Cocoa: A Bittersweet Supply Chain - Visual Capitalist
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Cocoa: A Bittersweet Supply Chain

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Cocoa supply chain

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Cocoa: A Bittersweet Supply Chain

From bean to bar, the cocoa supply chain is a bittersweet one. While the end product is something most of us enjoy, this also comes with a human cost.

Based on how much cocoa comes from West Africa, it’s likely that most of the chocolates we eat have a little bit of Cote d’Ivoire and Ghana in them. The $130B chocolate industry relies on cocoa farming for supply of chocolate’s key ingredient. Yet, many cocoa farmers make less than $1/day.

The above graphic maps the major trade flows of cocoa and allows us to dive deeper into its global supply chain.

From Bean to Bar: Stages in the Cocoa Supply Chain

Cocoa beans go through a number of stages before being used in chocolate products.

  1. Harvesting, Fermenting, and Drying
    First, farmers harvest cocoa beans from pods on cacao plants. Next, they are fermented in heaps and covered with banana leaves. Farmers then dry and package the cocoa beans for domestic transportation.
  2. Domestic Transportation, Cleaning, and Exporting
    Domestic transporters carry packaged cocoa beans to either cleaning warehouses or processing factories. Cocoa beans are cleaned and prepared for exports to the chocolate production hubs of the world.
  3. Processing and Chocolate Production
    Processing companies winnow, roast, and grind cocoa beans and then convert them into cocoa liquor, cocoa butter, or cocoa cakes—which are mixed with other ingredients like sugar and milk to produce chocolate products.

Cocoa farming and trade are at the roots of the chocolate industry, and the consistent supply of cocoa plays a critical role in providing us with reasonably-priced chocolate.

So where exactly does all this cocoa come from?

The Key Nations in Cocoa’s Global Supply Chain

Growing cocoa has specific temperature, water, and humidity requirements. As a result, the equatorial regions of Africa, Central and South America, and Asia are optimal for cocoa farming.

These regions host the biggest cocoa exporters by value.

Rank (2019)Exporting CountryValue (US$, millions)
1Côte d’Ivoire 🇨🇮$3,575
2Ghana 🇬🇭
$1,851
3Cameroon 🇨🇲$680
4Ecuador 🇪🇨$657
5Belgium 🇧🇪$526

Côte d’Ivoire and Ghana are responsible for 70% of global cocoa production, and cocoa exports play a huge role in their economies. Although the majority of exporters come from equatorial regions, Belgium stands out in fifth place.

On the other hand, most of the top importers are in Europe—the Netherlands and Germany being the top two.

Rank (2019)Importing CountryValue (US$, millions)
1Netherlands 🇳🇱$2,283
2Germany 🇩🇪$1,182
3U.S. 🇺🇸$931
4Malaysia 🇲🇾$826
5Belgium 🇧🇪$719

In third place, the U.S. primarily sources its cocoa from Côte d’Ivoire, Ghana, and Ecuador. Mars, Hershey, Cargill, and Blommer—some of the world’s biggest chocolate manufacturers and processors—are headquartered in the U.S.

Finally, it comes as no surprise that the biggest importers of cocoa beans are among the biggest chocolate exporters.

Rank (2019)CountryValue of Chocolate Exports
(US$, millions)
1Germany 🇩🇪$4,924
2Belgium 🇧🇪$3,143
3Italy 🇮🇹$2,100
4Netherlands 🇳🇱$1,992
5Poland 🇵🇱$1,834

Not only is the Netherlands the biggest importer of beans, but it’s also the biggest processor—grinding 600,000 tons annually—and the fourth largest exporter of chocolate products.

Belgium is another key nation in the supply chain, importing cocoa beans from producing countries and exporting them across Europe. It’s also home to the world’s largest chocolate factory, supporting its annual chocolate exports worth $3.1 billion.

Breaking Down the Cocoa Supply Chain: Who Gets What

Without farmers, both the cocoa and chocolate industries are likely to suffer from shortages, with domino effects on higher overall costs. Yet, they have little ability to influence prices at present.

cocoa supply chain breakdown

Farmers are among the lowest earners from a tonne of sold cocoa—accounting for just 6.6% of the value of the final sale.

Low incomes also translate into numerous other issues associated with cocoa farming.

