Fair Prices for Cocoa: Too Much to Ask?

The price of cocoa has been in the news a lot again lately. First, the Supreme Court agreed that Nestle and other corporations could be sued by former child slaves, a move that may finally start to hold corporations accountable for labor abuse in their cocoa supply chains.

Fair Prices for Cocoa: Too Much to Ask?Next, a craft chocolate company was accused of fraud, bringing up, among other issues, questions of why some craft chocolate costs so much. Fortunately, many voices are speaking out to argue that, laying aside the issue of possible fraud, chocolate done right, starting with fair payments to farmers, needs to cost more.

Farmers only receive about a nickel out of every dollar consumers spend on chocolate products. The Prime ister of Cote d’Ivoire has said that the price of cocoa needs to rise by a factor of 10 just to eradicate forced labor from the industry. Farmers in West Africa live in extreme poverty and lack power in negotiating fair prices. Because of low prices, the sector has relied heavily on child and forced labor to complete harvest.

The last time this issue got widespread attention was last fall when Tulane University released a report showing that child slavery was increasing in West Africa. At that time, Fair World Project initiated an alert asking the International Cocoa Initiative, (ICI) a group that claims to “put children first,” to focus on cocoa pricing as part of their strategy. Farmers and their families need better prices.

We were able to send over 10,000 emails to ICI and they responded. Their response, which you can read in full, reads in part, “Where poverty is the main driver of child labour, the issue should preferably be evaluated from the perspective of household income, rather than simply looking at commodity-price…”  In other words, they agree farm families need more money, but don’t agree they need to raise the price of cocoa. They go on to talk about how there are many issues facing agricultural communities in West Africa, including widespread poverty that includes those who don’t grow cocoa, lack of schools, and gender discrimination, and that a holistic approach is needed.

We agree that a holistic approach is needed that addresses education, gender issues, and structural issues. But our argument was and is that increased prices for farmers need to be part of the strategy. Just because it is not a silver bullet, does not justify refusing to pay a fair price. As the Tulane study indicates, current strategies to address labor issues in cocoa are not working. It’s time for real solutions that include fair prices for farmers.

Cocoa will continue to be in the new , not only because it is notorious for rampant child slavery, but also because it is a crop threatened by climate change. The focus on corporate responsibility, addressing both accountability for supply chains and integrity in marketing claims, as well as the focus on the problems facing farmers and farmworkers should be welcomed. We need to constantly be reminded of what it will take to get to a place where consumers can consistently enjoy chocolate grown by farmers and workers who enjoy a living wage.

Posted on January 28th 2016

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