Chocolate Is Sweet, but Chocolate Policy Would Be Sweeter



Chocolate is to Valentine's Day as turkeys are to Thanksgiving: most people find it inconceivable to celebrate without them. This very popularity has doomed them to becoming commodities—with all the implications that go along with industrial production.

Now that we are beginning to think much more about where our dinner comes from, why not the treats of life as well?

Cacao is grown exclusively in equatorial climates, so the raw materials for chocolate come from a limited number of countries. Tiny Cote d'Ivoire is responsible for over one-third of the world's production; another 30 percent of global supplies come from three of its West African neighbors: Ghana, Nigeria, and Cameroon. Just 11 percent comes from the Americas—and all of that from Central and South America.

Last week cocoa prices reached their highest levels in 30 years as supplies became hostage to Cote d'Ivoire's presidential politics.

Unsurprisingly, the cocoa-processing industry is also highly concentrated and increasingly driven by large-scale production. Three major agribusiness companies, Archer Daniels Midland (ADM), Barry Callebaut, and Cargill, are believed to process about 40 percent of global cocoa beans. The chocolate manufacturing industry is also quite concentrated: the top 10 chocolate manufacturers account for more than 40 percent of global chocolate sales.

Last week cocoa prices reached their highest levels in 30 years as supplies became hostage to Cote d'Ivoire's presidential politics. President-elect Alassane Ouattara declared a month-long export ban to stop revenues from reaching his rival, incumbent president Laurent Gbagbo, who has refused to concede that he was defeated in November 2010 elections or to relinquish power. Cargill, a major buyer of the country's crop, said it had temporarily suspended cocoa bean purchases from the country. ADM is considering a similar move.

What does this mean for consumers in North America and Europe? You'll soon be paying more to satisfy your sweetheart's yearnings.

But the real issue is whether we pay "enough" for the products normally. No farmers get rich growing cacao. World Wildlife Fund estimates that there are 5 to 6 million cocoa farmers worldwide producing 3 million tons of cocoa. Child labor is common, especially in Cote d'Ivoire. Nearly all of the processing, marketing, and packaging—the points where the price gets marked up—occurs in the North American or European countries where the products are consumed. That means farmers are compensated for their commodity products only, unless they produce the coveted criollo cacao bean, the rarest and most expensive cocoa on the market. Accounting for just 5 percent of total production, it is native to Central America, the Caribbean islands, and the northern tier of South American states.

A few months ago I met a man representing Cordillera, a Colombian cacao company that has a unique niche: not only do co-op members harvest the beans, but the chocolate is actually produced in Colombia. In other words: the workers, not the middlemen processors, get more of the money. And the company's chocolate was recently certified Fair Trade.

Processing at point of origin seems like such a great idea that you'd think more companies would be doing it. But our federal trade policy, it seems, makes processing at point of origin difficult—unless they're Colombian. U.S. policies toward Columbia actively encourage trade in value-added products that aren't drug-related. Chocolate produced in other cacao-producing countries, meanwhile, would be subject to a high import duty.

And now for the most important part—to me, anyway: how did the chocolate taste? I've tried a lot of higher-priced Fair Trade chocolate and, well, the quality can be inconsistent. Like coffee, chocolate processing can be done poorly—especially where drying and storing processes are uneven or lacking climate controls.

This chocolate was different, though. This was delicious.



I'm proud to share that officially as of today, our chefs at Bon Appetit Management Company are now baking with this chocolate—making their brownies, cookies, and novelties like the strawberry-chocolate stilettos shown here. We're buying in huge, food-service-sized quantities, and, hopefully, growing the market so it will be viable for direct-to-consumer sales in the near future.

However, the more I learn about chocolate and how difficult it is to get the ethical- and good-tasting stuff into distribution channels, the more I want to focus on the trade policy issues. The Ghanaians and Nigerians deserve the same opportunity.

For my sweetheart, I've bought several bars of Fair Trade chocolate I haven't tried in a while, for another comparative taste test. The more producers we can find to support, the better.