Fair Trade Cocoa Cooperatives

Belize | Bolivia | Costa Rica | Dominican Republic | Ecuador | Ghana


Fair Trade Cocoa in Belize: TCGA (PDF)

The TCGA Cooperative
In today's world economy, where profits rule and small-scale farmers are left out of the bargaining process, prices are allowed to fluctuate rapidly and can fall so low that small-scale farmers are left without the resources or hope to continue. Fortunately, Fair Trade allows farmers to escape from this cycle and maintain their traditional lifestyles with dignity. Fair Trade ensures a minimum price of $.80/pound under long-term contracts, access to credit, and prohibits abusive child labor and forced labor. Fair Trade farmers are required to reserve a portion of their revenues for social projects, ensuring that community development and technical training for farmers will always be possible. Fair Trade also promotes environmentally sustainable practices such as shade cultivation, composting, and minimization of chemical inputs, ensuring that farmers use cultivation techniques that are safe for the environment and public health.

The story of Toledo Cacao Growers Association (TCGA) is a perfect example of how much Fair Trade makes a difference. The cooperative has about 126 members and is located in the Toledo region of Belize, which is the poorest in district in the country. It is also the southernmost district and has the largest population of Maya people (both Ketchi and Mopan). Agriculture is a central part of Belize's economy and citrus, bananas, sugar, rice, honey, and timber are its major crops. Though cocoa production is comparatively lower in amount, It is very important for TCGA's producers because it is their main source of income.

The Beginnings of TCGA
The cooperative was formed in 1986 in order to yield higher prices, improve living conditions, and help farmers increase the quality of their cocoa. TCGA's cocoa is grown organically and under a canopy of shade trees including valuable timbers of mahogany, cedar and teak. Farmers also use sustainable methods such as composting and typically grow a diversity of other food crops among their cocoa. These ecological methods have helped the community and the natural environment in many ways. Organic production keeps the river water pesticide-free. The preserved shade canopy makes the area a good carbon sink and supports a wide variety of natural species, including at least 187 kinds of birds. Crop diversity helps the cocoa resist disease. Most importantly, it provides farmers with their own food as well as alternate income sources.

Until the early 1990s TCGA's farmers earned enough from their cocoa to buy clothes, basic necessities and a variety of foods. They also worked hard to increase the size of their cocoa stocks because they expected prices to stay at good levels. However, the price of cocoa was suddenly cut in half between 1992 and 1993, falling below the cost of production. The cooperative was able to market their cocoa and obtain loans since they were well-organized . However, many farmers left their crops unharvested and some even left their farms to seek other work because they worried that the low prices would continue. Cayetano Ico, chairman of the TCGA in 1999, explains: " the price we could get for our cocoa was so low it was not worth harvesting. Many of us abandoned our trees. Some farmers went off in search of work on plantations. It was a very difficult time for us."

The Fair Trade Market
Fortunately, a chocolate company from the United Kingdom called Green and Black's offered a long-term contract for a stable supply of quality cocoa. They agreed to buy all the cocoa TCGA could produce at an above-market price. The cocoa was used to create Maya Gold Chocolate, which was introduced in March 1994 bearing the Fairtrade Mark, denoting Fair Trade certification in the UK. TCGA continues to be successful in the international market. According to the Fairtrade Labelling Organizations International, TCGA produced 28.6 tons of organic cocoa beans in 1998 and 22.2 tons in 1999, all of which were sold through the Fair Trade market. However, they are still getting market prices for their non-organic cocoa, which represents the majority of their output. The cooperative is working to increase organic yield by expanding their membership and technical training and is also looking for additional buyers.

Benefits of Fair Trade
Fair Trade income has benefited the cooperative as a whole in many ways, such as providing the funds for administrative staff and technical workshops on production, pest control, and shade management. In 1999, TCGA also paid to broadcast on a weekly local radio program, encouraging cocoa farmers to plant new cocoa trees and to establish nurseries. The long-term contracts Fair Trade offers have given the farmers the confidence to make long term plans to improve their production. Many who had abandoned their crops have now returned to their home communities to resume their traditional, sustainable lifestyles.

