Brazil targets 13% of global cocoa market as study reveals

BRAZIL – Instituto Aya, an organization dedicated to supporting diverse and inclusive education, reported that Brazil aims for 13% of the global cocoa market creating as many as 300,000 jobs in the sector.

Based on the study, the country may potentially generate up to US$2.3 billion in cocoa-related revenue by the end of the decade.

The study found that Brazil, once the world’s leading cocoa producer in the 1980s, is the only country with the potential to reclaim a significant role in the global market while integrating all stages of the cocoa supply chain beyond the farm gate.

According to the study, Brazil holds a competitive edge across all stages of the chocolate supply chain, which could be leveraged to expand its global market presence.

Starting with agricultural inputs, the country benefits from the support of Embrapa and the Executive Committee of the Cocoa Plan (Ceplac), making it one of the world’s largest producers of cocoa seedlings and specialized machinery.

It also has extensive experience in agroforestry cocoa cultivation, a system that requires additional tree species to provide shade and shape the growing environment.

Another pathway for cocoa expansion could be its integration into forest restoration projects, including areas designated as permanent preservation zones (APPs) and legal reserves.

The Pará state government has already introduced regulations allowing cocoa cultivation within agroforestry systems for legal reserve restoration, but no federal law currently governs this practice.

On the production side, degraded pastureland presents a significant opportunity for expansion. Industry representatives have advocated that cocoa be classified as a priority crop under the government’s yet-to-be-launched Degraded Pastureland Conversion Program.

The already-established processing sector could expand with targeted investments as the country is home to major cocoa processors such as Barry Callebaut, Cargill, ofi (Olam Food Ingredients), and IBC, as well as smaller firms producing bean-to-bar and tree-to-bar chocolates with direct links to cocoa farmers.

“In the final stage of the value chain, chocolate manufacturing, Brazil stands out as both a major global supplier and one of the largest chocolate consumer markets,” the Aya and Systemiq report highlights.

However, a key challenge for cocoa expansion is limited access to credit. Data from the Central Bank cited in the Aya and Systemiq report indicate that only 0.05% of agricultural credit in Brazil is allocated to cocoa. In addition, producers face low productivity levels and persistent threats from pests such as witches’ broom disease.

To overcome the sector’s challenges, the study recommends creating favorable credit lines with lower interest rates, extended repayment terms, and grace periods. One proposal is extending the BNDES Climate Fund to the cocoa sector, which already offers such conditions.

Another suggestion is to encourage cocoa processors to engage in forward contracts with farmers, which would provide price stability and improve access to credit. Many small-scale producers struggle to secure financing due to collateral requirements.

Finally, the study underscores the need to strengthen rural technical assistance programs and increase investment in research and development.

These efforts should focus on mechanisation, such as pruning, harvesting, and processing equipment and biotechnological innovations to combat pests affecting Brazil’s cocoa plantations.

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