rainforest alliance and nyu stern school of business sustainable … · 2016-10-18 · rainforest...

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Rainforest Alliance and NYU Stern School of Business

Sustainable Cocoa Investment Challenge

It’s not easy for smallholder farmers to obtain loans by themselves, so by helping them

access the financing they need, we hope to improve their livelihoods, income potential and

encourage sustainable practices.

- Michelle Buckles, Director of Sustainable Finance, Rainforest Alliance

Smallholder cocoa farmers are the backbone of a global industry worth billions of dollars,

yet the vast majority of these farmers still live in extreme poverty, scraping a living from aging

cocoa plantations with declining productivity. In Côte d'Ivoire, supplier of 40% of the world’s

cocoa, yields are some of the lowest in the world, primarily due to aging trees, deteriorating soils

and disease. In the absence of long-term financing options to renovate and rehabilitate their

farms, many cocoa farmers are switching to other crops that provide better income opportunities.

Investing in sustainable cocoa farming is crucial to ensuring a steady cocoa supply for the

world’s chocolate industry, and to improving the livelihoods of cocoa farmers across

geographies.

Through its different programs, the Rainforest Alliance is working to revive the cocoa

industry in countries such as Côte d'Ivoire by providing capacity building services to farmers and

their cooperatives. This includes training farmers on farm renovation1and rehabilitation2

techniques (hereafter referred to as “R&R” or “rejuvenation”). In 2013, the Rainforest Alliance’s

Sustainable Finance Initiative embarked on a multi-phase project (the Cocoa Rejuvenation

Finance Project) aimed at designing and implementing a sustainable finance mechanism that

would enable smallholder cocoa farmers to access the financing and services they need to

improve and upgrade their plantations (Appendix 9).

The first phase of the Cocoa Rejuvenation Finance Project consisted of a feasibility

study conducted in Côte d'Ivoire during the summer of 2013 that demonstrated the business case

and viability for this project (Rainforest Alliance, Sustainable Finance Initiative, 2013). The

second phase of this project includes the design of a financing mechanism.

1 Renovation refers to the activity of replacing aging and underperforming tree stocks with new trees through replanting. 2 Rehabilitation refers to the activity of applying best agricultural practices on existing tree stocks with the objective to improve productivity.

http://www.rainforest-alliance.org/work/finance

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To begin the next phase of the project, the Rainforest Alliance partnered with NYU Stern

to create the Rainforest Alliance Sustainable Cocoa Investment Challenge. The Challenge asks

students at NYU to help the Rainforest Alliance develop an innovative financing mechanism to

provide long-term "rejuvenation loan packages" to smallholder cocoa farmers in cocoa producing

countries (Appendix 15). Loan packages, which will include a holistic set of products and

services, will be used by smallholder cocoa farmers to implement multi-year farm rejuvenation

projects aimed at improving the productivity and sustainability of their cocoa plantation.

Rainforest Alliance and Sustainable Agriculture

Rainforest Alliance

Since its founding in 1987, the Rainforest Alliance has worked to conserve biodiversity

and ensure sustainable livelihoods by transforming land-use practices, business practices and

consumer behavior. At the heart of the Rainforest Alliance’s approach is the understanding that

the health of the land is inextricably connected to the well-being of those who depend on it for

their livelihoods.

The Rainforest Alliance’s approach includes training and certification to promote healthy

environments and communities in some of the world’s most vulnerable ecosystems. Training is

provided by Rainforest Alliance project staff, consultants, agronomists, extension officers, and

led-farmers through workshops, manuals, and an online platform. The Rainforest Alliance’s

training helps farmers implement sustainable practices and obtain certification.

In order for a farm or forestry enterprise to achieve Rainforest Alliance certification, or

for a tourism business to be verified, it must meet rigorous standards designed to protect

ecosystems, safeguard the well-being of local communities and improve productivity. The

Rainforest Alliance then links these farmers, foresters and tourism businesses to the growing

global community of conscientious consumers through the green frog seal. The Rainforest

Alliance Certified™ seal is an internationally recognized symbol of environmental, social and

economic sustainability.