For many individual families, Fair Trade premiums have meant the difference between being able to send children to school and having to keep them at home to work. In the Toledo region, school can be quite expensive. Parents have to pay for uniforms, books, and food at school and children in the secondary grades must take a long bus ride to school. Anastasia, a mother of 7 children, said: "The oldest is already in high school. We hope that all the children will go to school because of the money we receive from growing cacao. Currently we have 2 to 3 acres and are planting more."

Future Plans for TCGA
Though Fair Trade has certainly improved the lives of TCGA's members in many ways, they still sell the majority of their crop to the conventional market, where prices are not high enough to allow them to save money or cover more than their basic daily expenses. As a result, they still have many challenges and needs that they cannot meet due to lack of funding. Many farmers are still rebuilding their farms after crop destruction caused by heavy rainfalls during Hurricane Mitch and all are faced with some loss from plant diseases. In addition, homes in the region are still without electricity so cooking is done over an indoor fire and light comes only from dim kerosene lamps. Some homes still have only thatched roofs and dirt floors, offering little protection from heavy weather.

The cooperative is working to increase Fair Trade revenues by expanding the farmers' technical knowledge and understanding of Fair Trade. As Cayetano Ico, Chairman of TCGA and farmer has stated, "Our objectives for the next years are to improve the quality of cocoa to satisfy market demands and to promote production of organic cocoa among our members, to promote education and awareness concerning the eco-system and to diversify production. Through the income of Fairtrade, we manage to solve specific quality problems and to improve the functioning of our organisation. We still need to learn a lot and gain experience in trading and marketing. Fairtrade gives us this possibility."

If TCGA's efforts are to be fruitful, demand for Fair Trade must increase at the same time. By buying Fair Trade chocolate and advocating for it in our communities and beyond, we can be true partners in the effort to bring cocoa farmers the additional Fair Trade revenues they need so much. Get involved today!


Fair Trade Cocoa in Bolivia: El Ceibo (PDF)

For the El Ceibo cooperative ("Central de Cooperativas Agropecuria-industrial") in the Alto Beni region in northeast Bolivia, Fair Trade has brought new independence and empowerment to farmers who were shuffled from one flawed and exploitative agricultural exporting system to another.

The Beginnings of El Ceibo
Alto Beni was colonized in the 1960's. The colonists were given small farms and had to join a government--run cooperative. When the government cooperative went bankrupt the cocoa farmers were left without marketing resources and had to turn to intermediaries to transport their cocoa along the difficult route to La Paz. In general, these farmers received unfairly low prices for their cocoa because they lacked knowledge of market prices and intermediaries often exchanged other commodities their cocoa instead of cash. In the 1970's, many farmers began to see that this system was problematic and they organized into their own cooperatives. In order to maximize their marketing power, some of the cooperatives united in 1977 to form El Ceibo, which joined the Fair Trade system in 1997. Today El Ceibo includes around 36 smaller cooperatives. The goals of El Ceibo are to improve the living conditions of the members and increase crop diversity and productivity.

Cocoa Production in El Ceibo
Cocoa farming is localized to the lower regions of Bolivia that have the tropical climate cocoa requires. It is an important crop for many farmers in these regions, accounting for as much as 80% of some farmers' incomes. Because cocoa prices have fallen, many of the farmers have been diversifying their production with crops such as coffee, citric fruits, bananas and dried fruits. El Ceibo is unique in that it was the first cooperative to convert to organic production, gain organic certification and process its own cocoa. About 65% of El Ceibo's production was certified organic as of May of 2000 and the cooperative has been working to increase that amount. The cooperative has developed its processing so well that the farmers are already exporting their own cocoa butter and cocoa liquor and selling their own chocolate domestically. Many members work in both the agricultural and processing sectors, giving the farmers extra opportunities to develop skills that will help them remain competitive in the market.

