Table of Contents
Forced Labor or Trafficking in Persons cited by U.S. Government
Child Labor cited by U.S. Government
Risk of Forced Labor or Trafficking in Persons cited by other source
Risk of Child Labor cited by other source
Documented presence of migrant workers
Documented presence or significant likelihood of third-party labor recruiters
Documented presence of other vulnerable workers
Large numbers of dispersed, unorganized, or informal small producers or other worksites
Multiple points of aggregation, co-mingling, and/or transformation across supply chain
Complex, opaque supply chains and/or lack of vertical integration
High degree of flexibility in procurement practices of downstream entities
Scale or nature of risk varies significantly based on geographic area of production
Scale or nature of risk is strongly associated with certain types of suppliers/entities
Scale or nature of risk is present across multiple tiers or nodes of supply chain (including in associated downstream or upstream goods)
Cocoa supply chains may take on a variety of forms, depending on their overall level of integration and whether they are part of a cooperative structure. However, a simplified cocoa supply chain can be described as follows; cocoa pods are cultivated and harvested on farms/ plantations. The pods may then be sent to fermentaries to be split, fermented, and dried; however, small-holder farmers most commonly perform fermentation and drying steps themselves. Intermediaries may buy beans directly from farmers and then sell them to wholesalers and exporters, while in other cases, intermediaries will buy the beans from farmers and then transport them to a cooperative.27An Investor Brief on Impacts that Drive Business Risks. Cocoa. Engage the Chain, October 2020, p. 4, engagethechain.org/sites/default/files/commodity/Cocoa%20Brief%20Engage%20the%20Chain%20Oct2020_0.pdf. Sometimes, farmers sell to cooperatives directly.28Stoop, P., et al. Technical Brief on Cocoa Traceability in West and Central Africa. C-Lever.org, 2021, p. 13, www.idhsustainabletrade.com/uploaded/2021/04/Cocoa-Traceability-Study-20.7L.pdf. Cooperatives and/or intermediaries may then process the cocoa beans locally or sell them for further processing and exporting abroad. Exporters may grind the purchased cocoa beans into cocoa liquor locally, but the majority will ship the cocoa beans to processing facilities in North America or Europe where they are ground and processed into cocoa butter, cocoa powder, or other forms. The cocoa trading and grinding industries are highly concentrated, with only three corporations controlling nearly half of the global cocoa trade.29An Investor Brief on Impacts that Drive Business Risks. Cocoa. Engage the Chain, October 2020, p. 5, engagethechain.org/sites/default/files/commodity/Cocoa%20Brief%20Engage%20the%20Chain%20Oct2020_0.pdf.
Manufacturers purchase cocoa powder, cocoa butter, and other forms of processed cocoa beans from traders/grinders in order to make chocolate and other cocoa products. In cocoa manufacturing as well, a small number of companies who create internationally popular candies and chocolates represent a large portion of the market share.30An Investor Brief on Impacts that Drive Business Risks. Cocoa. Engage the Chain, October 2020, p. 6, engagethechain.org/sites/default/files/commodity/Cocoa%20Brief%20Engage%20the%20Chain%20Oct2020_0.pdf.
Fermentation and Drying Centers
Refineries and Grinders
Cocoa is used in the production of chocolate and chocolate confectionary products.
Cocoa is used in the production of cosmetics and pharmaceuticals that are based on the cocoa derivative cocoa butter.