AS YOU CAN IMAGINE, THIS IS A VERY WIDE TOPIC WITH MANY IMPLICATIONS, SO FOR BREVITY, I HAVE CHOSEN TO CONCENTRATE ON JUST THE ONE COMMODITY HERE… Cocoa…as I strongly suggest the upcoming EUDR has been on the mind of the trade and very relevant to the rise in prices seen throughout 2023 and now into 2024. Data from 20215


shows that the EU is


the world’s largest importer of Cocoa beans at 56% with the Americas accounting for 17% and Asia for 26%. Approximately 70% of the world’s Cocoa beans come from four West African countries – Ivory Coast, Ghana, Nigeria & Cameroon 6


. Thus, we can see how


big an international impact EUDR will have…and is already having, when over half the world’s Cocoa is imported by the one grouping, the EU, and their use of EUDR legislation.


So…I have been researching the response from some in the Cocoa industry to EUDR…and to be honest, it seems to be that at such a late stage, a sense of panic and chaos is out there…with concerns as to whether the EU will have enough Cocoa in 20257


. Additionally,


questions are being raised as to what will be the status of older harvests in warehouse & will certification schemes such as Rainforest Alliance have a role now that due diligence will become mandatory. One sustainability advisor described Cocoa as ’…under the kosh…’ and that we could see a two-tier system developing with EU market compliant Cocoa trading at a premium…a significant premium…to non- compliant Cocoa. Additionally, with Cocoa grown internationally mainly in family smallholdings, unlike the others on the EUDR list of commodities, small- holder Cocoa farmers are being scrutinised like never


5 www.cbi.eu 6 www.statista.com 7 www.confectionarynews.com 5th


Feb 2024


before, something they have never experienced nor necessarily have the means of coping with. Then there are the rights of indigenous people to consider, which EUDR may be seen to be cutting across as inspectors could go as far as seeking to enter the homes of indigenous farmers and all the implications, post-colonial and otherwise, that may have. Many of these same farmers lack the skills to fully complete the documentation necessary to be EU compliant, thereby marginalising and affecting the price they receive for their Cocoa. Finally, coming from some of the Cocoa market chat pages which I’ve seen, there is a seeming disconnect between regulators and the trade with the trade citing a lack of clear guidance from the regulator as well as a lack of understanding of the Cocoa supply chain. Some have even mentioned how Cocoa could become ‘… de-commoditised…’ because of these new Rules… and that is a whole can of whatever, that I do not wish to open right now.


I would just like to finish on this thought, though Cocoa and its chocolate products hardly impact the Consumer Price Indexes of many major countries, there is more to inflation than just how it rates as a percentage. There is the public, the consuming public’s perception of price rises and the shrinkflation already seen in chocolate products. If you thought we’d already seen a lot of this, perhaps it would be best prepared to see a lot more. At its most excessive, it may be that we see Cocoa go the way of lobsters, oysters and foie gras. Originally, a poor man’s food that became a luxury. We are far from that right now… but it is worth remembering…and considering.


Eddie Tofpik E: eddie.tofpik@admisi.com T: +44(0) 20 7716 8201


AT ITS MOST EXCESSIVE, IT MAY BE THAT WE SEE COCOA GO THE WAY OF LOBSTERS, OYSTERS AND FOIE GRAS.


7 | ADMISI - The Ghost In The Machine | Q1 Edition 2024


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