A chocolate shortage?

There has been a lot of news recently regarding the world chocolate shortage. Some sources are stating that there will be a 1 million MT deficit in chocolate by 2020. The ICCO denies that projection, adding that this year actually showed a 40,000 MT surplus of chocolate.

A few factors certainly could contribute to a shortage of chocolate overall in the world. Note the emphasis on overall. If we’re to take the chocolate shortage claims seriously, we must include all the factors that could contribute. According to All Day, those factors could include:

  • Environmental factors: frosty pod and dry weather in West Africa
  • Health & political factors: shutting borders between Liberia & Guinea with the Ivory Coast due to Ebola
  • Local economic factors: farmers choosing rubber instead of cacao, and farmers are aging but the younger generation has not indicated its interest in continuing to farm cacao
  • Global economic factors: increased demand in China & India: by 29%
  • Global demand factors: consumers are interested in darker chocolate, which has a higher cacao percentage

As a result of the increase in demand and decrease in supply, there are a few consequences that also could contribute to a reduction of chocolate in our lives:

  • Prices: prices would go up (basic economics), making chocolate less accessible to the general population
  • GMOs: Chocolate companies are working on synthetic cacao trees, which would be more resistant to disease but less complex in their taste
  • Chocolate substitutes: Chocolate makers may begin filling their products with more nuts, fruits, etc. rather than providing straight chocolate

Now let’s take a step back and think about how that affects bean-to-bar makers who engage in direct trade or fair trade with the farmers who produce the cacao…

The bottom line is: very little!

Harriet Lamb, CEO of Fair Trade International, writes her solution to this potential shortage in The Guardian:

To prevent a chocolate shortage, farmers need to earn a better income now… This is the critical next leap that the chocolate sector needs to make. We need to pay farmers more for their cocoa today if we want to keep them farming for tomorrow. Our very chocolate depends on it.

In other words, small batch chocolate-makers like Askinosie and SpagNvola are already working in this way and will be less affected by a potential shortage. It’s the large chocolate companies that produce chocolate in bulk who need to learn from their bean-to-bar peers. In fact, those with branch-to-bar strategies are even more convincing. If the chocolate-makers absorb a higher percentage of the cost, then farmers will be better paid and more highly incentivized to produce the best cacao they can.

There are a few caveats. This policy could end up increasing the cost of chocolate to the consumer. If so, it could lose one of the principles of Slow Food: though it would be fair to the farmer, it would not necessarily be accessible to the average consumer. Additionally, as long as the new consumers in China and India could pay for it, this policy would not quite address the increase in demand. That said, most of the bean-to-bar market already focuses on higher-end consumers, providing a higher quality product at a higher price point than mainstream chocolate bars.

So, should the conscientious bean-to-bar chocolate-maker worry about a chocolate shortage? Our answer: just a little bit. And at the same time, take advantage of this new opportunity to share the practices that could alleviate a shortage in the future and simultaneously support the farmers!

To read more about the potential chocolate shortage, see the articles below:

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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!