Future Farming Initiative: Barry Callebaut creates “high-tech and sustainable” cocoa farming business

22 Apr 2024 --- Barry Callebaut plans to create a fully scalable, sustainable and profitable cocoa farming model for the industry. The Group will establish the investment company FFI to develop technology and R&D capabilities. The chocolate and cocoa giant believes FFI could be a catalyst for others to invest in farming and create partnerships with farmers to modernize sustainable cocoa farming at scale.

Chocolate confectionery is a significant and dynamic market, expected to be worth over US$128 billion (€130 billion) in global retail sales by the end of this year, and with a volume growth of +2% over the next five years to 2027.

Moreover, the move to develop a modernized farming model to influence the rest of the industry comes on the heels of record cocoa prices in recent months. The industry at large has been hit by unstable market dynamics caused by drought, biodiversity issues and disease, which has ravaged cocoa crops in key growing regions in West Africa. 

Launching FFI
Learnings from the initiative will be leveraged to help cocoa farmers in growing regions, supporting them toward more productive and sustainable cocoa farming.

Steven Retzlaff will become FFI’s executive chairman.“We take our responsibility for all stakeholders very seriously. Over more than ten years, the company has made many positive steps on its sustainability journey as manifested last year in our renewed Forever Chocolate program that will continue to support the development of sustainable cocoa production in our origin sourcing countries,” says CEO Peter Feld.

“To fully unlock our know-how, which we acquired over the past decade, we now aim to be a catalyst and create the future of sustainable, high-tech cocoa farming for the industry.”

Steven Retzlaff will become FFI’s executive chairman. He will remain a member of Barry Callebaut’s Executive Committee, while Alain Freymond will succeed Steven Retzlaff as president of Global Cocoa.

“I am convinced that with FFI, we will not only bring cocoa farming to industrial levels, but we will also help make sustainable cocoa the norm,” says Retzlaff. 

“We will be able to transfer our learnings and expertise from FFI to our partners in all our origin-sourcing countries to continue to help them on their journey to more productive and sustainable cocoa farming. Something which has been very close to my heart for the past decades and will remain so in the future.”

High-tech farming pilots
Barry Callebaut is examining wider cocoa-growing markets and has signed the first deal with a high-tech farming business in Bahia, Brazil, to develop 5,000 hectares of land. 

The pilot will develop best practices, which will then be used to create the model for others to follow. Further agreements similar to this initial pilot in Brazil are planned for 2024 and beyond.

Barry Callebaut’s original 640-hectare Farm of the Future property in Cerecitas, Ecuador, will also be part of the FFI. 

Ecuador is gaining momentum as a leading cocoa-growing region and is predicted to overtake Ghana as the world’s second-largest producer.

Climate-induced drought and other issues are devastating cocoa crop yields in West Africa, including Ghana.

Consumers chase high-quality chocolate
According to notes Barry Callebaut, the recent price hikes in the chocolate confectionery category have led to consumers responding in two ways.Consumers prefer to purchase premium, high-quality chocolate to treat themselves. (Credit: Barry Callebaut)

The company cites Innova Market Innova research that suggests just over half (54%) of consumers prefer to purchase premium, high-quality chocolate to treat themselves, celebrate, and escape the ordinary experience by purchasing small luxury items, such as premium and high-quality chocolate. 

Sixty-six percent of consumers are looking for better value for their money. This Group is also looking for ways to get more for their money, such as buying in bulk, taking advantage of economies of scale, or switching to private-label brands.

By Gaynor Selby