Mondelēz commits an additional US$600 million to cocoa sustainability

diving letter:

  • Mondelēz International will spend an additional $600 million on its Cocoa Life program through 2030. Launched in 2012, the initiative aims to scale cocoa volumes, Address environmental and human rights challenges and improve the livelihoods of cocoa farmers.
  • Mondelezwhich has invested $1 billion in Cocoa Life since the program began is the most recent CPG to invest large sums of money in its cocoa operations given the increasing demand for products that use cocoa.
  • Dirk Van de Put, CEO of Mondelēz, said more collaboration is needed to have a meaningful impact on the harvest. “We call for more industry-wide efforts and actions to make a greater impact, including new public-private partnerships,” he said.

Dive insight:

While inflation and supply chain issues have impacted the near-term availability of a variety of products, companies like Mondelēz are taking steps to ensure there are no longer-term problems with access to one key ingredient: cocoa.

Ten years after Mondelēz founded Cocoa Life, the company behind Oreo and Milka chocolate said net incomes for farmers in Ivory Coast have increased by 33% and in Ghana by 15%. More than 200,000 growers are participating in the program, “with double-digit percentage gains in farmers earning a living income,” the company noted. At the same time, cocoa yields have increased, it said.

By 2030, Cocoa Life aims to increase the number of farming households earning a living wage, improve child protection and access to quality education, and end deforestation on Cocoa Life farms. The aim is to work with around 300,000 farmers by 2030.

Few sectors have grabbed the spotlight in recent years like cocoa production.

The industry faces several challenges, including volatile prices, low farmer incomes, persistent child labor and ongoing climate change impacts.

With the cocoa and chocolate market projected to surpass $67 billion by 2025, according to a Fortune Business Insights report in 2025, companies that depend on the ingredient have little choice but to spend big now to ensure that they will have enough stocks in the future at a reasonable price. The surge in demand comes as consumers place more emphasis on sustainability when purchasing products.

Almost every major ingredient and food manufacturer that depends on cocoa, including Hershey, Barry Callebaut and Olam, has invested or committed money when it comes to the commodity and its producers. In January, Nestlé, the world’s largest food company, announced it will triple its sustainability funding for cocoa to $1.4 billion by 2030.

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