Sustainable Agriculture

Agricultural expansion is responsible for 70% of global deforestation, and is the single

greatest threat to tropical forests. In biodiversity-rich regions around the world, farms are often

responsible for soil erosion, water pollution and wildlife habitat destruction. Rainforest Alliance

certification encourages farmers to grow crops and manage ranch lands sustainably. Through the

standards developed by the Sustainable Agriculture Network (SAN), a coalition of nonprofit

conservation organizations, the Rainforest Alliance certifies farms based on the three pillars of

sustainability: environmental protection, social equity, and economic viability and recognizes

“that the well-being of communities and ecosystems is intertwined and dependent on

development that is environmentally sound, socially equitable and economically viable”. The

SAN standards include principles for (a) efficient and productive agriculture, (b) biodiversity

conservation, and (c) sustainable community development (Sustainable Agriculture Network,

2014).

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Rainforest Alliance and Cocoa Certification

The Rainforest Alliance has worked to strengthen the position of smallholder cocoa

farmers since 2006 by training farmers to conserve natural resources, secure a decent income,

increase productivity and gain access to the growing global market for sustainably produced

cocoa. With the support of locally based technicians and group administrators who help prepare

farmers for certification, 279,000 cocoa farms in 17 countries have achieved certification

(Appendix 2 and 3); through the Rainforest Alliance’s technical training programs, cocoa

farmers learn methods that increase efficiency, productivity and resilience. These farmers

safeguard the health of 1.3 million hectares of land and contribute to building a better economic

foundation for future generations (Sustainable Agriculture Network, 2014). As of 2013, cocoa

from Rainforest Alliance Certified™ farms accounts for 10% of the world cocoa market

(Rainforest Alliance, 2013).

Independent studies show that Rainforest Alliance training leads to increased yields and

income, along with many benefits for farmers, families and the communities that depend on

cocoa. In 2011, for example, certified farms in Côte d’Ivoire produced 576 kg of cocoa per

hectare compared with 334 kg/ha on non-certified farms (Committee on Sustainability

Assessment , 2012).

Rainforest Alliance’s Sustainable Finance Initiative

In 2012, the Rainforest Alliance sought to increase its value-add to producers and

industry by helping smallholders and small and medium sized enterprises (SMEs) increase

access to finance by establishing the Sustainable Finance Initiative. The initiative’s objectives

are three-fold: 1) to improve the economic sustainability of smallholders and producer groups

through access to financial literacy and business management education; 2) to increase access to

finance for smallholders and producer groups by promoting financial product innovation and by

linking them to social lenders and local financial institutions; 3) to increase understanding of the

economic benefits of sustainability for producers and the financial community.

While smallholder farmers in developing countries recognize the benefits of adopting

sustainable best practices involved in Rainforest Alliance certification, many find it challenging

to make the initial financial investment that certification and general productivity

improvements,require with limited access to financing. For example, SMEs may need to increase

pay to improve worker safety, build waste management systems, or install new technology to

obtain certification. “Small cooperatives rarely have that kind of money sitting in the bank, and

need to borrow the capital to make these investments,” says Michelle Buckles, Director of the

Sustainable Finance Initiative. Smallholder farmers often find it difficult to obtain loans by

themselves; the Sustainable Finance Initiative hopes to address this challenge by assisting small

and medium-sized enterprises access funding from financial institutions.

The Sustainable Finance Initiative provides support to certified producers and SMEs, and

those in the process of achieving certification, by helping to identify their financial needs,

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developing borrower profiles, providing business and financial management technical assistance,

developing supply financing mechanisms where necessary and linking producers and SMEs to

the appropriate financial institutions. It is important to note that while the Rainforest Alliance

does not lend money or assess credit worthiness directly, it makes introductions to lenders, who

then complete their own due diligence. The Sustainable Finance Initiative also works to educate

these institutions about the investment needs of sustainable producers and to influence the design

of financial products suitable for sustainable producers.

The Global Cocoa Market

Farmed on over 18 million acres (7.5 million hectares) of tropical land, cocoa provides a

means of livelihood for some five million farmers – 90% of whom are smallholders (<5 ha)

(Mars, Inc.). Cocoa is primarily grown in Africa, Asia and the Americas; however, Côte d’Ivoire

and Ghana account for 60% of the world’s cocoa supply (Green America, 2014). In 2013, Côte

d’Ivoire produced 1,449 thousand tons of cocoa and Ghana produced 835 thousand tons (ICCO,

2014).