The Fair Trade Market
Sales through Fair Trade have been especially important to El Ceibo's Development. Fair Trade ensures a minimum price of $.80/pound under long-term contracts, access to credit, and prohibits abusive child labor and forced labor. Fair Trade farmers are required to reserve a portion of their revenues for social projects, ensuring that community development and technical training for farmers will always be possible. Fair Trade also promotes environmentally sustainable practices such as shade cultivation, composting, and minimization of chemical inputs, ensuring that farmers use cultivation techniques that are safe for the environment and public health.

El Ceibo's Fair Trade sales amounted to 55 tons of beans and 35 tons of processed products in 1998, and 65 tons of cocoa beans and 20 tons of processed products in 1999. The cooperative began selling to the US Fair Trade market in 2002, which will ensure a fair price for more of the cooperative's harvest. El Ceibo's farmers receive especially good returns on their crop because organic cocoa yields an extra premium in both the Fair Trade system and the world market and the cooperative does some of its own processing. El Ceibo's Fair Trade premiums have supported agricultural improvement and community development in many ways. For example, the cooperative offers incentives for organic production, has a fund for community projects and activities, and a Safety Fund for medical emergencies. The cooperative's success has been attributed in part to an exceptionally high level of solidarity, farmer involvement, and community spirit. Work sharing and mutual help are important, especially during the harvest season.

Future Plans for El Ceibo
The cooperative is still working to improve aspects of its cocoa processing, increase its domestic sales, and make its management and marketing more efficient. The farmers are confident that they will make progress because Fair Trade guarantees the basic resources they need. "We have a secure market and even if prices drop in other markets, we are paid what has been offered; the sale is secure," says Senobrio Nabia, a cooperative member. Bernardo Apaza Llusco, Commercial Manager has said: "El Ceibo is the name of a tree that grows steadily into a big tree and does not die. We took this name for our organisation: we will grow fast and will not die. Annually we produce about 400 to 500 tons of cocoa. We commercialise 70% of it and 50% of the cocoa is processed in our own factory in La Paz. At present we are diversifying the chocolate products and sell the new products on the national market."

Through Fair Trade these farmers have been able to break out of an exploitative agricultural system, take hold of their own production, increase their marketing power, and provide for their communities with dignity. However, the farmers and their community still face many needs and have much room for growth in front of them. To reach their goals, they need increased Fair Trade sales. Concerned consumers can play an essential role in making this happen one delicious bite at a time by buying Fair Trade cocoa and chocolate and encouraging more retailers and companies to offer it. Take action today!

This company uses cocoa from El Ceibo: Ithaca Fine Chocolates

Learn more...
Alternatives to 'Slash and Burn' Agriculture, Bolivia. Natural Resources Institute


Fair Trade Cocoa in Costa Rica: APPTA (PDF)

The APPTA Cooperative
The Asociación de Pequeños Productores de Talamanca (APPTA), located in southeast Costa Rica, was founded in 1987 by a non-governmental organization called ANAI that wanted to help farmers in the Talamanca area. The 1,500-member cooperative joined the Fair Trade system in 1997 and has about 1,030 cocoa-producers, with about 25% women. APPTA aims to improve the standard of living of the member families, use sustainable agricultural methods, increase quality, and diversify both agricultural and industrial production so that members have income sources other than agricultural products. All members have decision-making ability through the General Assembly, which is governed by a smaller elected Board. Community members participate through Producers Committees and a community Board.

Cocoa Production in APPTA
Southeast Costa Rica offers an ideal growing climate and enough rain to guarantee the necessary water supply. The majority of APPTA's members use organic methods and technical assistance programs have been set up to develop additional organic techniques and help more farmers learn to apply them. For example, APPTA has tried using a natural fungicide found in healthy, resistant cocoa pods to handle the common cocoa disease Monilia. Fair Trade provides added support for farming methods that are safe for the environment and public health by encouraging shade cultivation, composting, and minimization of chemical inputs, and offering a higher price for organic cocoa.

The cooperative has especially high yields since it is so large. In 1998, Organic production totalled 150 tons in 1998 and 140 tons in 1999 while conventional production amounted to 20 tons in 1998 and 15 tons in 1999. The cooperative has been as successful in its marketing as it has in its production. During the 1998 and 1999 production seasons, the co-op sold all of its conventional cocoa in the domestic market. The cooperative also sold all of its organic cocoa in the international market in 1998 while all but 20 tons were sold internationally in 1999. Because the farmers are united in a cooperative, they have the power to negotiate higher prices than they could on their own and are insured fair individual returns.

