The maker of chocolate M&M’s and Snickers sees a growing risk on the horizon: sliding cocoa supply from one of the world’s top growers.
The answer? Comics and WiFi. Mars Inc., maker of candy famous to consumers across the world, is among firms trying to lure millennials into cocoa farming in Indonesia, where aging planters, decaying trees, pests and diseases have depressed output so much that the nation has become a net importer. The hope is that the younger set, attracted by free Internet, will get hooked on cocoa at themed cafes and be persuaded to return to the farms.
“We opened a cafe that has WiFi, and many pictures and objects about cocoa farming, and it’s attracted a lot of teenagers because of the WiFi,” said Arie Nauvel Iskandar, chairman of the Indonesia Cocoa Association and director of corporate affairs at PT Mars Symbioscience Indonesia. “It’s just one way to introduce young people to cocoa.”
The association, which is working with Mars and other companies to boost supply, says output could rise 15 percent next year to 300,000 metric tons as trees planted in recent years mature. To ensure crop growth doesn’t flag after that, a national program will kick in to push output to 600,000 tons by 2024, said Iskandar. The plan aims not only to attract millennials, but make stronger clones and more funding available to curb pests and diseases, he said.
A crop of that size would be large enough to meet rising demand from domestic processors, and supply the world market, said Iskandar. “With the best farming practices, mentoring, proper fertilizer and the right planting materials, we’ll be able to meet the target,” he said.
The increased output may go some way to ease chocolate makers’ dependence on the world’s biggest growers, Cote d’Ivoire and Ghana, as demand climbs in the next few years. The global chocolate confectionery market grew 2.5 percent in the nine months through April, according to Barry Callebaut, the top cocoa processor, in July, citing data from analytics firm Nielsen.
“Cocoa must be seen as an option for living and having a good future,” Iskandar said in an interview. “Many farmers send their children away to school, so they don’t follow in their father’s footsteps because they feel a farmer’s life is hard. We have to give enough information to them and the millennials” to change that perception, he said.
The national program will be finalized next year and start under the new administration in early 2020 at the latest, he said. Indonesia holds presidential elections in April.
Cocoa areas have shrunk to about 1.3 million hectares as land is converted to residential or infrastructure use, or farmers switch to more profitable crops such as palm oil, according to Iskandar. The area was about 1.7 million hectares in 2010, the association said last year.
Indonesia is the largest palm oil producer, accounting for about half of global supply. While palm is grown mainly in Sumatra and Kalimantan, there’s been a massive expansion of plantations in Sulawesi in the past few years, threatening cultivation of cocoa. Sulawesi accounts for about 70 percent of the nation’s cocoa production.
This article first appeared on: www.bloomberg.com, by Yoga Rusmana and Eko Listiyorini