Consumption of cocoa dates back 4,000 years to the pre-Olmec people of Mesoamerica,

and was historically used to create a ceremonial beverage. Introduced by the Spaniards,

chocolate gained widespread popularity throughout Europe by the mid-1600s (World Cocoa

Foundation, 2014). People around the world now consume over three million tons of cocoa beans

per year in thousands of different forms, creating an $83 billion global industry (Green America,

2014). The United States is the biggest importer of cocoa beans, and the second biggest exporter

of chocolate candy, after the European Union.

Currently, over 3.5 million tons of cocoa are produced annually (Fairtrade Foundation,

2013). While the World Cocoa Foundation cites a 3.1% annual production increase between

2008 and 2012, many predict supply growth will slow due to climate change and cocoa farm

deterioration, particularly in West Africa. At the same time, industry forecasts predict a 30%

growth in demand to more than 4.5 million tons by 2020, owing in part to the growing middle

class in emerging markets in China, Brazil, India, and Eastern Europe (Fairtrade Foundation,

2013). The supply gap may force prices to rise; in fact, many already predict cocoa prices to rise

close to 50% in ten years. In sum, productivity will have to increase in order to meet the world’s

growing demand for chocolate (Josephs, A Race to Satisfy World's Hunger for Chocolate, 2012)

(Appendix 6).

Historically, cocoa prices have been less volatile than large scale grains, such as wheat

and corn, and more stable relative to palm oil and rubber. Since 2013, however, cocoa futures

prices have been on a steady upward trend, increasing by 37% between 2013 and 2014 (World

Cocoa Foundation, 2014) (Appendix 4). The ICCO Daily Price closed around $2,900 per metric

ton on November 28th, 2014 (ICCO, 2014).

Cocoa Value Chain

Cocoa is an important export and cash crop for cocoa producing countries and it is also a

significant import for cocoa consuming countries, which generally do not have climates suitable

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for producing cocoa. To get from producers to consumers, cocoa beans travel along a complex

global value chain through farmers, cooperatives, buyers, shipping organizations, processors,

manufacturers, chocolatiers and distributers (World Cocoa Foundation, 2014).

The cocoa value chain also includes a wide range of value-add service providers, such as

certifiers, technical assistance providers, government services extension and financing partners

who support both growers and buyers in their daily activities (Appendix 6).

From the pod to the bar

Cocoa trees grow in hot, rainy, tropical climates, and they are generally located within

15-20 degrees latitude from the equator, ideally with lush vegetation to provide shade for the

trees. Farms tend to be two to four hectares and produce between 300 and 600 kilograms of

cocoa beans per hectare, depending on the country and region (World Cocoa Foundation, 2014).

The trees begin producing pods at peak production levels after five years and continue for about

ten years. A cacao tree typically produces 40 pods annually, and each pod contains between 20

and 60 beans—it takes approximately 400 beans to make one pound of chocolate (Rainforest

Alliance, 2014).

Most countries have two harvests per year, one peak harvest during the high season and

one second harvest during the low season. Once the cocoa beans have been harvested, farmers

pack the beans into boxes or leave them in piles to ferment and dry. After drying, farmers packs

the beans into sacks and sell them directly to local buyers or bring them to a cooperative. By

pooling the cocoa of many farmers, cooperatives act as an intermediary between farmers and

buyers and help farmers receive better prices. After cooperatives sell their cocoa to a buyer, the

cocoa is transported to an exporter.

The exporter inspects the cocoa and brings it to a port. The beans are then shipped to a

processing location, where they are checked by a buyer and then remain until needed by the

processor. Upon request, the manufacturer receives the beans, inspects and cleans them, then

roasts and grinds them into cocoa liquor. The processor then presses the cocoa liquor to divide it

into cocoa butter and cocoa cakes (cocoa cakes can be sold as is or ground into a powder). To

make chocolate, cocoa liquor is mixed with sugar, cocoa butter, and sometimes milk, and poured

into a conch that stirs the mixture under heat.

Challenges in the Cocoa Value Chain

The cocoa value chain faces a number of significant challenges that affect both growing

and selling the crop. Factors such as education, regulations and access to market information

significantly affect the price farmers receive for their crop (World Cocoa Foundation, 2014).

While smallholder cocoa farmers produce up to 90% of cocoa supplied to the global market, the

majority live in extreme poverty—which is partially attributable to smallholder farmers’ lack of

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market information and ability to negotiate. In Côte d’Ivoire, for example, 60% of cocoa farmers

live below the poverty line (Barry Callebaut, 2014). Other challenges include aging farmers—the

average age of farmers in West Africa is 51 years old—and child labor. An estimated 1.8 million

children work in cocoa production in West Africa (Green America, 2014).

