GHANA – Net incomes for cocoa farmers in Ghana have decline on average by 16% since 2020 pushing hundreds of thousands below the poverty line, a new report by charity firm Oxfam has revealed.
The impact has been disproportionately high for women whose incomes have declined by 22% during the period under review.
New analysis by the organisation reveals nine out of 10 cocoa farmers said they are worse off since the pandemic.
“Cocoa farmers work extremely hard, under gruelling conditions, yet can’t always feed their families,” said Oxfam International interim Executive Director Amitabh Behar.
Oxfam noted that income declines for farmers, most of whom now survive on just US$2 a day, was in contrast to the big revenue gains that top chocolate producers experienced during the same period.
Chocolate producers live off poor farmer’s sweat
According to the charity firm, the world’s four largest public chocolate corporations, Hershey, Lindt, Mondelēz, and Nestlé, have together made nearly US$15 billion in profits from their confectionery divisions alone since the onset of the pandemic, up by an average 16% since 2020.
The charity further alleges that these companies paid out on average more than their total net profits (113%) to shareholders between 2020 and 2022.
According to its analysis, none of the sustainability programs of 10 of the top chocolate manufacturers and traders operating in Ghana, all of which prioritize helping farmers produce more cocoa, achieved their stated goal of increasing cocoa production and, consequently, boosting farmer income.
In fact, the crop yields of farmers in the corporations’ supply chains declined by 25% between 2020 and 2022, implying that farmers earned less during that period.
In response to the claims, Lindt & Sprüngli said it has invested CHF 18.6 million (US$20.7m) in cocoa sustainability programs in 2021 and the Lindt Cocoa Foundation contributed an additional CHF 2–3 million annually in investments for farmers and communities.
“Chocolate giants need to put their money where their mouth is,” said Behar. “. Without fair pricing and living incomes there will never be such a thing as ‘sustainable’ or ‘exploitation-free’ chocolate.”
Ghana produces around 15% of the world’s cocoa beans but receives only about 1.5% ($2 billion) of the chocolate industry’s estimated annual worth of US$130 billion.
Behar now wants chocolate corporations to close the living income gap for farmers “by significantly increasing farmgate prices paid to farmers, and mitigate the impact of inflation on the rising costs of farming inputs and equipment.”