Nestlé ESG Programme 'Boosting Cocoa Farmers' Income'
A Nestlé' income accelerator programme aimed at increasing income for cocoa farmers is increasing cocoa yields and helping cocoa farmers achieve a living income, research shows.
The initiative opened in 2022 and in that time has covered 28 cocoa farming cooperatives and 2,000 households in the Ivory Coast.
Its goal is to boost incomes for cocoa-farming families and tackle child labour risks. It offers incentives for enrolling children in school, adopting good agricultural practices, participating in agroforestry activities and diversifying sources of income.
An impact study from the Netherlands-based KIT Institute found it has also helped facilitate a surge in small-business investment in ventures such as agro-processing, boutiques, barber shops, and soap-making. It has also improved women's financial inclusion, by encouraging their access to financial backing for businesses through Village Savings and Loans Associations.
"The test-at-scale of Nestlé's income accelerator program has confirmed the initial results we saw in the pilot phase," says Darrell High, Global Cocoa Manager at Nestlé.
"The program is transforming the way cocoa is farmed by professionalising labour and ensuring trees are pruned. It is great to see that these professionally pruned farms deliver higher yields which translates to higher income for cocoa-farming families."
He added: “By putting the family at the centre of the program, we empower women who are supporting their children's education and are pursuing opportunities to diversify their household's income.
“We are continuing to gather feedback from the farming families, to learn and adapt the program accordingly. We are excited to have started to scale the program to 30,000 farming households and will continue to report on our progress."
This year the program is expanding to Ghana in 2024 and will include a total of 30,000 families. By 2030, it aims to reach an estimated 160,000 cocoa-farming families in Nestlé's global cocoa supply chain to create impact at scale.
Cocoa prices have tripled over the past 12 months, following ongoing bean disease in West Africa.Sugar prices are also on the up.
Cocoa farmers across West Africa have been hit by several plant diseases that are ruining crops on a vast scale and pushing up the global price of cacao – the raw material for making chocolate – to record levels.
Fungal black pod disease is just one of many affecting farmers, caused by months of wet weather. Another major problem in Ghana and Ivory Coast is cocoa swollen shoot virus, which is spread by insects.
Together, Ivory Coast and Ghana supply more than half of the world’s demand for cocoa.
Chocolate manufacturers such as Mondelēz International and Hershey have been left battling an ongoing rise in cocoa and sugar prices, and recently reported first-quarter results that reflected this.
Mondelēz – the maker of Cadbury and Oreo – have largely passed on the higher costs to consumers by raising prices.
But a recent surge in cocoa prices – allied to falling cocoa supplies due to drought and crop disease in the world's top cocoa producing countries – could spell further trouble.
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