Of greatest concern to the cocoa industry, however, is low productivity, attributable to

aging trees that are past peak productivity, pests and disease, and depleted soil fertility. In West

Africa, for example, 30-40% of crops are lost every year due to disease, and 30% of soils are

somewhat or highly degraded, resulting in weak trees and meager harvests (Barry Callebaut,

2014). Without access to adequate training and financing, smallholder farmers are unable to

curb tree stocks from deteriorating and to prevent yields from declining.

Landscape of Technical Assistance Provided to Farmers

Improving Agronomic Techniques through Farmer Field School

Recognizing the challenges farmers face and the impact their management decisions have

on the environment, Farmer Field Schools (FFS) were created in the 1980s to teach better crop

management practices. Since then, FFS have been established throughout Asia and Africa and

address a variety of commodities and topics, including cocoa, vegetables, rice, livestock, natural

resource management, climate change and social issues (David S et al, 2006).

Farmer Field Schools are a participatory training and adult education program that, on

average, consist of 20-30 participants that meet regularly during the cropping cycle. Taught by

trained facilitators, FFS aim to provide farmers with knowledge of the agro-ecosystem to help

them make better crop management decisions (David S et al, 2006). Agronomic techniques are

often passed down through generations of families and tend to be outdated. FFS teach best

management techniques for weeding, pruning, grafting, harvesting and fermenting, and

encourage farmers to experiment on their farms. The application of new techniques learned at

FFS has resulted in significant productivity increases for many farmers (IDH, 2013).

The Rainforest Alliance works in Côte d’Ivoire, Ghana, and various cocoa producing

countries in South America to help smallholder farmers improve their land management and

maximize yields through Farmer Field Schools. After FFS, many farmers often time go on to

seek Rainforest Alliance certification.

Improving Financial Literacy and Farm Management Skills

In addition to Farmer Field Schools, many firms and nongovernmental organizations

have developed training materials to increase financial literacy and management skills for

smallholder farmers. In cocoa, as well in other crops, smallholder farmers lack basic literacy and

numeracy skills that prevent them from properly managing their farms’ resources; quantitative

analysis is required to calculate yields, costs, and revenues, for example. Training materials that

address these issues teach basic financial concepts, such as budgeting, investment, and

management skills, like recordkeeping and land-use planning. Training often involves exercises,

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simulations and presentations that aim to teach farmers the value of implementing better

management practices on their farms (International Finance Corporation, 2013).

An example of a “farmer business school” in the cocoa sector can be found in Côte

d’Ivoire and Indonesia administered by GrowCocoa, and independently-run joint venture project

between Olam and Blommer Chocolate. The school addresses a number of topics, such as the

economics of food and cash crops and basic nutrition, and aims to help farmers understand and

anticipate yields (Nieburg, 2013).

Improving Access to Finance

Beyond improving smallholders’ agronomic techniques and farm management skills,

there is an increasing need to unlock smallholders’ access to finance to improve productivity. In

cocoa, this means unlocking farmers’ access to both short-term and long-term financing to revive

cocoa plantations through paying for inputs, planting materials, small equipment and additional

working capital.

Across crops and geographies, smallholders have a difficult time accessing finance. They

often lack credit history and collateral, and are therefore not ideal candidates for traditional

loans. In addition, financial institutions see investing in agriculture as risky, because crops are

unreliable, weather is unpredictable, and prices often fluctuate. For these reasons, smallholders’

access to finance has been fairly limited and even nonexistent.

In some cases, cocoa farmers and their cooperatives receive short-term financing from

buyers who are primarily motivated by their need to secure cocoa supply during harvest seasons.

These capital injections—in the form of trade finance, input finance or investment in capital over

a 6 to 9 month period—have created strong dependencies between the farmers and the buyers

providing these lines of financing. The key reasons cocoa farmers would sell to a specific buyer

are 1) the immediate availability of cash (even if this means selling at a price below market) and

2) the availability of credit for inputs (or subsidized inputs). In the latter case, inputs are provided

upfront by buyers, obligating farmers to deliver their harvest to these same buyers in order to

repay their debt. It happens, however that, farmers in need of liquidity—or of finding more

attractive prices elsewhere—sell their cocoa through other channels. This creates a constant

tension between cocoa farmers and cocoa buyers. On one hand, farmers are seen as “unloyal” to

the buyer providing the pre-harvest inputs; on the other hand, buyers are seen as “predatory,”

exhibiting a sense of ownership of their supply chain.

