

In this world of international trade, inequality, and scarcity, I’m still working out how to best incorporate the interests and voices of the cacao farmers into the chocolate we produce. Thankfully, there are leaders in the industry like SPANgVOLA and Askinosie. If you have additional ideas, please feel free to comment below!

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Importing Cocoa Beans

My first ever post on The Chocolate Life was a naive call for small-scale farmers to send me their beans. Little did I know that one of the biggest hurdles to starting a “from the bean” chocolate business is obtaining high quality, well-fermented cocoa beans! And collaboration is the best way to a successful importation process.

The difficulty of obtaining high quality beans can actually be considered both good and bad.

Why is it good?

There is a definite shortage of good cocoa beans in the world. Chloe Doutre-Roussel writes in her book, The Chocolate Connoisseur: For Everyone With a Passion for Chocolate, the following:

An estimated 15% of world production:

Good beans (e.g. Crillo/Trinitario hybrid of Trinitario) + good fermentation = good chocolate

Good beans + bad fermentation = bad chocolate

An estimated 85% of world production:

Poor beans (e.g. Forastero) + good fermentation = poor chocolate

Poor beans + bad fermentation = terrible chocolate!

Our friends at Arete reminded us that while we are joining a very welcoming community, not everyone can! Cocoa beans are a scarcity and it’s actually a benefit to the industry that it’s difficult to obtain them.

Why is it bad?

Well, we want to be using good beans, so of course, we’d prefer this process was easier. Plus, in the spirit of Slow Food, we’d love it if delicious chocolate were accessible to everyone. That said, we’re always up for a challenge!

So, how do “from the bean” makers obtain cocoa beans?

There are two options. We can obtain them directly from the source or indirectly.

Obtaining beans indirectly

Obtaining beans indirectly is much easier. This would mean buying beans that someone else has already imported. We’ve done that by stopping by the Grand Central Market in LA, a few small markets in San Francisco, purchasing a bag of beans from Dandelion, and samplers from Chocolate Alchemy. Even our purchase from Piper of Siriana Cacao was an indirect buy, since we did not work directly with the farmers/co-ops/international producers in country.

Another way of purchasing beans indirectly is through one of the many members of the Cocoa Merchants’ Association of America, among other suppliers.

The pros are that this is faster, easier, and often cheaper than buying directly from a cocoa producer. Additionally, it is possible to buy in small quantities (less than 100 lbs at a time).

The cons, on the other hand, are that this way does not build a relationship with the producers and can hide many of the issues related to supply chain that are important to me and many other small-scale chocolate makers. Additionally, this limits the selection of beans to those that someone else is already working with.

Obtaining beans directly

Obtaining beans directly from the source is considerably more difficult, as it requires international trade, minimum orders, and often a direct relationship with the cocoa producers. At the moment, as far as I’m aware, there are two ways to obtain directly: hire a broker to facilitate the sale and shipping process, or take care of that process ourselves. According to our friend Dan at Tabal, hiring a broker is a good idea if the total sale comes out to more than $2,000. (Wow, the most we’ve spent on beans so far was about $25 for 2 kilos from Dandelion!) You can find a list of brokers here.

Alternatively, there are two ways to follow through on the process without a broker: ship beans by a mail carrier like DHL or FedEx, or ship the beans in a shipping container by boat. A colleague on The Chocolate Life, Juan Pablo Buchert of Nahua Chocolate, helped explain to us what a cost structure of shipping beans with a mail carrier would look like:

You can receive the beans at you home, or shop, at an extra cost that is charged by the freight forwarder (FedEx, DHL). They can deal with the customs clearance as well. For example this is the cost structure for a 250 kg (550lb) shipment that we recently sent from Costa Rica to Chicago and delivered to a chocolate shop there:

Air Shipment……………………  $437,50

Charges at origin………………  $386,50 (Customs, pallets confection, pick up)

Charges at destination………… $  297,50  (Doc Handover & Delivery)

Total Shipping…………………….  $1.121,50    ($4.49/kg or  $2.04/lb)

The incoterm selected was DAP – Delivered at Place-  (Not FOB or CIF). Some clients decide to deal with customs clearance themselves and save the Charges at Destination, in this example $297.50. Obviously, this is an example of a large shipment for a home based chocolatier.

Smaller quantities (up to 50 lbs at a time) come in at 2.5 lbs for $22, including shipping, charges at origin, and charges at destination, then it goes up from there.

This also required an FDA-certified facility, USDA registration for the import, a copy of the invoice, and a phyto-sanitary certificate issued at origin.

What should we do about it?

Good question. The difficulty of importing beans prevents many small batch makers from establishing a relationship with the cocoa producers and controlling our supply chain. Facilitating the process involves many moving pieces: international law, trading regulations, and an incredible amount of support both for the farmers (to get their beans from the farm to a shipping port) and for the chocolate-makers (to organize a payment agreement for a shared shipping container).

For that reason, we’ve begun conversations with organizations like Yellow Seed, which seeks to fill the gap between chocolate-makers and cocoa producers. We’ve talked with chocolate-makers like David at Letterpress Chocolate, Eli and Tracey at Bisou, and David and Leslie at Arete, among others about sharing costs to charter a container to California.

This is a service that could revolutionize the small batch industry, so we’re looking forward to continuing the conversation and learning about available options. If you have ideas or suggestions, please leave your thoughts below in the comments. We’re certainly open to learning more!