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Niche market for Honduras cocoa

Honduran cocoa farmers are benefiting from having a direct link to international buyers (© Helvetas)
Honduran cocoa farmers are benefiting from having a direct link to international buyers
© Helvetas

While Honduras and the wider Mesoamerican region are thought to be the cradle of cocoa, production in the region is tiny in the global context. However the superior genetic quality of Honduran cocoa, which makes it perfect for high value confectionery, has prompted a partnership between 700 smallscale farmers and Chocolats Halba, a Swiss chocolate-maker. As a result, Honduran chocolate can be found on the shelves of one of Switzerland's biggest retailers, and farmers are, for the first time, benefiting from having a direct link to international buyers.

Cocoa production in Honduras is almost exclusively in the hands of smallscale farmers managing plantations of two hectares or less, mostly along the northern coast. Roughly 1,500 farmers in Honduras depend on cocoa as their main source of income, but finding a direct link to foreign markets has been a major challenge. Most farms are located in remote areas and education levels among farmers tend to be low, hampering communication with potential buyers in Europe. And while some larger farmer associations, such as the Honduran Association of Cocoa Producers (APROCACAHO), have had the skills to negotiate on international markets, small associations have struggled, often suffering from poor management and internal organisation.

Cocoa cooperation

In 2007, Helvetas, a private organisation for development cooperation in Switzerland, invited Chocolats Halba - a subsidiary of Coop, a major Swiss retailer - to join a pilot project to bring Honduran chocolate to Swiss consumers. Over the next two years, the project established direct links between the Swiss company and four farmer associations, whose 700 members were trained in improved, organic farming practices and fermenting and drying procedures.

Four farmer associations were trained in improved, organic farming practices and fermenting and drying procedures (© Hondudiario)
Four farmer associations were trained in improved, organic farming practices and fermenting and drying procedures
© Hondudiario

Project partner, APROCACAHO, carried out training through Farmer Field Schools, with the Honduran Foundation for Agricultural Research providing expertise in improved, environmentally sustainable cocoa-agroforestry systems. Other project partners included PYMERURAL, a regional programme for the competitive development of small and medium sized rural enterprises, and the Tropical Agricultural Research and Higher Education Centre (CATIE), which supported the training process through its Central America Cocoa Project.

Joining the project was an attractive option for the Swiss manufacturer, in expressing its corporate values as well as accessing high quality cocoa beans. Direct links between farmers and the cocoa industry are rare, with trade boards managing sales in major producing countries such as Ghana and Cote d'Ivoire. As a result, cocoa farmers tend to be very disconnected from the value chain. For Chocolats Halba however, being able to trace its cocoa back to the originating farms was important, making the supply chain more transparent and allowing the company to confirm its support for developing country farmers and environmentally sustainable farming.

Going for certification

APROCACAHO provided expertise in improved, environmentally sustainable cocoa-agroforestry systems (© Ingrid Fromm)
APROCACAHO provided expertise in improved, environmentally sustainable cocoa-agroforestry systems
© Ingrid Fromm

By 2011, a second phase of the project started, training the farmers and their associations in the required procedures to achieve organic certification and Fairtrade labelling. This includes production, post-harvest management, marketing and other administrative aspects, which, for sustainability, must be achievable in the long term by the farmers with minimal external support. Other developments in the second phase include a financial guarantee fund, which is enabling farmers to invest in organic production, thereby increasing the incentive for them to engage in the certification process. Planting of fruit and hardwood trees, including mango, rambutan, avocado and mahogany, within cocoa plantations has also been encouraged, to provide additional income and a retirement fund.

According to Rene Fajardo, President of Cooperativa San Fernando, one of the four associations, the project has brought significant gains for the farmers. "The quality requirements are high, but we've had the opportunity to learn and improve our cocoa drying and fermenting processes, as well as our administrative skills." Creating the supply system has required significant work from many parties, training the farmers, building partnerships with local institutions, and creating contracts and trade agreements. That investment, however, seems to be paying off. Farmers are now incorporating new knowledge that is helping them produce cocoa in a sustainable way, and have gained both a secure buyer and a better income for their cocoa beans. Chocolats Halba has, meanwhile, gained a high quality, fully traceable supply of cocoa that meets its social and environmental targets.

Written by: Ingrid Fromm, Bern University of Applied Sciences

Date published: November 2012

 

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