Industry stakeholders, development finance institutions, and socially-minded investors

are increasingly aware of the financing gap that exists in the cocoa sector and are increasingly

interested in finding financial solutions. Since 2009, access to finance has been on the agenda of

the World Cocoa Foundation’s (WCF) various programs as a tool to improve smallholders’

access to fertilizers and crop-protection inputs. Under its Cocoa Livelihood Program (CLP), two

microfinance institutions, Advans in Côte d’Ivoire and Opportunity International Savings &

Loan in Ghana, have provided short-term crop-protection and fertilizer loans to cocoa farmers

since 2012. They now reach several thousand farmers each year (World Cooca Foundation,

2012) (Appendix 5). Additionally, some social lenders, such as Alterfin and Root Capital in Côte

d’Ivoire, have made successful investments into large cocoa cooperatives in the form of

http://worldcocoafoundation.org/wcf-cocoa-livelihoods-program/

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investment loans to acquire or maintain equipment, and of trade finance, for cooperatives to

purchase the farmer’s cocoa at harvest.

Rainforest Alliance Cocoa Rejuvenation Finance Project

In 2013, the Rainforest Alliance’s Sustainable Finance Initiative embarked on a multi-

phase project, the Cocoa Rejuvenation Finance Project (CRFP), aimed at designing

and implementing a sustainable finance mechanism (hereafter “CRFP mechanism”) that

would enable smallholder cocoa farmers to access the financing and services they need to

upgrade their plantations and improve their productivity in a sustainable manner (Appendix 10).

The first phase of the project consisted of a feasibility study conducted in Côte d'Ivoire

during the summer 2013 that demonstrated the business case and viability of the project

(Appendix 1).

Results of the Feasibility Study

During the feasibility analysis phase, the Sustainable Finance Initiative produced a

flexible and robust investment decision-making tool3 based on farm-level economics that shows

the costs and benefits of implementing cocoa farm rejuvenation practices (Rainforest Alliance,

2013). The analysis derived from using this tool showed that long-term loans for cocoa farm

rejuvenation are theoretically possible with no loss of income to the farmers and can be repaid

through the resulting increase in productivity and farm revenue.

Building on the positive results of the study, the Sustainable Finance Initiative worked

closely with Dalberg Development Advisors’ Initiative for Smallholder Finance to assess the

amount of financing needed to implement cocoa farm rejuvenation at scale and to provide

thousands of “rejuvenation loan packages” to smallholder cocoa farmers in Côte d’Ivoire. The

portfolio level analysis showed significant potential impact of large-scale cocoa farm

rejuvenation on the Ivorian cocoa industry and economy at large. The analysis also demonstrated

the need for a large-scale financing program to deploy "rejuvenation loan packages” to a large

number of farmers. Assuming “rejuvenation loan packages” can successfully be deployed to

100,000 smallholder cocoa farmers in Côte d’Ivoire only, an estimated $200 million in capital is

required (Appendix 19). Such a widespread investment could lead to nearly $3.7 billion long-

term added value to the Ivorian cocoa industry over 10 years, according to Dalberg.

Next Steps

Based on the results of the feasibility study, the Rainforest Alliance is engaging with a

wide range of cocoa industry players, development finance organizations and technical

assistance providers. The Rainforest Alliance now seeks the help of NYU students participating

in the Sustainable Cocoa Investment Challenge to develop a practical mechanism to provide

long-term "rejuvenation loan packages” to smallholder cocoa farmers in Côte d’Ivoire and other

cocoa producing countries.

3 The framework of this tools is extensively described into the Feasibility Study Report published by the Sustainable Finance Initiative in 2013.

http://www.rainforest-alliance.org/publications/sustainablity-cocoa-production-cote-divoire

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The Rainforest Alliance envisions the CRFP mechanism to be an innovative and pre-

competitive4 financing mechanism through which debt and capital providers would work closely

with cocoa value chain participants to facilitate smallholder cocoa farmers’ access to

"rejuvenation loan packages.” These packages will contain a holistic set of goods and services

necessary to successfully implement multi-year rejuvenation plans. To mitigate repayment risk

and address the structural barriers5 inherent in the cocoa industry, these packages will be

designed as innovative blends of cash and in-kind loans to be repaid in cash and in crop delivery

by the farmers over one or several harvest seasons (Appendices 12 to 18).

