Cargill celebrates establishment of Ghana License Buying Company

19 Apr 2017

Last week, Cargill celebrated establishing its own licensed buying company, which allows it to directly source cocoa from certified farmers in Ghana for the first time.

Cargill celebrates establishment of Ghana License Buying Company

Last week, Cargill celebrated establishing its own licensed buying company (LBC) – Cargill Kokoo Sourcing – in Ghana. It allows Cargill to directly source cocoa from certified farmers in Ghana for the first time. So far over 25,000 farmers are registered, of which 9,000 are actively pursuing selling beans through Cargill’s LBC network. Cargill already sources directly from farmers and farmer organizations in other origin countries.

Cargill says that moving to this model in Ghana means that it will be better positioned to efficiently implement the Cargill Cocoa Promise, Cargill’s commitment to improving the lives of cocoa farmers and their communities, at scale and better serve its customers.

Cargill’s purchasing model is built on the principles of sustainability and full traceability in Ghana. Farmers deliver their cocoa to community warehouses where their beans are digitally weighed in front of them, assigned a fully traceable bar code and funds are then transferred straight to the farmer’s phone or e-wallet.

Details of the beans are then recorded in a standardized management system before the beans are collected by larger trucks, which transfer them to central warehouses. Through Cargill’s new bar code system, the company can now trace each individual bag of Ghanaian cocoa beans, sourced through the Cargill LBC, to the individual farm, creating a fully traceable supply chain down to farmer level for the first time in Ghana.

"Never before has it been more critical for cocoa farmers in Ghana to be the master of their own destiny and improve their own livelihoods,” said Lionel Soulard, Managing Director West-Africa Cargill Cocoa & Chocolate. “With the introduction of an innovative digital payment system, or mobile money for short, this first-of-its kind initiative at scale in Ghana is creating a great opportunity for smallholder finance at the farm level.”

"We strongly believe that this way of doing business is the future for cocoa farmers in Ghana. Mobile money is the first step towards improving incomes for farmers, as we build the infrastructure and capabilities for a more efficient and effective supply chain. Our aim is to create an enabling environment for smallholder finance for the future, resulting in better entrepreneurial spirit already noticeable at the farmer level.”

"Having long standing relations with cocoa farmers and their communities is critical for the full implementation of our sustainability approach and we now intend to expand our existing sustainability activities to enable farming communities to benefit from training, community and farm development support. We intend to scale up existing activities to enable the current 9,000 farmers dealing with the LBC to benefit from good agricultural practice training, community development, farm development and support in line with the COCOBOD strategy. Developing our sourcing capabilities in the world’s second largest cocoa producing country is an essential step to meet growing customer demand for sustainable, certified cocoa."

"We are excited to continue this sustainability journey in Ghana, in partnership with COCOBOD, to address key challenges for our industry such as deforestation. Together, we are investing in the next generation of cocoa farmers and supporting the development of farmer aggregates,” said Soulard. "We look forward to building on our long history in the country and to embracing innovative sustainability practices and the latest technologies along the way. Above all else, we are committed to improving the livelihoods of Ghanaian cocoa farmers and their communities for generations to come."