Fairtrade has released new Living Income Reference Prices for cocoa farmers in Cote d’Ivoire and Ghana that are intended to allow producers to enjoy a decent standard of living. These new prices take into account the rising costs of living and other economic troubles that farmers in West Africa, which accounts for the bulk of global cocoa production, experience.
The new reference prices are set at 2.68 per kilogram for Ghanaian cocoa and €2.65 ($2.80) per kilogram for Ivorian cocoa, which is an increase of 26% and 20%, respectively. The adjustments account for the increased cost of living, the lower output of food from households, and the reduction in the land’s cultivation for cocoa in Cote d’Ivoire. Fairtrade has also increased the target productivity level in Ghana from 800 kg per hectare to 600 kg per hectare, which is expected to be achieved within two years after implementing measures for improved agricultural output in the country.
The price of cocoa globally has increased sharply, expecting to rise five times between 2022 and 2024. Government set farmgate prices in both countries now exceed the updated reference prices. However, Fairtrade asserts that these reference figures serve as large-scale production price guarantees when the prices are unfavorable. This makes certain that cocoa producers can achieve a decent standard of living even with changing prices.
All alterations will come into effect starting from October 1, 2025. Should farmgate prices fall below Fairtrade’s criteria, the organization will publish differentials in order to keep proper earnings for farmers. The goal of this approach is to achieve greater financial sustainability in cocoa farming.
Fairtrade’s pricing measures are also aimed at improving farmers’ economic conditions. Many cocoa producers are unable to earn enough money to feed their families or procure basic necessities like housing, education, and health care. Increasing prices assists in closing the income gap and putting money into the hands of smallholder farmers.
Apart from setting prices, Fairtrade has also been active in encouraging the adoption of environmentally friendly farming techniques. The organization enhances productivity and preserves biodiversity by supporting agroforestry and other climate change adaptation practices. Such new pricing in economically depressed regions will also support environmental conservation.
Chocolate manufacturers and retailers are encouraged to use Fairtrade-certified cocoa as an immediate and direct response to these changes. Global brands who are willing to integrate ethical sourcing commitments may widen the scope of the impact of these pricing policies, so that farmers can be paid adequately. Sustainable and fair trade products are also easier to access for consumers, and their selection actively promotes fair trade practices.
Fairtrade’s strategy underlines the requirement for a ‘structural’ adjustment of the cocoa supply chain. In as much as price increases do profit farmers, sustained solutions will demand policy alterations, enhanced transparency, and intensified aid to smallholders. The set Living Income Reference Prices constitutes one of the most fundamental milestones in the industry attainment goals of the living income mark.
It is critical that farmers are able to earn acceptable livelihoods as the cocoa sector responds to changing markets and increased demand. By maintaining an active support for long-term price controls, Fairtrade is able to further their goal of improving and sustaining the cocoa economy.