Ultimately, the right CRFP mechanism will allow large scale debt and capital providers

to connect with smallholder cocoa farmers across geographies, providing them access to the

products and services they need to implement rejuvenation practices. The mechanism will also

provide a source of funding for all capacity building and technical assistance activities required

to implement long-term lending activities to smallholder cocoa farmers; it will offer an

innovative financing solution in a sector where many structural barriers have, until now, kept

smallholders from accessing rejuvenation finance.

4 Meaning that the mechanism will not give preference to one-buyer or the other and will benefit the industry at large. This also implies that the cost of setting up such a mechanism and its risk will be shared across the industry without penalizing one particular player. 5 Example of structural barriers are i) the specific structure of the national cocoa markets and their economics, ii) the remote location of cocoa

farms from the markets, iii) the fact that famers do not necessarily have bank accounts or access to established mobile banking systems, iv) social and/or cultural barriers in understanding borrower-lender relationship, etc.

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Appendices:

Appendix 1: Feasibility Study

Rainforest Alliance, Sustainable Finance

Initiative. (2013). Investing in Sustainability

and Productivity Improvements to

Transform Cocoa Production and

Livelihoods in Cote d’Ivoire. Available at

http://www.rainforest-

alliance.org/publications/sustainablity-

cocoa-production-cote-divoire

Appendix 2: Breakdown of Rainforest

Alliance Certified™ Cocoa Operations

Source: Rainforest Alliance, Oct 2014

Source: Rainforest Alliance, Oct 2014

Appendix 3: Cocoa Producing Countries

where the Rainforest Alliance works

Source: Rainforest Alliance, 2014

Appendix 4: Cocoa Price, London Cocoa

Terminal Market, in GDP/ton

Source: Barry Callebaut Annual Report 2013/14




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Appendix 5: Global cocoa production

(000 metric tons, 2011-2012)

Source: Dalberg Development Advisors, 2013

Appendix 6: Forecasted global cocoa

production in millions metric tons


Appendix 7: Cocoa stakeholders and their primary activities


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Appendix 8: Example of short-term input finance mechanism implemented in Cote

d’Ivoire under the WCF’s CLP Program

Please refer to p.7 of the IDH Growth Fund Presentation, available at:

http://www.idhsustainabletrade.com/cacao-growth-fundwcf

Appendix 9: Rainforest Alliance R&R Logic Framework

Source: Rainforest Alliance Sustainable Finance Initiative

Appendix 10: CRFP Project Phases


http://www.idhsustainabletrade.com/cacao-growth-fundwcf

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Appendix 11: Potential impact of rejuvenation on a farm (kg/ha cocoa yielded and year

after intervention)

Source: Rainforest Alliance Sustainable Finance Initiative, 2014

Appendix 12: Expected necessary steps to disburse “rejuvenation loan packages” to

farmers as part of the CRFP


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Appendix 13: Example of a farm-level rejuvenation plan (Illustrating Step 2 in Appendix

12)

The following tables were extracted from the investment decision making tool developed by the

Rainforest Alliance as part of the CRFP Feasibility Study. Numbers given as example only.

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Appendix 14: Example of a farm-level rejuvenation loan structure (Illustrating Step 3 and

4 in Appendix 12)

The following tables were extracted from the investment decision making tool developed by the

Rainforest Alliance as part of the CRFP Feasibility Study. Numbers given as example only.

Appendix 15: Expected composition of “rejuvenation loan packages” financed by

“rejuvenation loans” (Illustrating Step 5 Above)

Tra

inin

g Farmer training on best

agricultural practices and

rejuvenation techniques Before loan is disbursed to the farmer.

To be paid through financing mechanism directly to

service providers. Farmer financial literacy and

credit management training

Inputs

Planting Materials

When cocoa tree replanting is happening – based on

individual project plans.


providers or by farmers at delivery using cash loan.

Fertilizers Every year – volumes vary annually depending on

individual project plans.


input providers or by farmers at delivery using cash

loan.

Pesticides

Fungicides

Other inputs

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Ser

vic

es

Agronomic services related to the

utilization of inputs (e.g. spraying

of inputs)

Every year – as needed.


service providers or by farmers at delivery using cash

loan.

Agronomic services related to

rejuvenation practices

When cocoa tree replanting is happening.


service providers or by farmers at delivery using cash

loan.

