Mars described the recently introduced living income differential (LID) and floor price for cocoa as being critical to achieving a sustainable cocoa sector.

The company also challenged members of the World Cocoa Foundation (WCF), a global body of stakeholders in the cocoa sector, to support the LID mechanism to help make it a success and improve the living conditions of cocoa farmers.

Addressing global stakeholders in the cocoa value chain at the 2019 WCF partnership meeting in Berlin, Germany, yesterday, the Global Vice-President of Cocoa at Mars, Mr John Ament, said in line with its support for the mechanism, Mars would buy its cocoa from Ghana and Cote d'Ivoire "with the LID".

He said the LID was “a robust and transparent process that ensures that the additional income reaches each farmer”.

“This can limit further expansion of land use for cocoa farming, making the LID a potential key approach to addressing the income challenge,” he said at the partnership meeting, with the Chief Executive Officer of COCOBOD, Mr Joseph Boahen Aidoo, and other staff of the board in attendance.

About LID

The LID is an initiative of COCOBOD and Le Conseil du Café Cacao (CCC) of Cote d’Ivoire and it mandates buyers of cocoa from the two countries to pay an extra $400 on every tonne of cocoa they purchase.

It became effective from July this year as a credible step by the two leading suppliers of cocoa to attract fairer prices for their cocoa and higher incomes for farmers.

The Daily Graphic understands that the mechanism is currently being applied on the forward sale of Ghana’s 2020/2021 cocoa beans.

'Transparent mechanism'

Mr Ament said Mars saw the efforts by Ghana and Cote d’Ivoire to ensure increased incomes for farmers as one of “two key actions” that the global cocoa industry, in collaboration with governments, non-governmental organisations, suppliers, farmers and others, must take.

"Mars supports the LID, is committed to it and calls on other WCF member companies to join us and do same," he said.

He said although the challenge with farmer incomes could be addressed through increased production, the price farmers were paid for their cocoa was critical, hence the resolve by the company to support the initiative.

Communique

Meanwhile, a communique issued by COCOBOD and CCC yesterday, after the partnership meeting, said the two governments and the industry agreed that without improved cocoa income, there could not be a sustainable cocoa industry.

“The industry clearly indicates that it is implementing the LID introduced in July for the 2020/2021 season as part of the mutual objective to raise farmer income.

“They are taking the necessary actions towards its full and immediate implementation,” the communique, signed by the CEO of COCOBOD and the Director-General of CCC, Mr Kone Brahima Yves, said.

It said both sides further reaffirmed their position that the LID and sustainability programmes could operate together, as the two complemented each other in ensuring the sustainability of the industry and the achievement of the Sustainable Development Goals (SDGs).

“We, therefore, announce that the LID and the sustainability programmes will co-exist and complement each other. Cote d’Ivoire and Ghana will continue with the implementation of sustainability and certification programmes,” it added.

It said the two countries “shall monitor and evaluate the complementary co-existence of the LID and sustainability programmes being implemented in our respective countries to decide on them, going forward”.

“We reaffirm our commitment to eradicate child labour and deforestation in cocoa and will collaborate with all stakeholders to promote and sustain the cocoa industry,” it concluded.