The Fair Trade Market
Until very recently, all of APPTA's sales took place without Fair Trade terms because the cooperative had a good contract with a US company for their organic cocoa and there was no demand for their conventional cocoa in the Fair Trade market. APPTA began selling to the US Fair Trade market in 2002. This was an important step in ensuring their continued success because only Fair Trade guarantees a minimum price of $.80/pound under long-term contractsand access to credit. Fair Trade farmers are also required to reserve a portion of their revenues for social projects, ensuring that community development and technical training for farmers will always be possible. APPTA has always directed its revenues towards administrative and agricultural programs and set up a fund for social projects when they began to sell their cocoa through the Fair Trade system.

Future Plans for APPTA
APPTA's advances into the Fair Trade market will clearly help the cooperative and the community to grow in many ways and realize more long-term benefits. However, in order to meet the needs of their families and community, APPTA's producers must expand their Fair Trade market. To this end, the cooperative is working to increase their Fair Trade cocoa sales and obtain Fair Trade certification for their bananas. APPTA's members clearly have a good understanding of how important these development would be. "The Fairtrade market...would contribute a lot to the improvement of the standard of living of all our associates and for the maintenance of the environment." Juan Carlos Barrantes, production manager APPTA. Consumers who want to help APPTA's producers and their community realize their vision for a better life can play a crucial role by buying Fair Trade cocoa and chocolate and encouraging more retailers and companies to offer it. Get involved today!


Fair Trade Cocoa in the Dominican Republic: Conacado (PDF)






The Conacado cooperative
The Dominican Republic is the home of the Conacado cooperative, which was founded in 1988, and joined the Fair Trade system in 1995. The Dominican Republic's tourism industry has increased significantly in recent years but this has not helped small farmers in the inner part of the country, many of whom are still struggling to survive. Even most of Conacado's small-scale farmers must also work on bigger plantations because their cocoa revenues do not meet their needs. As a result, farmers are limited in the time and money they can direct towards their own crops.

Conacado has about 9,000 members, who belong to 126 smaller cooperatives that are organized into regional groups called "bloques." Each bloque differs according to member needs, though each has a Board, Assemblies and Producer Committees. Each bloque also organizes exchange visits and workshops focused on agricultural and administrative topics. Local and national staff work with the Producer Committees to develop annual work plans, organize special activities, and evaluate loans. Conacado's goals are to generate work and income for disadvantaged groups, increase quality and productivity, foster direct trade relationships, and provide credit and technical assistance.

Cocoa production in Conacado
Cocoa accounts for 90% of the income members receive through Conacado. Other commodities such as bananas, citric fruits, potatoes, other vegetables and coffee are also produced for the local market and home consumption. Most of Conacado's cocoa has always been organic and shade grown. The cooperative is working to help farmers improve and expand these methods so that all cocoa will be certified organic. Fair Trade provides added support for farming methods that are safe for the environment and public health by encouraging shade cultivation, composting, and minimization of chemical inputs, and offering a higher price for organic cocoa.

The country's tropical maritime climate offers the perfect growing conditions for cocoa but also presents the constant threat of heavy weather influences, with more than one hurricane passing close by the island or hitting it each autumn. Farmers across the Dominican Republic were devastated in 1998 when Hurricane George destroyed countless acres of many important agricultural products, including the majority of cocoa plants and shade trees. The Dominican government had very limited funding for these farmers, most of whom do not have savings and face extreme difficulty securing loans. Commodity prices in the world economy just aren't high enough to support much more than day to day survival.