Oth

ers

Additional labor As needed.


Appendix 16: Cocoa Cultivation Calendar

Activities Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec

Nursery setting

Planting

Pesticides

Fungicides

Fertilizers

Weeding -

Pruning

Main harvest

Small harvest Source: Rainforest Alliance, 2014

Appendix 17: Scope of Technical Assistance (TA) expected to implement CRFP mechanism


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Appendix 18: Farmer-Cooperative-Buyer traditional scheme and suggested options for

farmer loan repayment

Appendix 19: Estimated amount of capital needed to provide “rejuvenation loan packages”

to 102,500 farmers in Côte d’Ivoire


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Appendix 20: Examples of portfolio level analysis

Example 1

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Example 2

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References: Barry Callebaut. (2014). Cocoa Sustainability

Report 2013-2014. Retrieved from

http://www.barry-callebaut.com/documentation

Committee on Sustainability Assessment . (2012).

Rainforest Alliance Certification on Cocoa

Farms in Cote d’Ivoire. Retrieved from


alliance.org/publications/evaluating-rainforest-

alliance-certification-on-cocoa-farms-in-cote-

divoire

David S et al. (2006). A guide for conducting

farmer field schools. International Institute of

Tropical Agriculture.

Fairtrade Foundation. (2013, March 28). The future

of chocolate: why cocoa production is at risk.

Retrieved from The Guardian:

http://www.theguardian.com/sustainable-

business/fairtrade-partner-zone/chocolate-cocoa-

production-risk

Green America. (2014, October 15). “Big

Chocolate” brings in $83 billion per year. Where

does all this money end up? Green America.

Retrieved from

http://blog.greenamerica.org/2014/10/15/big-

chocolate-brings-in-83-million-per-year-where-

does-all-this-money-end-up/

Gro Intelligence, BBC & CDI. (n.d.). The

Distribution of Chocolate Profits.

ICCO. (2014, December 1). ICCO Daily Prices of

Cocoa Beans . Retrieved from International

Cocoa Organization:

http://www.icco.org/statistics/cocoa-prices/daily-

prices.html

ICCO. (2014). International Cocoa Organization.

Retrieved from http://www.icco.org/

IDH. (2013). Cocoa Farmer Field School in Cote

d'Ivoire. Retrieved from

https://www.youtube.com/watch?v=f3NHWiKlJ

MQ

International Finance Corporation. (2013). Working

with Smallholders: A Handbook for Firms

Building Sustainable Supply Chains. Retrieved

from

http://www.ifc.org/wps/wcm/connect/8dc562804

2112fdbba2fff494779b2ad/Handbook+-

+Working+with+Smallholders.pdf?MOD=AJPE

RES

Josephs, L. (2012, March 29). A Race to Satisfy

World’s Hunger for Chocolate. Wall Street

Journal. Retrieved from

http://online.wsj.com/articles/SB1000142405270

2304177104577310160997655178

Josephs, L. (2012, March 29). A Race to Satisfy

World's Hunger for Chocolate. Wall Street

Journal. Retrieved from

http://online.wsj.com/articles/SB1000142405270

2304177104577310160997655178

Mars, Inc. (n.d.). Cocoa Sustainability at Mars.

Nieburg, O. (2013). The farmer is a businessman

and we need to approach him as such.

Confectionarynews.com. Retrieved from

http://www.confectionerynews.com/Commodities

/The-farmer-is-a-businessman-and-we-need-to-

approach-him-as-such-GrowCocoa-

sustainability-director

Rainforest Alliance. (2013). 2013 Annual Report.

Retrieved from http://www.rainforest-

alliance.org/about/annual-report

Rainforest Alliance. (2013). Investing in

Sustainability and Productivity Improvements to

Transform Cocoa Production and Livelihoods in

Cote d’Ivoire. Retrieved from


alliance.org/publications/sustainablity-cocoa-

production-cote-divoire

Rainforest Alliance. (2014). Cocoa: The Food of

the Gods. Retrieved from http://www.rainforest-

alliance.org/work/agriculture/cocoa/food-of-the-

gods-infographic

Rainforest Alliance, Sustainable Finance Initiative.

(2013). Investing in Sustainability and

Productivity Improvements to Transform Cocoa

Production and Livelihoods in Cote d’Ivoire.

Retrieved from http://www.rainforest-

alliance.org/publications/sustainablity-cocoa-

production-cote-divoire

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