Investor Presentaiton
28 Cargill 2020 Annual Report
Transformation of the
cocoa and chocolate
chain
The first Cargill cocoa processing plant in the world was
installed in Ilhéus, Brazil, more than 40 years ago and is
connected to dozens of factories and development centers
around the planet. Today, the management and operation of
this chain in the country covers the cocoa bean origin, pro-
cessing, chocolate factory and innovation centers installed
in various states.
We act in the cocoa and chocolate market as a supplier of
liquor, powder and butter to produce chocolate, both to
large-sized industries as well as handmade production. Our
broad presence in this sector favors the development of
products and services that assist the entire chain.
In the country, the production we process follows the same
policies that we apply to all supply chains.
Being the second largest cocoa bean processor in the world,
Cargill identifies the peculiarities that make the Brazilian
market unique with regard to world production, considering
that the market still faces challenges involving sustainability
and scale. The country is the only one to cover the complete
chain, from producer to final consumer - it produces and pro-
cesses cocoa and manufactures and consumes chocolate on
a large scale. This causes the bean production to be insuffi-
cient, not just for exports, but also for local production.
Another point that differentiates the supply chain in Brazil is
that it is spread out and follows a family production profile.
With 90,000 producers spread among the states of Bahia,
Pará, Espírito Santo, Rondônia and Mato Grosso, fragmen-
tation requires greater capillarity of our team to maintain
direct contact with producers.
Due to this spread, the advances achieved in other countries
with the use of technology to obtain traceability and scale
remain incipient, as well as certification attempts. In order to
deliver more volume and add value, producers depend on
investments in technology.
Technical advances
Techniques taught to producers to improve production
and increase scale consist of: instructions on pruning,
efficient use of fertilizers, disease control, fermentation,
work safety, correct input application, use of PPEs and
environmental management.
Due to these characteristics, we have concentrated our
efforts on the beginning of the supply chain because we
understand that it is at this point that some of the most
urgent challenges are present and where we can cause the
greatest impact. Besides studying how to develop cooper-
atives, we have started to test a set of services to stimulate
certification, access to technical assistance via mobile
phones and are preparing satellite traceability.
In 2020, the company supported with financial and mana-
gerial resources pilot projects in the cocoa plantation area
of the State of Pará, in partnership with the Imaflora NGO.
We started work with 150 producer families, associated in
a cooperative for planting cocoa, a native Amazon species,
to reclaim areas converted into different land uses. When
grown amongst other species, cocoa increases its resilience
while promoting plant coverage, it recovers degraded areas
and contributes to biodiversity. The project included sup-
port to identify liability areas and mapping of the productive
areas, legal reserve and of the property itself.
Another 50 farmers were trained on better cultivation tech-
niques and efficient use of inputs to meet the sustainable
production standards and to become multipliers of good
practices in the region.
With the support of Solidaridad, the implementation of
experimental plots in the previous year generated as a result
an average gain in cocoa productivity of 34% and 26% addi-
tional revenue for the ten selected families, by means of the
Fertile Cocoa project.
In Bahia, a partnership was also signed with the Instituto
Floresta Viva under the Aliança Cacau project. Its purpose
is to make agro-forestry systems more productive and the
cabruca, besides offering support to environmental man-
agement of the properties and management of the 30 fam-
ily cooperative.
The initiatives are in line with the company's global goals and
are part of Cargill Cocoa Promise's commitment to economic
prosperity of smallholders and forest protection. The projects
follow our vision that the transformation of the supply chains
must be addressed collectively, by joining companies, clients
and specialized partners that know the local context and
culture.View entire presentation