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Slavery claims leave bitter chocolate taste

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Author Topic: Slavery claims leave bitter chocolate taste  (Read 516 times)
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« on: April 13, 2009, 08:59:30 am »

Slavery claims leave bitter chocolate taste


By ROB STOCK - Sunday Star Times Last updated 05:00 12/04/2009

 There's a dark side to New Zealand's chocolate habit, in more ways than one.

The first is the growing share that high-cocoa dark chocolate makes up of the estimated $350 million to $400m of chocolate we consume each year, with a good deal eaten this Easter weekend as recession-struck households splash out on what remains a relatively cheap luxury.

That shift in tastes to darker, richer chocolate the 72% cocoa content Dark Ghana slabs are now Whittaker's biggest seller, while 70% cocoa Old Gold is Cadbury's fastest-growing line mirrors our increasingly sophisticated taste for everything from coffee and tea, to olive oil and wine.

It's the biggest trend in an industry which has seen sales hold steady, despite the economic downturn, leading to hopes of decent Easter egg sales, a market in which Cadbury boasts an 80% share. But, behind the dark sophistication of the products, lies the grim reality of the conditions in which West African cocoa farmers and their families live.

Child labour and slavery exist in the cocoa plantations of West Africa, and even where they are less prevalent for example in Ghana where Whittaker's sources all of its cocoa and Cadbury sources the bulk of its poverty persists for those at the bottom of the chocolate production chain, says Steve Knapp, of the Fair Trade Association of Australia and New Zealand.

It's a dark secret that the multi-billion chocolate industry has struggled with, even as pressure has mounted for a global fairer deal for growers.

The global chocolate industry got a huge shock back in 2001 when the United States Congress came close to approving funding for the development of "anti-slavery" labels on chocolate bars following credible reports of widespread slave-labour in the Ivory Coast cocoa plantations, which back in 2005 supplied about 40% of the world's cocoa.

That caused panic in the big chocolate companies like Hershey, Mars, Nestle and Cadbury's, which would have been forced to suffer the shame of having to continue selling chocolate with such labels.

Faced with that threat, the chocolate industry came up with the voluntary "Cocoa Protocol" which set out a timetable for concrete action to eliminate the "worst forms of child labour" not child labour itself by mid-2005.

The industry missed the deadline and was allowed a three-year extension, which also passed without the aims being achieved, say critics like the International Labour Rights Forum and the World Fair Trade Association.

As publicity mounted, fair trade chocolate brands, which guaranteed no child or slave labour were used in the production of cocoa, began to appear, and in March this year, Cadbury, one of the world's largest chocolate producers, broke ranks with the likes of Hershey, Mars and Nestle to start down the fair trade route.

It was an admission that the voluntary process had failed, said Barry Coates, executive director of Oxfam.

To be able to put a Fair Trade logo on their chocolate, a manufacturer must guarantee a minimum price (currently $US1600 a tonne) to the farmer, which provides fair and predictable compensation for the cost of production plusa "social dividend", a price that is sufficient for families to live, develop their communities and put their children through school.

Most of the time the world cocoa prices are below the minimum fair trade price, said Knapp (see chart). That leads producers to try to squeeze costs down, he said, producing fertile ground for abuses like child and forced labour.

A minimum fair price was doubly necessary because higher tariffs on the importing of chocolate rather than raw cocoa solids in many countries meant cocoa-producing countries could not add value to the raw material, locking their economic fortunes into the price they can get for their beans, said Knapp.

But though higher prices for farmers would seem to imply higher prices for chocolate eaters, Knapp is not convinced that is not necessarily true, and one New Zealand chocolate producer is out to prove it.

During a comparison shop at New World at Victoria Park in Auckland (see table), we found five fair trade brands on sale, including Cadbury's own Green & Black.

But while it, Cocoa Farm (cocoa sourced from a plantation in Australia), and the Swiss Cocolo and Maetrani brands, usually cost 5c-8.7c a gram, compared to the 1.9c a gram Whittakers and Cadbury charge, there is a home-grown fair trade chocolate-maker which is trying to foot it on price, as well as conscience.

Scarborough Fair, which is owned by a consortium of small, private investors in New Zealand and sources its cocoa from Peru, is aiming to foot it in the same large-format bar that has been so successful for Cadbury and Whittakers.

Though its bars are slightly lighter (180g compared to 250g), they take up the same footprint on the shelf and the price per gram is only 2.3c, compared to the 1.9c for the dominant players in the supermarket slab market, in which Cadbury has a roughly 70% share, followed by Whittaker's which claims roughly a 20% share.

We couldn't find any Fair Trade Easter eggs at the supermarket, and Scarborough Fair director Andrew Davidson said the supermarket chains had not committed to carrying them, and so Scarborough Fair, which sold eggs last year, didn't produce any.

Davidson said to make it big in the $67m New Zealand chocolate block market, a slab maker, regardless of whether it is fair trade or not, has to foot it on price, size and quality.

"The market is more price driven here," said Davidson, a former supermarket chief executive, "but it has been built around the 250g block.

"The rest of the world is at the smaller, higher quality end.

"What Scarborough Fair is doing is positioning our products in the mainstream markets," he said. "If fair trade is going to be a success, the real benefit has to be in not just making a statement in the marketplace, but by doing good for the growers, and the only way to do that is through volume."

That volume looks like it will soon materialise.

Cadbury has announced plans in the United Kingdom to convert its biggest-selling Dairy Milk range to fair trade, a move that is being enthusiastically welcomed by Cadbury in Australia and New Zealand, said Cadbury's New Zealand chief executive Matthew Oldham.

"People are becoming a lot more conscious of where the original ingredients are sourced and this is something Cadbury is conscious of."

Though New Zealanders lack the consumer awareness of the Brits, 42% of us say we would buy more fair trade if more were available, and the recognition of the Fair Trade label has jumped from just 2% in 2006 to 36% at the end of last year, though Fair Trade said retail sales were a mere $14.6m in the past year.

"We are rolling it out in the UK first, then we'll roll it out across the rest of the world," Oldham said.

"We have started here in New Zealand with initial discussions with fair trade and we want to move down that track."

It will not be an overnight shift though.

"We definitely intend to work towards fair trade in Cadbury in New Zealand, but it will depend on the availability of fair trade cocoa," Oldham said.

The truth was Cadbury could not go entirely fair trade immediately as there would not be enough producers around the world who qualified, he said.

The move was consistent with Cadbury's history, Oldham said. The Cadbury family were Quakers and were model employers during the British industrial revolution, setting up the town of Bourneville to improve the lives of its employees in the face of a society which brutally exploited the working masses.

And back in the 1990s, the Cadbury family took an anti-slavery stance and refused to buy cocoa from African countries where slave labour was the norm on cocoa plantations, said Oldham, though Knapp counters that merely avoiding the worst producers does not absolve companies, particularly the giants, of their ethical responsibility toward growers in the areas they have turned their backs on.

The Cadbury move may well turn out to be smart business.

Davidson believes the current financial crisis is creating a seismic shift towards what he calls "ethical consumerism", which will impact all manufacturers.

Whittaker's, still owned by the Whittaker family, is investigating following suit.

"It is certainly something we are involved with. We are members of the Confectionary Manufacturers Association of Australia and through them the World Cocoa Foundation which does a lot of good work in West Africa," said Whittaker's marketing manager Philip Poole.

As for going Fair Trade, it remains a possibility.

"It is something we will certainly look at, and certainly we don't condone in any way poor labour practices," Poole said.

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