Fortunately the picture is a little brighter for Conacado's farmers because Fair Trade ensures a minimum price of $.80/pound under long-term contracts, access to credit, and prohibits abusive child labor and forced labor. Fair Trade farmers are required to reserve a portion of their revenues for social projects, ensuring that community development and technical training for farmers will always be possible. Fair Trade sales have provided the cooperative with enough income to meet basic expenses and invest in the future. After Hurricane George, the importance of Fair Trade revenues was clear. Isidoro de la Rosa, the director of Conacado, explains: "With the Fairtrade premium of 1999, we had planned to build some important roads, but with Hurricane George, which destroyed many of the farms and reduced our production with 70%, the General Assembly of members decided to use this money to 'clean up' the damaged farms and to create nurseries for new planting material."

Conacado's capacity for production has improved since its incorporation but remains at the mercy of tropical weather patterns. As a result of Hurricane George, total cocoa production dropped from 5,799 tons in 1998 to 1,912 tons in 1999 while total exports dropped from 3,724 tons to 1,555 tons across this time. On the positive side, Fair Trade sales rose from 88 tons in 1998 to 234 tons in 1999.

Benefits of Fair Trade
Fair Trade has helped Conacado's farmers in many important ways in addition to supporting rebuilding after Hurricane George. The cooperative has organized workshops to teach farmers how to improve fermentation techniques, expand sustainable growing methods, increase productivity, and participate more actively in the cooperative. In addition to these programs, Conacado facilitates many other projects, some with funding from other NGO's. One example is the Juntas Mujeres Campesinas, which is a group of three women's organizations that oversee the production of wine, bread, liquor, jam, chocolate and organic fertilizers.

Isidoro has expressed just how much the cooperative and Fair Trade system have offered to farmers and their communities: "In our country there was no tradition of fermenting cocoa. With the Fairtrade income, we were able to implement a fermentation programme to improve the quality and to convert our production to certified organic. This improved our position in the export-market. These days the competition for small-scale farmers organizations has become very aggressive, so only niche markets allow us to survive."

Future plans for Conacado
For Conacado, Fair Trade has paved the way for renewal, and continues to be a foundation of hope for continued growth. However, Conacado's members still sell much of their cocoa in the conventional market where prices have been below the cost of production for over two years. "We would like to see the Fairtrade sales increase to improve our market position," says Isidoro. Farmer incomes are sufficient to cover the basic costs of living but do not leave room for savings or extra expenses such as home improvements. Families with especially large numbers of children still can't afford to send them all to school. In addition, as late as 2000 many cocoa gardens were still covered with dense weeds, awaiting the funds for replanting.

Increased consumer demand is the key that will open up the Fair Trade market and bring Conacado's members the additional Fair Trade revenues they need so much. By buying Fair Trade chocolate and advocating for it in your local community and beyond, you can help build the Fair Trade market and ensure that chocolate is as sweet for the farmers as it is for you. Get involved today!

These companies use cocoa from Conacado: DAGOBA Organic Choclate, Equal Exchange, La Siembra Cooperative


Fair Trade Cocoa Farmers in Ecuador: MCCH


Cocoa Farming in Ecuador
Though small farmers are the foundation of the world economy, most do not participate directly in the marketing process or know whether they are getting a fair price for what they produce. This is because smallholders' farms are typically located far from marketing centers and they do not have the resources to transport their crops themselves. These farmers have no choice but to rely on middlemen who usually offer below-market prices and charge exorbitant fees for their services. As a result, small farmers receive just a fraction of already low world export prices. In addition, small farmer communities are generally located far from many essential social and educational services and have difficulty accessing them.

Jose Antonio Santos, commercial director of MCCH, explains: "When farmers harvest the cocoa they have to leave the village for a full day to sell their produce and buy basic products to take back home. But when they arrive to sell the cocoa, after walking for eight or nine hours, the traders tell them that the price has dropped. He'll say: 'I'll pay you half. If you don't want to sell, take the cocoa away.' The farmer has to sell, or return home with nothing for his family."

Luckily, things are different for cooperatives in the Fair Trade system such as Maquita Cushunchic Comercializando como Hermanos (MCCH) in Ecuador. Fair Trade has offered these farmers stability and self-sufficiency because it ensures a minimum price of $.80/pound under long-term contracts, access to credit, and prohibits abusive child labor and forced labor. Fair Trade farmers are required to reserve a portion of their revenues for social projects, ensuring that community development and technical training for farmers will always be possible. Fair Trade also promotes environmentally sustainable practices such as shade cultivation, composting, and minimization of chemical inputs, ensuring that farmers use cultivation techniques that are safe for the environment and public health.

