The Regulation on Deforestation Free Products (EUDR) is planned to come into effect for cocoa from 30 December 2024. Ahead of its introduction, brands and countries worldwide have been working to increase their traceability efforts. These aim to help the region manage its deforestation governance and adhere to the EUDR rules.
About the Cocoa & Forests Initiative (CFI)
The CFI is a multi-agency program chaired by the governments of Côte d’Ivoire, Ghana and Colombia and 36 brands such as Mars Wrigley, Hershey and Nestlé. Active since its Frameworks for Action were signed by leading cocoa and chocolate producers and manufacturers at the UN Climate Change Conference (COP23) in 2017 it is helping to drive progress towards zero deforestation and meeting the requirements of the EUDR.
“There is clearly a movement towards fully traceable cocoa,” says Charles Snoeck, senior manager of cocoa at IDH, the social enterprise organisation that facilitates the Cocoa & Forests Initiative (CFI).
Taking cocoa from farms to supermarket shelves involves various industry players and a complex and intricate process with numerous stages. With the EUDR almost here, efforts are increasing to enhance ethical and sustainable policies and practices along the supply chain.
There are ongoing concerns about the EUDR, relating to how it will affect farmers and how the indirect cocoa supply chain challenges its effectiveness. That said, the EUDR’s anticipated arrival is now only months away.
Tracking cocoa from farm to factory
According to the World Cocoa Foundation, there are between five and six million cocoa farmers worldwide. However, the number of people who depend upon cocoa for their livelihoods was between 40 and 50 million, the research study exploring the factors influencing quality variation in cocoa stated. This makes traceability vital to farmers and to those who rely on it for work in the wider supply chain.
The IDH’s technical brief on cocoa traceability in West and Central Africa states that Cameroon signed a similar framework to the CFI programme in January 2021. The government, companies, farmer organisations and NGOs signed the Roadmap to Deforestation-free Cocoa. It aims to ensure the traceability of 100% of its cocoa supply from the farm gate through to the warehouse and exit port in Cameroon by the end of 2025.
The EUDR will build upon these programmes and initiatives when it comes into effect, putting these recommended requirements into law. “Brands have been vocal about the need for legislation to support a move towards transparency, and we have seen increased investment in farmer identification, farm mapping and traceability systems, from both private and public sectors,” says Snoeck.
Tough traceability tests
Implementing traceability throughout the cocoa supply chain has various obstacles that the industry needs to overcome to produce an effective and accurate farm-to-supermarket shelf journey. “Owing to the complexities in the supply chain and the size of the challenge, there is some concern over whether brands will be fully compliant in time,” Snoeck adds.
However, there are multiple traceability levels that start-ups and multinational companies can introduce into their supply chains. “Additionally, it is important to keep in mind that robust and credible traceability systems come at high costs and that there are different degrees of traceability,” says Snoeck.
According to the CFI, almost three-quarters (85%) of cocoa in CFI companies’ direct supply chains was traceable in 2022, and 339,928 had been mapped to enable traceability.
Yet it’s a different story when it comes to indirect supply chains. Instead of progressing tracking within the supply chain, there is a lack of emphasis on tackling traceability. Only 9% of the indirect cocoa supply was traceable to the farm in 2022, increasing slightly to 22% in 2023. Limited cocoa traceability throughout the indirect supply chain can result in potential environmental and human rights abuses, such as deforestation and child labour.
Utilising traceability systems, however, burdens farmers and cooperatives, who then face increased reporting. Issues relating to ownership over this responsibility and data sharing also remain problematic and unanswered.
There is also a critical gap in limited traceability at the farm level. A 2019 study on the Ivorian Supply Chain found that only 22% of Ivorian cocoa exports come from mapped farms by CFI companies. Data on individual farms is meagre, affecting the cocoa sector’s ability to attain full accountability throughout the supply chain for sustainability commitments.
Further, traceability itself is only a means to an end. “It needs to serve a purpose: building truly sustainable cocoa supply chains that ensure forests are protected and farmers earn a decent living,” adds Snoeck. In its discussions with public and private sector actors, the IDH prioritises ensuring it fully integrates this question of impact on farmers in the debate.
How countries are getting ready for the EUDR
In a United Nations Development Programme (UNDP) and Department of Forestry under the Ministry of Agriculture and Rural Development workshop on the EUDR preparedness check held in July, representatives focused on traceability, presenting some countries’ efforts to up their transparency and tracking throughout their supply chains.
Côte d’Ivoire and Ghana have developed national cocoa traceability systems. These include farmer IDs and plot polygons designed to bolster quality control, extension services and compliance checks through digitised information.
Peru’s agriculture sector has developed a national farmer registry, which includes GPS points for over two million registered farmers. These points aim to collect 500,000 polygons by December 2024 to support cocoa producers and the wider sector. Cocoa farmers use a self-description app to provide information on their cocoa crop’s land tenure, plantation year and production data to help develop traceability systems.
UNDP has also teamed up with Lavazza and Silva Cacao in Ecuador and Costa Rica to pilot sustainable, deforestation-free cocoa production. As part of the programme, they have developed a comprehensive plan to trace cocoa, introduced national no-deforestation policies and developed trade agreements to emphasise sustainable practices and produce fair prices.
Indonesia has created its SatuData platform, which provides various maps on land use and land change. These are connected to a new traceability web for palm oil. The platform is designed to create data and methodologies to track these factors along the supply chain and perform quality assurance and due diligence.
