As COVID-19 spreads around the globe, it’s hitting hardest those who were already in poverty. Before the pandemic, cocoa farmers in West Africa were struggling, earning an average of just $0.78 per day. That kind of extreme poverty is no accident. The global cocoa trade is built on paying low prices to farmers and extracting billions of dollars in profit each year.
Just one company, Hershey Chocolate, managed to extract $1.15 BILLION in profits in 2019. That’s more per share than an average farmer earned in a week. Even before the COVID-19 pandemic, cocoa farmers were already in crisis. And chocolate companies were posting year on year of growth and higher profits, based in part on the low prices that have left cocoa farmers struggling.
It’s high time Hershey’s takes responsibility for the cocoa farmers they depend on. A recent paper from the VOICE Network lays out what’s needed:
- Support farm families’ livelihoods with a basic common income for April, May, and June
- Use existing supply chain mechanisms to provide healthcare education and resources to farmers and their families.
- Specifically consider how resources will include women, children, and those most vulnerable in communities.
Paying farmers a basic income for April, May, and June would allow them to stay home, as people everywhere are being called upon to do, and prioritize the health and safety of their families and communities. In Ghana, COCOBOD, the government cocoa board, says that the pandemic has already lost the country a billion dollars in cocoa revenue. Falling prices and buyers closing their doors hits small-scale farmers hard. The economics of the chocolate business mean that small-scale farmers have no such thing as a rainy day fund.
The Coronavirus is Novel. Chocolate Companies Focus on Profit is Not
In 2016, cocoa prices crashed. The cocoa and chocolate industry posted strong profits as the cost of their main ingredient plummeted. Meanwhile, cocoa farmers and producing countries lost an estimated $4-5 billion dollars. Most chocolate companies happily passed that windfall on to their shareholders and did nothing to support small-scale farmers. The result? A further transfer of wealth from farming communities to Big Food companies, continuing to grow an imbalance that originated alongside the transatlantic slave trade. That’s not just an accounting problem. In recent years, despite companies like Hershey making big pledges, child labor is up 10%. Deforestation in chocolate-growing Ghana increased 60% over the previous year in 2018, a bigger percentage increase than anywhere else in the world (the runner up, Cote d’Ivoire is the other main chocolate-producing country—together they account for approximately 70% of the world’s cocoa supply). The results of sustained low prices and underinvestment are clear. While the global COVID-19 pandemic may be unprecedented, there is all too much precedent for cocoa companies prioritizing profits over farmers.
Hershey’s Should Pay Farmers Fairly—Not Just Give to Charity
Time and again, Hershey’s has responded to the disaster unfolding in their supply chains with more public relations and sustainability marketing. Yet the impact for the families that grow their cocoa lags behind their claims of “Shared Goodness.”
It’s been nearly two decades since they pledged to eliminate child labor in their supply chains—and instead, last summer, a Washington Post expose showed just how many children still do dangerous, dirty work on cocoa farms. In 2012, Hershey committed to buying 100% “certified” cocoa by 2020. That vague goal was in response to activists calling on them to commit to buying fair trade cocoa and cleaning up child labor in their supply chains. Instead, they chose to use low-bar certifications such as Rainforest Alliance that have no minimum price requirements for farmers—and have themselves been exposed for failing to address child labor.
From Kit Kats to Kisses, Hershey’s brands make up 45% of the chocolate market in the U.S. If they choose to do right by cocoa farmers, it could make a big difference—every day and as they face the COVID-19 pandemic.
Yet once again, Hershey is on track to do little and market it big. So far, Hershey’s response to the pandemic has been inadequate. They have pledged $2 million in product to U.S.-based Convoy of Hope plus $100,000 to the Red Cross. These charitable contributions can’t hide the fact that these dollars are earned off the backs of farmers. And those figures represent just a fraction of their profits – 0.05% to be precise. As cocoa prices fluctuate and Ghana and Cote d’Ivoire each project losses of revenue from cocoa in the billions of dollars, it is clear that that money is just a drop in the bucket.
Hershey’s should not wait for farmers to end up destitute. Instead, it is time for them to take action to ensure the safety of farmers’ health and livelihoods.