Divine Chocolate questions Fairtrade cocoa sourcing program

By Oliver Nieburg

- Last updated on GMT

Fairtrade defends cocoa sourcing program to loyal customer Divine Chocolate
Fairtrade defends cocoa sourcing program to loyal customer Divine Chocolate

Related tags Fairtrade cocoa Chocolate Sugar Sugar beet Fairtrade

Divine Chocolate says multinationals are escaping fuller Fairtrade commitments under the certification body’s new rules. But Fairtrade says its sourcing program is the only way to reach cocoa farmers at scale.

The Fairtrade Sourcing Program (FSP), launched last year, allows chocolate makers to source a single commodity - cocoa - on Fairtrade terms. Firms can carry an FSP logo if they source 100% Fairtrade cocoa for a brand. Previously companies had to source everything that could be Fairtrade as Fairtrade, namely sugar and vanilla.

Under the FSP, a chocolatier can bulk buy Fairtrade cocoa – for example Ferrero will source 20,000 metric tons (MT) of Fairtrade cocoa​ over the next three years under the FSP. Companies can also buy 100% Fairtrade cocoa for a brand as Mars will do for its UK and Ireland Mars bar.

Divine: No incentive to increase Fairtrade commitment

divine choc medium
UK Fairtrade-certified firm Divine Chocolate is 45% owned by Kuapa Kokoo, a 80,000 strong cocoa farming cooperative in Ghana that accounts for 5% of the country’s supply. The cooperative gets a share of Divine’s profits through dividends, which it spends as it choses on farmer bonuses, training or improvement to local infrastructure.

Sophi Tranchell, managing director at Divine Chocolate, said it was frustrating to see multinational corporations making lesser commitments to Fairtrade than they otherwise may have done under the old rules.

“This latest version of Fairtrade (FSP) means that it is now possible for a company to have certified products with surprisingly low percentages of cocoa in the ingredients, with no incentive to increase that percentage of the total ingredients - while Fairtrade sugar farmers miss out on the potential of supplying one of the major ingredients in these products.”

UK-based Divine Chocolate sources 1,000 MT of Fairtrade cocoa annually and ensures all its ingredients that can be certified are Fairtrade.

 “Global chocolate companies have each made big announcements regarding sizeable long-term investments they plan to make in cocoa farming, with little or no possibility of consumers calling the companies to account or knowing whether it is all spent, how it is all spent, and whether it actually overlaps with other commitments e.g to Fairtrade,”​ said Tranchell.

Fairtrade: Opening the door to more cocoa farmers

fairtrade marks compared2 with new logo
Companies can use the Fairtrade Cocoa Sourcing Program mark (left) if they source 100% cocoa for a brand as Fairtrade. Only brands carrying using all ingredeints that can be Fairtrade as Fairtrade can use the full Fairtrade mark (right).

Harriet Lamb, CEO of Fairtrade, told this site the FSP helped her organization to alleviate poverty for cocoa farmers in the developing world at a greater scale.

“We’ve opened the door for cocoa farmers to have more Fairtrade cocoa sales…If we’re not making enough sales, it’s very difficult for us to make an impact.”

She said the FSP was a different way for businesses to engage with Fairtrade. “The bar has not been lowered,” ​she said. Cocoa sourced under the FSP is subject to the same Fairtrade standards and premiums as the full Fairtrade mark. “The bit that has changed is the labelling side,” ​said the Fairtrade boss.

mars bar1
Companies sourcing cocoa under the FSP include Mars for UK & Ireland Mars bars and German Twix bars, Ferrero and Riegelein. Retailers such as Lidl, Kaufland and REWE have also made commitments.

Companies sourcing under the FSP can carry an FSP mark on their brand, but only​ if they are sourcing 100% Fairtrade cocoa for that brand.

Cocoa commitments rise under FSP

Nine companies signed up to the FSP when it launched last year and now 14 companies buy Fairtrade cocoa through the program.

Lamb said that many of these companies had agreed to scale up under the FSP, which will lead to an additional $4.4m in premiums by 2016 compared to pre-FSP levels. For example German chocolatier Riegelein will source all cocoa for its own-label ‘Riegelein’ assortment under the FSP by 2017.

Lamb said the FSP had helped Fairtrade cocoa sales grow sixfold in Germany in the first year. Globally, 6,000 MT of cocoa were sold under FSP in 2014 and volumes will rise to 22,000 MT by 2016, excluding Mars’ recent commitment for the UK Mars bar.

Banging heads against walls over sugar

Concern for sugar cane producers

sugar cane-flicker

Fairtrade CEO Harriet Lamb said she was concerned cane sugar producers in the developing world would be muscled out of the market by cheap beet sugar prices and subsidies from the EU. She said the situation may even worsen when EU sugar beet quotas are scrapped in 2017.

Lamb said the FSP was introduced after Fairtrade had “banged its heads against the wall​” in persuading chocolate makers to switch to Fairtrade cane sugar from the developing world.

“We’d been unable to convince the big chocolate manufacturers on the continent. They were insistent they were going to use locally-sourced beet sugar…The local sugar beet lobby is very strong and very powerful indeed,”​ she said.

Labeling rules don’t help either, she added. If a chocolate manufacture in Switzerland wants to use a Swiss-made mark on their brand for example, it must source Swiss-grown beet sugar.

Antonie Fountain, coordinator at VOICE Network (Voice of Organisations In Cocoa in Europe), said that chocolate companies had been reluctant to switch from beet to cane sugar because it changed the taste.

Divine sets the bar high

Lamb acknowledged Divine’s concerns on the FSP, but said the program could even strengthen Divine’s position as a leader in Fairtrade.

“There are always companies like Divine that will go the extra mile and set the bar high for the industry. They are at the forefront of Fairtrade," ​she said.

Despite her reservations on the FSP, Divine’s MD stood by Fairtrade. She said Fairtrade certification offered cocoa farmers a fairer deal, where other certifications and corporate cocoa development programs had not.

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1 comment

Everything counts in large amounts

Posted by hallometsteven,

About the recent partnership between Mars and Fairtrade UK : a Mars bar of 51 g contains 33 g of sugar. The Guardian wrote about the fierce lobbying pressure from Mars, Nestlé... a.o. towards the EU, to reform it's sugar policy. 10,000s of sugar cane farmers in the poorest countries indeed will go bust.

About 1 billion Mars bars are produced a year in Slough, Berkshire. Mars will be paying premiums of £1.3 million a year as part of the Fairtrade Cocoa Program. That's about 0,13 pence per bar. I might be wrong in this, Mars maybe knows better.

But, oh irony. Mars 'robbing' (another word for lobbying) cane farmers and in the mean time its bars to display Fairtrade labelling. That's not fair trade as it was meant to be.

In my opinion, these are important reasons why social entrepeneurs ánd the public are losing their appetite for the fairtrade mark in the UK.

FT UK is leading a way to the bottom by nilling willing trying to do what it would better leave to certifying bodies like Utz Certified and Rainforest Alliance, i.e. the a dage: everything counts in large amounts. They have to make a choice: supporting farmer-ownded businesses and brands like El Ceibo or Divine OR supporting Big Chocolate.

Everything counts in large amounts? The earning model of Big Chocolate is broken. As FT UK should know.

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