The Beginnings of MCCH
MCCH was founded in 1984 and joined the Fair Trade system in 1985. MCCH, which means "Let's shake each others' hand and trade as brothers," was started by church communities who wanted to promote positive social change for marginalized populations and provide producers with a stable way to meet their basic needs. It encompasses four project areas: social development, education programs, building social and political influence to promote structural change, and socially oriented businesses.

MCCH Principles and Organization
MCCH is based on the principles of fair trade, transparency, honesty and participation. Its goals are to strengthen small-scale producers through increased commercialization, quality, [common cropping?], and direct exportation. Members participate in decision making through a monthly provincial assembly and meetings that are based in communities and buying centers. The cooperative also has a 6-person elected board with two producer representatives. MCCH holds Annual Assemblies to inform members of new developments in the organization as a whole. MCCH's membership includes around 800 small cocoa farmers whose cocoa is marketed through MCCH's export company Agroexportadora Maquita (Maquita). Most of the farmers also grow other crops for the local market and home consumption. MCCH has set up local farmer organizations for cocoa commercialization in some areas and sent its own buyer to purchase cocoa in other areas. In addition, MCCH announces its prices and uses an open system of weighing and grading the beans to ensure that farmers get a fair price.

Cocoa Production in Maquita
Though cocoa is not Ecuador's most important product, many families in Maquita depend on its export revenues and MCCH has become the second biggest cocoa exporter from the country. The cooperative's business success is especially noteworthy because Ecuador is facing significant economic challenges. It is one of the poorest countries in Latin America, has a largeforeign debt, and experienced a severe recession with currency devaluation in 2000. Maquita has worked hard to earn the trust of European manufacturers, who generally avoid direct trade due to the potentially high costs of late or failed deliveries. This has resulted in the establishment of direct long-term contracts, which are critical tto continued success for struggling producers such as these.


Maquita and the Fair Trade Market
Maquita is fortunate to have established many of their contracts under Fair Trade terms. Maquita members produced 1,000 tons of cocoa in 1999 and sold 65.4 tons at Fair Trade prices. Fair Trade sales have brought a significant increase in revenues for Maquita's members In 1999, Maquita members received an average of $1,156 per tonne, while conventional cocoa farmers received $965 per tonne. MCCH producers also receive higher proportions of the export price than conventional farmers: 70% versus 60%.


Benefits of Fair Trade
Fair Trade revenues have allowed Maquita to establish many important agricultural and social programs. "We don't just try to raise the income of the person, but we aim to raise their whole development," says Jose Antonio Santos. One exemplary program is the Farmers School, a special three-year training program designed to increase cocoa farmers' general knowledge, improve quality and productivity, and promote renovation. This seems to be very effective- total yields rose from 500 tons of cocoa in 1998 to 1,000 tons in 1999. Fair Trade premiums have also been used to support the transition to organic production, and this continues to be a priority for the cooperative. In addition, locally based social and educational programs focused on health care, gender, and the environment have been instituted. Here, Fair Trade has made a critical difference in the because it has brought social services to community members who previously lived too far away from such programs to access them as needed.


Maquita's members realize how Fair Trade has benefited farmers and their communities. Demesio Intriago, President of Association La Mercedes de Poza Honda (a MCCH beneficiary) said: "In our association we have learned a lot from MCCH. They didn't just come to buy cocoa, they have trained us as well. Recently our village received a visit from a doctor and this is appreciated very much, since this kind of service is hard to find in the remote area where we live."


Future Plans for MCCH
MCCH continues to expand its operations and reach for high levels of success. For example, MCCH is working increase its cocoa operations by forming a new organization called "Red Latinoamericana de Pequeños Productores de Cacao," which would unite cooperatives across Latin America and foster the transfer of technical and commercial knowledge. So long as they remain in the Fair Trade system, MC

Related issues: