Bitter Chocolate

Cocoa Prices – The Continuing Saga

Michael — Tue, 09 Mar 2010 23:22:18 +0000

The roller coaster of cocoa prices continues. Since the December 16 high of $3,636/ton, cocoa prices have dropped by almost $600/ton as measured by the ICCO Daily Price. There hasn’t been much in terms of news that might warrant this decline. Yes, production in the current year is higher than previously expected, but the surplus [...]

Cadbury Announces Plans for first Social Premium Disbursement

Michael — Wed, 03 Mar 2010 17:53:22 +0000

Cadbury, the latest convert to fairtrade, announced on Monday its plans for disbursing the first installment of its social premium. The funds, £500,000 ($751,215), will be invested in projects determined by the farmer cooperatives that supply the cocoa. One of the beneficiaries, the Kuapa Kokoo cooperative, will use its share to improve health services for [...]

Some Background on the Ivorian Crisis

Michael — Mon, 22 Feb 2010 22:32:33 +0000

When Ivorian President Laurent Gbagbo dissolved that country’s government and electoral commission on February 12, he created the latest roadblock in the long and difficult road to elections. The outcome was predictable. The elections, already postponed six times to March 2010, now are even father off. Even more disturbing was the dissolution of the Electoral [...]

Sierra Leone Becomes Fairtrade Producer

Michael — Tue, 16 Feb 2010 23:14:54 +0000

Divine Chocolate, my favorite chocolate maker, has done it again. They have just ordered the first fairtrade cocoa to come from the West African Country of Sierra Leone. Eight years after the end of its brutal civil war, with its economy still recovering, the farmers belonging to Kpeya Agricultural Enterprise (KAE) will enjoy the benefits [...]

Invisible Hand Is Confused

Michael — Fri, 12 Feb 2010 18:09:28 +0000

For anyone believing in the power of markets to accurately predict the future, this week was a challenge. On Wednesday, Business Week reported that cocoa prices were dropping on “concerns supply will outpace demand.” Cocoa butter has been piling up in Europe with stocks reaching 50,000 tons. Inventories in NY are rising as well. Finally, [...]

Green & Black’s Goes All Fairtrade

Michael — Wed, 03 Feb 2010 22:44:37 +0000

Green & Black’s has just announced that it will source all commodities from fairtrade suppliers. That’s wonderful news and a boost to fairtrade producers worldwide. In 1994, Green & Black’s introduced the first fairtrade chocolate bar, Maya Gold, to the UK and later to the world. The beans for that bar are sourced from the [...]

Nestlé lusts after Hershey

Michael — Tue, 02 Feb 2010 20:50:20 +0000

It’s merger time in chocolate land. Now that Kraft has swallowed Cadbury, in effect outbidding the Hershey/Ferrero odd couple, Hershey itself is little more than an ant at the candy company picnic dominated by Mars/Wrigley, Kraft/Cadbury and Nestlé. And Nestlé feels a little piqued having been pushed to third place. What to do? Buy Hershey [...]

Graphs of the Cocoa Economy

Michael — Sat, 23 Jan 2010 17:22:30 +0000

I’ve just created a new page for various graphical representations of the global cocoa economy. Check it out. Just click the “Cocoa & Chocolate Graphs” in the sidebar to the right.

Kraft Swallows Cadbury [Updated]

Michael — Tue, 19 Jan 2010 16:54:50 +0000

Well, it is done, mostly. After opening its mouth a little wider than during its first attempt, Kraft is poised to swallow British chocolate maker Cadbury. Kraft had to increase its offer from 761p to 840p per share and add a 10p per share dividend. Last night, Cadbury’s chairman Roger Carr agreed to recommend to [...]

Chris Wheal’s take on Fairtrade Kit Kat

Michael — Mon, 18 Jan 2010 17:22:25 +0000

Check out Chris Wheal’s take on Nestlé’s decision to use fairtrade cocoa for a small part of its Kit Kat production.

Ghana Increases Producer Price Again

Michael — Tue, 12 Jan 2010 19:57:39 +0000

My first post in the new year reports some good news for Ghanaian cocoa farmers. On January 8, Ghana’s Cocoa Board increased producer prices from G¢2208 ($1,530) to G¢2400 (1,663) per ton. Continuing high world market prices and the threat of increased smuggling to the Côte d’Ivoire are obviously factors behind this move. Alhaji Alhassan, the [...]

A Child Labor Update

Michael — Wed, 16 Dec 2009 23:54:33 +0000

In late September, the Payson Center at Tulane University released its third annual oversight report on efforts to eliminate the worst forms of child labor (WFCL) in the cocoa sectors of Ghana and the Côte d’Ivoire. Overall, the report takes a positive point of view. But hidden in various parts of the report remain serious [...]

UK’s Kit Kat to go Fairtrade

Michael — Thu, 10 Dec 2009 20:14:54 +0000

Nestlé, the global food giant, announced that, starting in 2010, its Kit Kat bar in the UK will be made with fairtrade chocolate. In doing so, Nestlé is following the example set by Cadbury earlier this year. According to the BBC, Nestlé sells about 1 billion Kit Kats a year in the UK. The beneficiaries [...]

The Sharks are Circling Cadbury

Michael — Tue, 08 Dec 2009 23:23:07 +0000

Ok, I’ve been rather quiet on the Cadbury story since it first broke some weeks ago. Here’s a quick recap. Kraft Foods made a takeover bid for Cadbury offering some $17 billion for the British company. Cadbury was quick to reject the offer as too low and its CEO seemed eager to preserve the company [...]

Ivorian Harvest Much Better Than Expected, So Far…

Michael — Tue, 24 Nov 2009 01:47:39 +0000

News of the decline of Ivorian cocoa production might be premature. I have reported earlier that a consensus estimate put Ivorian output for the current cocoa year at 1-1.15 million tons, quite a bit below the 1.4 million tons the country had achieved only a few years ago. But that consensus is no longer [...]

More Bonuses for Ghanaian Cocoa Farmers

Michael — Thu, 19 Nov 2009 03:34:18 +0000

COCOBOD, the Ghanaian cocoa board, has announced another round of bonuses for cocoa farmers. This time, the total bonus amounts to GH¢25,369,862.50 ($17,887,263). That translates to $1.76 per bag of cocoa. As usual, the monies will be distributed to the 26 licensed buying companies which will then distribute funds to the farmers on the basis [...]

Cameroon Farmers Hoard Cocoa, Get Higher Prices

Michael — Wed, 18 Nov 2009 15:19:18 +0000

Reuters reports that Cameroonian farmers have held back some of their cocoa from the market in order to push prices higher. As a result, prices have increased from CFAF1,150 ($2.66) per kilo in October to CFAF1,375 ($3,18) per kilo in November. Members of one cooperative report marketing only about a third of their crop. The shortage, [...]

Indonesia Contemplates Export Tax on Cocoa

Michael — Wed, 18 Nov 2009 03:17:58 +0000

It’s the age old story that pits local processors against exporters. The Indonesian Cocoa Processing Association can’t get enough cocoa to keeps its members busy. Global demand (and global prices) are diverting local cocoa away from the processors. So they want 5 percent export tax on cocoa to provide an incentive for cocoa producers to [...]

Ghana and Côte d’Ivoire to Cooperate on Cocoa Prices

Michael — Thu, 05 Nov 2009 17:11:41 +0000

The Ivorian President Gbagbo’s two-day visit to Ghana ended with a joint communique expressing the two countries’ resolve to influence international cocoa prices. The communique pointed out that increases in production have not yielded comparative increases in revenue for the countries. It further criticized the impact of global commodity cartels on cocoa prices. Finally, Gbagbo [...]

Kraft Likes Deal with Rainforest Alliance

Michael — Wed, 04 Nov 2009 23:22:35 +0000

Kraft, the global food giant, likes the deal it struck with the Rainforest Alliance. So much so, it expanded its commitment to purchase RA certified cocoa from 3,000 to 30,000 by 2012. It’s the first major food giant in Europe to carry the RA seal. That’s still a drop in the bucket given the amount [...]