Maya Gold was the first UK product to be awarded the Fair Trade mark back in 1994 and was created when the founders of Green & Black discovered that organic cocoa farmers in Belize (Toledo) were being penalised as some larger confectionary companies tried to drive cocoa prices down.
One chocolate corporation had offered Mayan farmers lucrative prices to plant hybrid cocoa trees instead of the indigenous variety, only to subsequently slash prices as world cocoa prices plummeted. Green & Black agreed to pay farmers a premium for their organic cocoa crops and an additional fair trade price.
Before Hurricane Iris devastated southern Belize in 2001, Green & Black’s (a leading UK manufacturer and supplier of organic chocolate) bought all its cocoa for its fair trade Maya Gold brand from the Toledo Cacao Growers Association (TCGA), a co-operative of organic cocoa farmers. The hurricane destroyed the cocoa trees and reduced the crop by 80 per cent. By 2003, the membership of TCGA had fallen and the organisation was becoming unsustainable. A £225,000 grant from the Department of International Development (DFID), through the Business Linkages Challenge Fund matched in value by Green & Black’s, enabled the co-operative to plant new cocoa trees, train its staff and work towards self-sustainability for the farmers.
The BLCF's objective in supporting the linkage was to show other niche product producers that supporting more marginalised suppliers can lead to longer term commercial benefits, particularly when the source of supply is a marketing asset.
With the fair price, ongoing technical advice and management support, and regular on site monitoring of every cocoa plantation to ensure they adhere to the strict guidelines that govern organic production, Green & Black have seen a dramatic turnaround from the situation in 2003.
The project is on target to meet commercial sustainability. It has also had a tremendous impact on the Mayan community in Belize and is a very successful model in linkage creation between small scale activity and now a multinational enterprise, as Cadbury Schweppes acquired Green & Black recently.
When the Maya Gold project began, there were 175 acres of fruiting trees and 195 people employed plus temporary workers with the sale of cocoa benefiting 1950 people, most of whom had little or no secondary education and low HIV/AIDS awareness. Low levels of best practice meant low yields, uneconomic production quantities – in peak years, 26 tonnes (0.2 per cent of organic cacao market share) – and a maximum of US$51,000 going into the community each year.
The approach to increasing production by the TCGA was to increase existing planting by improved management practices and rehabilitation of hurricane damaged fields. Three years later, farmers exported 50 tonnes with a collective total income of US$88,000. Eight tonnes had been exported in 2002 and the increase was achieved with the same number of trees, which meant a five fold increase in yield and incomes.
In 2006, TCGA membership was 1020 and growing (target: 500), 1741 acres had been planted (target: 1275) and over half a million trees were planted in 2004 alone.
With the increased yields, the flow of money into the district, which was one of the poorest in Belize, has increased noticeably and more children are being sent to school and some communities have set up schemes where funds from communally farmed cocoa are invested in schools.
In February 2005, TCGA and Green & Black agreed a five year contract that guarantees the purchase of all organic cocoa that meets quality requirements. By then the project should be completely commercially sustainable. Already interest in cocoa as a crop has moved beyond a limited Mayan farmer base in Toldeo to communities throughout the country.
Some of the difficulties encountered during the project include land tenure issues, a severe drought in early 2005, disease outbreaks and cash crop farmers 'slash and burn' agriculture leading to runaway fires and tree damage. The Belize Ministry of Agriculture was encouraged to control disease outbreaks with external technical help provided by Green & Black.
The early issue of internal resistance was addressed by supporting the TCGA executive to deal with both internal and government issues and the TCGA is aware that it needs to continue to improve its management skills and develop a business-like approach if it is to maintain and grow its financial reserves.
One important lesson that will have an impact on the Maya Gold linkage creation model being used in other industries is that paying farmers promptly has an extremely positive effect on building the supply chain and instilling confidence in the project.
For more information contact BLCF fund manager, the Emerging Markets Group at this address