Cocoa in Sulawesi, Indonesia

Globally, chocolate consumption has boomed over the course of the last decade. Consumption in Asia and Latin America is rising rapidly. At present, the European Union and North America represent 60% of the world’s chocolate consumption. There is a worldwide need to create a more sustainable form of cocoa production that will boost productivity so that future demand can be met. Small-scale farmers, who are responsible for 90% of global production, are therefore key to this revolution.

Indonesia is the world’s third biggest cocoa producer with 849,875 tons a year, most of which comes from Sulawesi. Sulawesi produces huge amounts of cocoa: South Sulawesi alone produces 70% of Indonesia’s total cocoa production. The majority of the cocoa is produced by small-scale farmers with low productivity due to a lack of knowledge regarding pests and diseases and how to treat them. Poor post-harvest techniques also lead to low quality fermented beans. Farmers have very limited access to credit and farmers’ organisations lack the necessary thrust to transform their cocoa production into a profitable business.

The overwhelming majority of cocoa farmers in Indonesia are not organised so as to be able to collect and sell a consistent quality and volume of their members’ products effectively and efficiently. Most of these farmers do not understand quality, volume and product safety standards. Their weak negotiating position is the result of the inability of the farmers’ organisations to build business relations and negotiate with the private sector. Therefore, only a handful of private companies believe that farmers’ organisations can be professional business partners and are able to provide good quality, sustainable cocoa. Examples are PT Mars and PT Armajaro, which have developed business models involving smallholder farmers such as the Amamah farmers’ organisation in Polewali Mandar and Masagena in North Luwu. These private firms buy certified cocoa beans at premium prices, provide training on product certification according to UTZ standards, facilitate access to credit from financial institutions, and develop inclusive business models with farmers’ organisations.

Challenges

• Low cocoa production at farm level due to ageing plantations, pests and diseases such as cocoa stem borer
• Many farmers use subsidized chemical fertilizer
• Poor quality of fermented beans due to poor post-harvest processing
• Farmers’ organisations lack expertise in cocoa business management
• Farmers have very limited access to financial institutions

Our strategies

• Increase productivity by planting superior varieties which are resistant to pests and diseases
• Organic farming practices such as producing organic fertilizer
• Promote sustainable agricultural practices, such as inoculation techniques and the renewal of ageing plantations to improve cocoa productivity
• Farmer Field Schools to carry out experiments, observation and group analysis. Farmers visit other FOs to exchange knowledge and seek inspiration
• Post-harvesting techniques such as drying
• Set up a system to obtain market information (such as price) on a regular basis
• Training to strengthen the management and organisational capacities of the farmers’ organisations. We coach them in recording their activities and thorough accounting.
• Sustainable contracts with private partners. Set up clonal gardens (field research centres) with Continaf and Mars.

Source: https://www.rikolto.org/en/project/cocoa-sulawesi-indonesia