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Chocolethics - the unfair global market in cocoa

Consider this when next you pick up a bar of Cadbury's Fruit and Nut or a Mars bar, conveniently sold cheaply at your supermarket checkout, the amount it costs you is the amount the cocoa picker gets for a whole day's work.

In 2014 total global sales of chocolate confectionery reached a staggering $100 billion - an increase of 20 billion from 2012 ( Euromonitor International). Very little of this money reaches the cocoa farmers and pickers who receive around 1.25 dollars a day for their efforts. They work a whole day for the price of a chocolate bar in the UK or USA.

While the profits of multinational chocolate companies have increased since the 1980s, the world market price for cocoa beans has declined by half with the cocoa producers receiving less and less of the massive turnover. Nevertheless, the cost of cocoa can fluctuate in an insecure market affected by weather and harvests. With an increasing demand for chocolate globally most recently chocolate producers have faced increasing commodity prices as demand outstrips supply, leading to different marketing strategies such as reducing the size of a bar or the number of chocolates in a box. At the other end, the cocoa producers are at the mercy of big market intermediaries. They have to accept the price offered, leading to economic insecurity and impoverishment for millions of cocoa farmers.

But much of the problem lies with the producers who have failed to invest in more efficient production or give support to struggling farmers. Disregard for the livelihoods of more than five million small-scale family farmers who grow 90% of the world's cocoa means that the industry may simply be unable to provide sufficient supply to meet the demand by 2020. Prices of chocolate are rising, but these farmers are not receiving any increased share.

Growers will receive just 3.5% to 6.4% of the final value of a chocolate bar - a fall compared with 16% in the late 1980s. The manufacturers' share has increased from 56% to 70% and the retailers' from 12% to 17% over the same period. Something is wrong in the way the markets work. They certainly don't lead to an equitable distribution of revenue and investment. Chocolate production has increased meeting ever-rising demand, a demand fuelled by the massive promotion of the end products, while little of this has filtered down to the producers. It is a distorted market with big intermediaries dictating terms to the farmers.

Meanwhile, massive amounts are spent on promoting chocolate. Last year (2014) Cadbury spent £7.5 million in a one week promoting its new Dairy Milk Ritz and Lu products in the UK. Mondelez International is little known in Britain but is now the multinational corporation behind Cadbury. Mondelēz International has annual revenue of approximately $36 billion and operates in more than 80 countries.

Chocolate production has yet to prove right for the struggling farmers, but is it good for the consumer? Some evidence suggests it is.

Diet is a crucial lifestyle factor involved in the genesis, prevention, and control of cardiometabolic disorders. Cocoa products containing flavonol have been shown to have the potential to help prevent cardiometabolic diseases. Several studies have suggested recently that chocolate consumption has a positive influence on human health - enhancing the bodies defences and cardiovascular function and preventing disorders.

Higher levels of chocolate consumption are associated with a reduction of about a third in the risk of cardiometabolic disorders. But what these studies do not do is promote excess chocolate consumption, especially where it is mixed with the possible harmful effects of excess sugar intake.

While chocolate consumption might have health benefits, it is bittersweet for the environment. With a lack of investment and support for good farming, increased cocoa production is an environmental threat with soil erosion, pesticides, deforestation and a danger to wildlife. It comes with a substantial cost in social terms and exploitation of farmers.


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