The Bitter Side of Cocoa Farming

The World Bank has established the threshold for extreme poverty at $1.90/day. Cocoa farmers in Ghana make $1/day, while those in Côte d’Ivoire make around $0.78/day—both significantly below the extreme poverty line.

Farmers are often unable to bear the costs of cocoa farming as a result of low incomes. In turn, they employ children, who miss out on education, are exposed to hazardous working conditions, and get paid little or no wages.

CountryCocoa Farmers Making $1/day or lessChildren in Cocoa Agriculture
Côte d’Ivoire 🇨🇮600,000
891,500
Ghana 🇬🇭800,000708,400

To make matters worse, cocoa farming is primarily responsible for deforestation and illegal farming in Côte d’Ivoire and Ghana—adding environmental issues to the mix.

These interconnected problems call for action, so what is being done to fight them?

Combating Cocoa’s Concerns

Mars, Nestlé, and Hershey—some of the world’s biggest chocolate manufacturers—have made several pledges to eradicate child labor in cocoa farming over the last two decades, but haven’t reached their targets.

In addition, organizations such as UTZ Certified, Rainforest Alliance, and Fairtrade are working to increase traceability in the supply chain by selling ‘certified cocoa’, sourced from farms that prohibit child labor.

More recently, Côte d’Ivoire and Ghana announced a fixed premium of US$400/tonne on cocoa futures, aiming to improve farmer livelihoods by creating a union for cocoa, also known colloquially as the “COPEC” for the industry.

While these initiatives have had some positive impacts, more still needs to be done to successfully eradicate large-scale child labor and poverty of those involved in cocoa’s bittersweet supply chain.

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Agriculture

What are the Most Produced Cash Crops in Africa?

From wheat to cassavas, also known as yuca, here are the top cash crops in Africa and their share of global production.

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Cash Crops

What are the Most Produced Cash Crops in Africa?

Agriculture makes up nearly 20% of Sub-Saharan Africa’s economy—a higher percentage than any other region worldwide.

From Nigeria to the fertile land across the East African Rift Valley, the continent is home to 60% of the world’s uncultivated arable land.

Given the massive role of agriculture across the region, this infographic from Zainab Ayodimeji shows the most produced cash crops in Africa and their share of total global production.

The Top 20 Cash Crops in Africa

Cash crops, such as coffee or rice, are crops that are produced for a salable market.

With data from the Food and Agriculture Organization Corporate Statistical Database (FAOSTAT), here are the most produced cash crops in Africa:

Cash Crop
Tonnes Produced 2019
% of World Production
Cassava192.1M63%
Sugar cane97.3M5%
Maize81.9M7%
Yams72.4M97%
Rice, paddy38.8M5%
Sorghum28.6M49%
Rice, paddy (rice milled equivalent)
25.9M5%
Sweet potatoes27.9M30%
Wheat26.9M4%
Plantains26.7M64%
Potatoes26.5M7%
Fresh vegetables22.0M7%
Oil palm fruit21.9M5%
Tomatoes21.7M12%
Bananas21.5M18%
Groundnuts, with shell16.6M34%
Sugar beet14.3M5%
Onions, dry13.9M14%
Millet13.7M48%
Oranges9.8M12%

Cassava, also referred to as yuca, is the most produced cash crop by a wide margin. With nearly 200 million tonnes of it produced annually, Africa’s production of cassava makes up a majority (63%) of the global total.

While cassavas are not well known in the Western world, they feed 800 million people globally. Cassavas are an essential root vegetable that has similar uses to potatoes.

Sugar cane, maize, and yams are also significant cash crops.

Notably, Africa’s yam production is 97% of the global total. West Africa is known as the “yam belt,” covering Nigeria, Ghana, Benin, and Côte d’Ivoire. With over 60 million people across the yam belt directly or indirectly involved in its production, yam cultivation is an important component of the region’s economic vitality.

Agriculture Composition of GDP, by Region

While agriculture plays a significant role in Africa’s GDP, what role does it play across other regions around the world?

Agriculture portion of GDP, by global region

Like Sub-Saharan Africa, agriculture is a major part of South Asia’s economy. India produces nearly 24% of rice around the world, while Bangladesh produces over 7% of total global production. Meanwhile, over 14% of the global wheat supply is also produced by India.

