The Progression of the Cocoa Trade in West Africa

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SEATTLE — The West African cocoa industry is worth about $100 billion. West-African countries like Ghana and Ivory Coast have an aggregate market share of 60 percent of the industry. Consequently, Ivory Coast exported 1.8 million metric tons of cocoa in 2016. The cocoa trade in West Africa is escalating owing to the proliferating demand from EU countries, China and India.

The cocoa trade in West Africa is under insurmountable pressure as a result of the increasing demand, now peaking after six years of growth, according to the International Cocoa organization. Aggregate global production is at 1.9 million metric tons. Owing to the increase in supply to satisfy demand, the price of cocoa may be unpredictable for the time being; in Cameroon, the price of cocoa is 38 percent lower in some areas as a result.

However, despite the flourishing cocoa trade in West Africa, combatting child labor, exploitation of smallholder farmers and poverty are still paramount to ensuring the sustainability of the industry in the primary cocoa exporting countries: Nigeria, Ivory Coast, Ghana and Cameroon. Subsistence farmers also suffer from the combined effects of inefficient farming practices.

As a result, farmers are being provided with more skills training in Nigeria. With more than 33 million smallholder farmers in the region, it is vital for them to have more access to capital and markets. This could culminate in more agribusiness activities and self-sufficiency in this sector. The government is prioritizing the bolstering of the cocoa trade so that Nigeria can recover from its current precarious economic circumstance and emerge as the largest producer of cocoa in the world.

Ninety percent of coffee farmers still earn less than two dollars a day. Monitoring and introducing more transparency in supply chains will bolster the position of farmers. Uncommon Cacao, the International Cocoa Initiative and Cargill are cracking down on child labor in Ivory Coast. Fair Trade USA has been pursuing objectives central to the plight of smallholder farmers, while Fair Trade International is working intensively towards opening up more flexible avenues for fortifying the cocoa trade in Africa further.

Many of the world’s leading confectionery companies are also playing a pivotal role to protect farmers. The Nestle Cocoa Plan revolves around providing cocoa produced by sustainable means and protecting the integrity of smallholder farmers. The Internal Cocoa Initiative, an essential system that Nestle employs, is a new framework implemented to monitor supply chains. It involves the work of labor cooperatives and many auditing processes.

Considering the state of the cocoa trade in West Africa, the Ghana Cocoa Board is currently working towards locally producing more cocoa products within the country to maximize the full potential and value of output. Increased production within the country will also pump more jobs into the economy and provide more employment opportunities. Consequently, domestic demand will also increase in the process.

The African Union’s 2063 Agenda will pave the way for a more robust cocoa trade in West Africa. The plan is a long-term strategy that aims to galvanize existing frameworks of fair trade rules and regulations, improve education, training and employment opportunities and empower and economically mobilize individuals in need. The German government also unveiled a new plan with the African Development Bank built on the structural framework of the 2063 African Union Agenda.

With increasing levels of private investment and efforts to combat supply chain, transparency and accountability issues, the future of cocoa trade in West Africa is well safeguarded and looks set for prosperity.

Shivani Ekkanath

Photo: Flickr

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Shivani Ekkanath

Shivani is an Indian living in Singapore. Her hobbies are music, dance and writing. She loves reading about current affairs, political relations and other social issues.

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