Boosting cocoa traceability with tech, collaborations and sourcing scrutiny

17 Aug 2020 --- Consumers are increasingly keen to learn more about the bean-to-bar journey of cocoa products. To meet this end, traceable technology and cooperation throughout the supply chain help improve the quality of cocoa, strengthen farmer relationships and improve ingredient sourcing monitorization. FoodIngredientsFirst examines future perspectives of investing in traceability, the impact of brand storytelling and the pros and cons of transparency with experts from Cargill and Olam.

“Traceability provides transparency so that we can target our sustainability interventions to where they matter the most. The goal is to make an impact on the ground. Traceability should always follow a clear need for more transparency and visibility into sustainability risks and issues,” says Taco Terheijden, Cargill Cocoa & Chocolate Sustainability Lead.

“We’re seeing increased demand for traceability across our supply chain and ingredients portfolio as customers take more of an interest in the stories behind the food and drink they enjoy. Manufacturers look to ensure quality and guarantee that the highest standards are being met when it comes to sourcing their products,” echoes Andrew Brooks, Head of Sustainability, Olam Cocoa.

Traceability plays into “Storytelling: Winning with Words”, which was crowned the Top Trend for 2020 by Innova Market Insights. “Consumers want to know more about the story behind their products: where they have come from, how they are sourced and what the social and environmental impact has been. They increasingly expect companies to do their part to solve some of the big societal and environmental issues we all face,” notes Brooks. 

For brands, traceability provides confidence in the integrity of the ingredients they buy and enables them to tell compelling origin stories that resonate with consumers, Terheijden pinpoints. “Players who undervalue traceability mechanisms are at risk of overlooking a key component of any sustainability program, and ultimately, risk losing consumers’ trust in their products.”

Customers are taking more of an interest in the stories behind the food and drink they enjoy.According to Innova Market Insights data, 59 percent of global consumers are interested in learning where their food comes from and how its made. The market researcher further details that India (29 percent), Brazil (27 percent) and Mexico (26 percent) have the highest percentage of consumers that prioritize transparency when buying food and beverages.

The loudest calls for traceable supply chains hail from Europe and North America, Terheijden details. In terms of companies “doing their part,” he shares that this involves adhering to social standards and ethical economic practices. 

This prerogative is backed up by Innova Market Insights data that underscores how more than three quarters (79 percent) of global consumers believe that brands must be transparent about their production process. This may also include the information about traceability of the product.

Technology bonus
For Olam, it is not enough to inform consumers and customers about its traceability strides. The company actively provides them with data access via its B2B AtSource platform that reports the social and environmental footprints of a product’s journey. The platform has three tiers: 

• AtSource Entry Tier: Reassures customers that suppliers are engaged in responsible sourcing principles and practices under the Olam Supplier Code. The company provides country-level social and environmental risk-screening. 
• AtSource Plus: Focuses on 12 core sustainability topics, with over 80 indicators, starting at farmer group level. Granular traceability and advanced environmental footprinting. track right from the farm through to logistics, processing and delivery, to the customer.
• AtSource Infinity: Delivers a net positive impact at scale to significantly regenerate landscapes in which farmers prosper and communities thrive. Such programs can ultimately benefit wider populations and the earth’s ecosystems.

“[AtSource] provides them with unprecedented transparency on where their cocoa beans have come from, as well as the social and environmental impact they have had on their journey, from the farm right through to processing,” Brooks underscores. You can learn more about the AtSource platform hosted by FoodIngredientsFirst by registering to this upcoming webinar here.

Moreover, through the Olam and Farmers Information System (OFIS) mobile app, Olam can track its cocoa to a farm or cooperative and record the agricultural practices of individual farmers to create personalized Farm Development Plans. Here, the company gives advice and recommendations to help farmers improve the quality and quantity of their yields and therefore increase the income they can earn from their land.

At Cargill, barcoded cocoa bags and digital Cooperative Management Systems (CMS) have made half of the cocoa in the company’s global direct supply chain traceable as of this half-year. In 2018 to 2019, over 151,000 metric tons of cocoa beans were tracked. The CMS enables farmers organizations to manage loans, collect beans and check fixed versus variable costs. All farmer organizations in the direct sourcing network in Ghana and Côte d’Ivoire are now visible through an interactive Cargill Cocoa Promise Sourcing Partner Network map. 

“We have already achieved 100 percent traceability from farm to factory in our direct networks in Ghana. Moreover, 70 percent of our partner cooperatives in Côte d’Ivoire are participating in our CMS traceability scheme. We plan to achieve 100 percent bean traceability in Côte d’Ivoire by 2021 and introduce CMS in Cameroon in our direct sustainable supply chain,” Terheijden reveals.

OFIS mobile app in use (Credits: Olam).The company’s additional digital solutions and tools range from GPS mapping to digital farm management, with each tool playing a role in wider systems of monitoring and accountability. “This year, we are investing US$3 million in related initiatives to help us bring data together more efficiently and package it in a way that brings enhanced value to our customers and partners,” he adds.

Measuring sustainability success
All in all, there are “huge benefits” born from traceability in Olam’s experience. “Through the data and insight it provides, we can more accurately measure the success of our sustainability programs and tailor them to better serve the farming cooperatives and communities we work with. It’s for this reason that achieving traceability throughout our direct supply chain is one of the targets we’ve set ourselves for this year as part of Cocoa Compass, our sustainability ambition for a more environmentally positive, professionalized and quality-focused cocoa supply chain,” says Brooks.

Despite promising advantages of implementing farm-to-fork traceability, the main challenge is the number of digital solutions available, adds Terheijden. Also, the lack of harmonization across the sector may create an environment where too much data and traceability make it difficult to take action.

Respect and heightened care for the environment is a consequence of investing in traceability. “We’re bringing sustainability to everything we do, from freight options that generate less greenhouse gas emissions to technology offerings that enable farmers to reduce their use of fertilizers and other inputs,” Terheijden adds. 

Nevertheless, technology has allowed for traceability to become more affordable, he stresses. “The proliferation of innovative and cost-effective digital solutions is accelerating traceability, real-time data collection and financial transparency.”

Beans of the future
Consumers’ expectations around transparency and traceability show no signs of abating, says Terheijden. “We are confident that the work we’re doing, along-side others in this industry, will continue to transform how food is produced, shipped and processed, paving the way for a thriving cocoa sector for generations to come.”

“Traceability is not a fad. It’s an essential step toward creating a more environmentally positive, professionalized and quality-focused cocoa supply chain,” Brooks concludes. “It’s up to all of us in the industry to ensure cocoa remains an attractive profession for future generations and that we protect the environments and biodiversity of cocoa origins.”

By Anni Schleicher