On the other hand, agriculture makes up just 1% of North America’s GDP. The number of farms in the U.S. peaked in the 1930s and has sharply declined from almost 7 million to 2 million in 2020.

The Future of Africa’s Cash Crops

Despite Africa’s expansive agriculture sector, there remain bottlenecks to productivity.

In light of these challenges, several technological advances have the potential to improve farmers’ bottom lines. For instance, precision technology measures rainfall, soil information, and soil productivity. At the same time, remote sensing technology can provide information on weather and climate.

This, coupled with the majority of the world’s uncultivated arable land, presents a significant opportunity for cash crops going forward. By one estimate, cereal and grain production has the potential to increase threefold.

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Agriculture

Visualizing the World’s Loss of Forests Since the Ice-Age

How much has the world’s land use changed over the last 10,000 years, and how have forests been impacted?

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The World’s Loss of Forests Shareable

Visualizing The World’s Loss of Forests Since the Ice-Age

How much of Earth used to be covered by forests, and what portion is covered today?

The effects of deforestation on the climate are already being seen and felt, and these repercussions are expected to increase with time. That’s why more than 100 world leaders pledged to end and reverse deforestation by 2030 at the COP26 climate summit.

As today’s graphic using data from Our World in Data highlights, the world’s forests have been shrinking since the last ice age at an increasingly rapid pace.

Earth’s Surface Area: 10,000 Years Ago

To examine the deforestation situation properly, it helps to understand Earth’s total available surface area. After all, our world can feel massive when glancing at maps or globes. But of the roughly 51 billion hectares in total surface area on Earth, more than 70% is taken up by oceans.

What’s left is 14.9 billion hectares of land, not all of which is habitable. Here is how the land was allocated 10,000 years ago, after the last ice age and before the rise of human civilizations.

Uninhabitable land on Earth (10,000 years ago):

  • Barren land (19% or 2.8bn ha)—Includes deserts, salt flats, exposed rocks, and dunes
  • Glaciers (10% or 1.5bn ha)—The vast majority concentrated in Antarctica

Habitable land on Earth (10,000 years ago):

  • Forest (57% or 6bn ha)—Includes tropical, temperate, and boreal forests
  • Grassland (42% or 4.6bn ha)—Wild grassland and shrubs
  • Freshwater (1% or <510M ha)—Lakes and rivers

By 2018, forests had receded to just 4 billion hectares. What happened?

Forests and Grassland Recede for Agriculture

Once humans figured out how to cultivate plants and livestock for regular sources of food, they needed land to use.

For centuries, the loss of greenery was relatively slow. By 1800, the world had lost 700 million hectares each of forest and grassland, replaced by around 900 million hectares of land for grazing animals and 400 million hectares for crops.

But industrialization in the 1800s rapidly sped up the process.

Percentage of Habitable Land17001800190019502018
Forest52%50%48%44%38%
Grassland38%36%27%12%14%
Grazing6%9%16%31%31%
Crops3%4%8%12%15%
Freshwater1%1%1%1%1%
Urban<1%<1%<1%<1%1%

While half of Earth’s loss of forests occurred from 10,000 years ago to 1900, the other half or 1.1 billion hectares have been lost since 1900. Part of this loss, about 100 million hectares, has occurred in the more recent time period of 2000 to 2018.

The biggest culprit?

Though urban land use has rapidly grown, it still pales in comparison to the 31% of habitable land now being used for grazing livestock. Most of that land came at first from repurposed grasslands, but forests have also been cleared along the way.

Where Will Food Come From?

Countries pledging to stop deforestation have two major hurdles to solve: financial and survival.

Firstly, there are many companies, jobs, and economies that rely on producing and marketing goods made from forests, such as lumber.

But more importantly, the world’s rising use of land for crops and agriculture reflects our rapidly growing population. In 1900, the global population numbered just 1.6 billion people. By 2021, it had exceeded 7.9 billion, with hundreds of millions still affected by food shortages every day.

How do you feed so many without needing more land? Meat’s extremely large footprint makes prioritizing crops more attractive, and research into other solutions like lab-grown meat and grazing erosion prevention is ongoing.

As the effects of climate change become increasingly felt, it’s likely that countries, companies, and people will have to embrace many different solutions at once.

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