April 21, 2022 - Peru
Peru is home to 60% of cocoa varieties in the world, which have won several awards. Cocoa is an important source of income for nearly 90,000 producer families and has a strong restorative potential for ecosystems. Today, the Peruvian sector is coordinating the implementation of a national agreement that enables the transition toward a deforestation-free supply chain.
Facing grown demand, and new European regulations for deforestation-free products, the Coalition for Sustainable Production (Coalición por una Producción Sostenible), a Peruvian multi-stakeholder platform, is promoting the first cocoa sector agreement called “Cocoa, Forest and Diversity Agreement.” The initiative brings together 19 companies, smallholders associations, civil society, and governments around the goal of achieving sustainable and high-quality cocoa.
The agreement plan has three priorities: 1) Determine the year of reference for monitoring cocoa-related deforestation; 2) Establish tools for the monitoring and traceability of deforestation-free cocoa; 3) Launch a services platform to support deforestation-free production and the application of incentives for smallholders to transition to sustainable production and implement communication strategies.
Market demand for sustainable cocoa is growing. According to CBI (2020), the demand for specialty cocoa is growing in Europe and it is expected to increase by 5% between 2020 and 2024. At the same time, the increase in more informed consumers who wish to know the story behind the product is putting pressure on the sustainability programs of companies and traders.
According to José Iturrios, from Alianza Cacao Peru, the agreement creates a chance to set up a new business model, different from the traditional way how cocoa is being produced today. It is an opportunity to create value for the half a million forest resources that belong to smallholder families, creating a business model that restores the ecosystem and increases their income.
The Agreement has brought together institutions such as the Peruvian Ministry of Agriculture Development and Irrigation, The Exporters Association (ADEX), Amazonas Trading Peru, Kaoka, Romex, Appcacao, the Cocoa Peru Alliance, Rikolto, Earthworm Foundation, Climate Focus, Acopagro,CIAT-Biodiversity, Kollpa de Loros, Earth Innovation Institute, Mecanismos de Desarrollo Alternos, Solidaridad, Rainforest Alliance, Cooperativa Agraria Allima Cacao Ltda., Lutheran World Relief and Tropical Forest Alliance.
- Last year, the European Union presented a proposal for the regulation of deforestation-free products that will be brought to the table by mid-2022 and is expected to be officially launched in 2023.
- According to the Environment Ministry of Peru, Peru has around 69 million hectares of forest and deforestation produces nearly 51% of total greenhouse gasses in the country.
- The Cocoa, Forest, and Diversity Agreement is part of TFA’s Amazon Origin Sustainable Cocoa to the World, which is supported by USAID under the U.S. Department of Agriculture and the U.S. Forest Service International Programs