Cadbury’s answers concerns about its Cocoa Partnership

We were a little sceptical earlier today when we reported on Cadbury’s Cocoa Partnership.

We’re pleased to say Cadbury answered our concerns - which is the first good sign as difficult questions can often go unanswered.

So, we wanted to know why Cadbury aimed to help farmers increase their incomes by increasing and improving their yields - why not go down the Fairtrade route?

‘The first thing to say is that we share the aims of Fairtrade - increasing the economic and social well-being of farmers and farming communities. Our approach is a little different; we aim to reach all 720,000 farmers in Ghana, some of whom do not have access to the infrastructure and cooperatives required in the Fairtrade model.’

‘The issue for Ghanaian farmers is not price - Ghana cocoa sells at 10 per cent above the market rate because of its high quality - and this is above the Fairtrade floor. The real issue, which is why we've built the programme as we have - is productivity and volume. Ghanaian farmers earn a premium price for their cocoa (and they also receive 72 per cent of the price that we pay for the cocoa compared to as little as 25 per cent in some other markets) the issue is that they are not producing enough to make a decent living from cocoa alone.’

‘We're focusing on helping farmers in two ways: being more productive on their farms so they can sell more premium price cocoa, and introducing new and complementary income streams, e.g growing peppers and coconuts that are actually beneficial for cocoa. We're also focusing on the wider farming communities, and will be investing is social projects such as water wells and education in order to address the sustainability of cocoa farming in a holistic way.’

When we heard Cadbury’s was going to kick start new rural businesses partly through microfinance - basically offering small loans - alarm bells rang.

‘Farmers are at the heart of all our programmes. We will therefore build the programme to ensure that the repayment of loans are structured in a way that genuinely benefits the farmers in the long run. To do this we will input and advice from the farmers themselves - who will be represented on the local boards - and our NGO and development partners.’

As the details of the finance projects haven’t been finalised, we hope Cadbury’s may consider that as it ultimately profits from the end result it could take responsibility to cover the start up costs. We know they’re not a charity, but something about a large company offering loans to their small-scale producers, still sits uneasy.