Assessment of environmental and social risks in the wider cashew sector one trading company specifically. The due diligence was performed within a 2 week timeframe, including review of company documents, desk research and field visits in two African countries.
Three Farmer Field Book projects on cocoa farming are ongoing in Côte d’Ivoire in collaboration with three large trade houses. A total of 1,075 cocoa farmers participate in these programs. They record data on their daily farming activities. The gathered data provide insight in the farmers’ farming practices, their cocoa production and productivity as well as their costs and income. Based on these data, recommendations can be made to improve farming practices. An important point of improvement, for example, is the use of fertiliser. Very few cocoa farmers in Côte d’Ivoire use fertiliser, and even fewer farmers use fertiliser with sufficient nitrogen content. As a result, soil nutrients are being depleted and cocoa productivity is low. This may push farmers to cut down forest to use its nutrient-rich soil for cocoa farming. Improved fertiliser use may help to avoid this by preventing soil nutrient depletion.
Agri-Logic provides the project partners with detailed analyses on the drivers of cocoa productivity and farmer income, in which activities as well as other characteristics are considered. Groups of farmers are compared to evaluate the impact of various project interventions aimed to benefit farmers. The analyses also shed light on social topics such as the gap to a living income, gender pay gap and the occurrence of child work and the risk of the occurrence of child work.
On request of Rainforest Alliance, Agri-Logic developed a tool for its cocoa certification programme that allows certificate holders to quickly and reliably estimate the gap to the living income of farmers in its supply chain. The model in the tool was developed from a large set of Farmer Field Book time-series data from Ghana and Cote d’Ivoire. The model relies on the very strong relationship between a farmer’s production level and income. Tool users need only add data on 5 variables for each farmer to the tool. The 5 variables are in most instances already available in existing datasets of the certificate holder and as such require no additional data collection. Reliability testing showed the tool to be highly accurate, erring no more than a single percentage point when assigning farmers to above and below the living income categories. This tool is currently being rolled by Rainforest Alliance to cocoa certificate holders who wish to report on living income development.
What are the impacts of certification for cocoa farmers in Côte d’Ivoire? In an impact assessment for Rainforest Alliance Agri-Logic compared certified cocoa farmers with non-certified farmers. The assessment focused on comparing key outcomes: production, yields, profitability and income at farmer level as well as comparing the driving factors behind these outcomes and the contribution of certification to these outcomes.
Key findings of the impact assessment:
- Certified farmers show a greater reduction in the use of biocides that fall in the Highly Hazardous Pesticides group as defined by the Pesticide Action Network.
- Certified farmers are more likely to use fertilisers. Their higher rate of savings provides them with a greater capacity to invest. Nevertheless, their choice of fertiliser material is equally skewed towards phosphorus-based products and they show a similar nutrient imbalance with far too little nitrogen being applied as do non-certified farmers.
- The hours of work on carried out by minors is significantly lower on certified farms, after controlling for other factors, certified farmers use 33% less working hours made by minors. While the data does not allow the distinction between child labour and child work as defined by the International Organization of Labour (ILO), we conclude that the risk at child labour is lower at certified farms.
- Certified farmers dedicate fewer hours to activities that are likely to result in better yields such as pruning, collecting diseased pods and pruning of shade trees.
- Certified farmers are more likely to use formal banking services and tend to have lower debt levels and greater savings than non-certified farmers. These are of course desirable phenomena in their own right, but do not make certified farmers more profitable. Consequently, the incidence of poverty, whether measured as the share of farmers living below the international poverty line or the living income benchmark does not differ significantly between certified and non-certified farmers.
- Cocoa production drives much of the income that farmers obtain and without meaningful changes in farmers’ nutrient management (fertilising and using an appropriate type of fertiliser) we do not expect to see much change in the reduction of poverty among cocoa farmers. This phenomenon helps to explain why despite years of investment in cocoa-growing communities change on the ground has been limited.
This value chain analysis was commissioned by CBI (Centre for the Promotion of Imports from developing countries) in order to identify the most promising product market combinations for processed fruit from Burkina Faso, Côte d’Ivoire and Mali.
Mango has been identified as the most promising product market combination.
Compared to other African mango origins, the focus countries have the following strengths, which can be leveraged to maintain and expand market position. This comparison provides a starting point for a regionally coordinated diversification and strengthening of the chain.
- Burkina Faso: large existing market share with track record of inclusiveness, organic agriculture and is suitable for markets demanding organic products and storytelling. Dried mango is the most promising segment.
- Côte d’Ivoire: well-developed agricultural economy and business environment in comparison to the other countries in the region, allowing it to potentially kickstart the mango processing sector relatively quickly. Côte d’Ivoire is a transport hub for landlocked neighbouring countries.
- Mali: opportunity to tap into premium niche markets for dried mango that are interested in storytelling about inclusiveness and environmental sustainability, some traction in purees and concentrates.
In order to increase the positive impact of the sector, key factors need to be considered for supporting companies and their enabling environment, which is true for all three countries: diversification, professionalisation, market growth and coordination.