We recently wrote about how blockchain was changing the way we buy coffee. The same technology is also not only being used to help track and trace chocolate back to the farmer but adds some exciting other features that could change the way we consider which chocolate to buy.
When we see something is labelled as ‘fair trade’, most consumers only have a vague notion that this must be better for the producers, but it only works on faith and trust. Psychologically, we are much more likely to care about something when we are faced with personal details. It’s why charities put a single child’s face in their awareness campaigns rather than talk about the thousands. We make personal connections, and this is exactly what the United Nations Development Progam (UNDP) in Ecuador is doing with a concept to take verifiable track and trace to the chocolate we consume. They have launched the concept under a product called The Other Bar.
What is The Other Bar Experiment?
There is a 2-minute video below which explains the concept pretty well.
Quality is at the top, so consumers don’t feel like they have to make a sacrifice for a good cause.
Blockchain is used for the track and trace back to the farmer
QR code is used on the packaging that gives details down to the farmer and exact location.
A token of value is given for each bar, which the consumer can choose to take themselves or award back to the farmer.
The Other Bar Video Explainer
Why Fairtrade Isn’t Enough
Cocoa farmers only get a small percentage of the actual cocoa value in each bar that works out to be an average of just 3%. Most of these farmers are not able to scrape together a living wage. Under the Fairtrade program, farmers earn a minimum level slightly higher than the world price, so if cocoa is selling at $1,900 a metric ton; the Fairtrade minimum is $2,400. But with the One Bar project, a farmer could expect to get paid $3,400 a metric ton for the same crop without taking into account extra income made from the consumers who donate the token back to the farmer.
How the Other Bar Token Works
The tokens are inside the wrapping of the chocolate and as stated earlier, it’s up to the consumer if they want to use this themselves or give back to the farmer. If they choose to give it back to the farmer, the money is sent to their local farmer’s association which uses it to plant cacao trees.
It takes only four bars to plant one tree, and that tree helps the farmer raise their crop and hence living standards. Using blockchain means the process can be made transparent and can be tracked back so the consumer can know the funds are used appropriately without having to trust different organizations to distribute the money.
Why the Cocoa Industry Needs More Transparency
Audits carried out in 2018 and 2019 have shown an alarming level of disparity between the claims of chocolate manufacturers and the farmers. While the supply chain remains opaque and requires auditing to identify misuse, the industry will continue to suffer and risks building mistrust with consumers.
Many farmers are using paper records which means they must first digitize their business. This is all possible now, thanks to cheap android phones, affordable data plans and cloud computing, but introducing the technology and training the farmers is a large project. As the process becomes more digital, however, it will become more efficient and transparent, which in turn will lead to lower costs and reduce the opportunity for abuse.
Summary
There is no silver bullet that will solve all the problems overnight, but the Other Bar project is an example of how the industry can start pushing a transparency program through the supply chain that directly involves consumers, making them feel part of the solution. Combine this with a roll-out of digital technology with the farmers, and there is hope that over the next few years we can see a significant reduction in supply chain costs, and an improvement in farmers lives which we can all be a part of.
