Cocoa from the cacao tree (scientific name Theobroma cacao) is the main ingredient in the world’s chocolate.
Each year from October onwards, the ‘main crop’ cocoa season happens in Côte d’Ivoire, one of the world’s largest cocoa producers. This is when cocoa value chain stakeholders buy and sell cocoa beans at the government-set price, selling mainly to exporters. Later comes the ‘light crop’ season, when farmers generally sell their cocoa beans locally at lower prices.
Smallholder growers and agricultural small and medium enterprises (SMEs) in low-income countries, including in West Africa’s cocoa sector, currently lack adequate finance. In cocoa, for example, most farmers struggle to reach a living income. Women tend to own smaller farms than men and have less access to training and finance.
Filling this financing gap is crucial to improve economic opportunities for marginalised rural populations, especially for women. And it also helps to build more sustainable food systems, protect forests and biodiversity, and slow climate change.
Lending to agricultural SMEs is relatively high risk. As a social impact investor dedicated to supporting low-income and mainly rural communities, Oikocredit has learned to navigate these risks to better serve small-scale producers of crops such as cocoa and coffee.
Impact investing in these sectors can generate substantial social and environmental benefits. Well-managed social investments have potential to transform farmers’ livelihoods and to improve rural food security, opportunities for women and gender relations.
Oikocredit’s cocoa partners in Côte Ivoire
Cocoa is crucial to Côte Ivoire’s economy. As the main agricultural crop and export commodity, cocoa sustains about 1.5 million households among the country’s more than 28 million people.
Oikocredit works with cocoa producer cooperatives, SMEs and microfinance institutions (MFIs) active in the sector. Our finance helps Ivorian cocoa growers buy farm inputs such as fertiliser, hire seasonal workers at harvest time, and pay for transportation, drying and warehousing.
Among our partners is the Socak Katana cooperative, which comprises more than 3,000 Ivorian cocoa producers. Socak Katana’s cocoa exports are Fairtrade certified. To help prevent deforestation, the cooperative has mapped members’ plantations to ensure that none of its cocoa comes from a classified forest.
Another Ivorian partner we provide credit to is CAYAT, a cooperative partner since 2021. CAYAT’s 3,000-plus members in south-east Côte Ivoire grow Fairtrade- and UTZ-certified cocoa, coffee and cashews. Women’s empowerment is central to CAYAT’s mission, and its women’s association provides training for women farmers to play a greater role in the cooperative and helps women gain access to land and use the fair trade premium to finance their projects.
Among the CAYAT cooperative’s social and community projects, its plant nursery has supplied new cocoa bushes for hundreds of growers to renew their plantations. It runs a radio station, Radio CAYAT, whose local-language and French-language programmes promote children’s rights, gender justice and good agricultural practices. It has built two kindergartens, rehabilitated a primary school and furnished pumps providing clean water to farms and communities.
CAYAT participates in the International Cocoa Initiative’s Child Labour Monitoring and Remediation System, which helps prevent child labour in cocoa supply chains. It is also part of the ICO’s women’s economic strengthening programme, which promotes women’s autonomy and quality education for women.
Oikocredit’s partnership with Allah Bekele de Fresco (CABF) supports this Ivorian cooperative in procuring, processing, storing, transporting and exporting its members’ cocoa (and cashews). Founded in 2004 to fight rural poverty, and our partner since 2016, CABF unites several thousand smallholders in some of the poorest parts of the country and provides members with technical assistance, training and pre-purchase finance.
In addition, Oikocredit supports thousands of Ivorian, Ghanaian and Nigerian cocoa producers through its joint three-year investment with the impact investing platform Symbiotics in the Export Trading Group (ETG)’s trading company Agri Commodities & Finance.
ETG works to connect smallholder farmers with international markets. Among its projects, in Côte d’Ivoire it supports the Cocoa Fruit Lab – Côte Ivoire’s first wholly women-owned micro-factory producing sustainable cocoa, speciality chocolate and cocoa juice.
By promoting women’s participation in the supply chain as cocoa producers, juice collectors and chocolate makers, the Cocoa Fruit Lab supports female entrepreneurship. And it creates opportunities for women cocoa farmers to improve the quality of their produce and access higher-paying specialty markets.
This article was originally published by Oikocredit.