Ecuador & Peru, producers of high quality cacao for niche markets

Cacao is a very demanded product worldwide, mostly because you can make delicious chocolate of it, and it is said to have health benefits: it helps blood circulation, it is an anticancer agent, a brain stimulator, an aphrodisiac, and it produces feelings of happiness. That is if you buy the dark chocolate version high in cacao percentage 🙂

Some investigations state that the origin of cacao lies in the high Amazon region where the borders of Ecuador, Peru and Colombia meet. However nowadays the major cacao-producers in the world are African. The worldwide leader is Ivory Coast which supplies 30% of total production of cacao. Other big producers are Ghana, Indonesia, Cameroon and Nigeria. Behind these countries Latin American countries follow, with Brasil as biggest producer in this region, and followed by Ecuador, Peru, the Dominican Republic and Colombia. The major importers are European countries and the United States.

Today I will focus on 2 Latinamerican cacao-producing countries, namely Ecuador and Peru. Ecuador because it is known as the first producer in the world of high quality Fine Aroma cacao and Peru, because it is the second producer worldwide of organic cacao.

The cocoa of Ecuador is called Arriba or Nacional, because it grows only in Ecuador. The main feature of the Ecuadorian cacao is a unique floral flavor unmatched in the world. Although Ecuador produces only 4% of the world production of cocoa, however from the fine upper class cocoa, the country is responsible for 70% of the world production. It is produced in coastal zones and in the Amazon of Ecuador. Ecuador also produces a clon variety, called the CCN-51. This variety has higher productivity, but is of lower quality and taste.

With this knowledge in my head, last year from August 30th to September 1st 2017 I attended the 5th World Cacao Summit in Guayaquil, in Ecuador to explore business opportunites in representation of my own consultancy KROONABLE. Government officials of the highest level and representatives of the major cacao organizations were present at the opening and the panel-debate. Hearing their comments about the cacao-sector I became even more aware about the enormous importance of cacao, not only for the economic development of their own country but also in providing high quality cacao to the rest of the world. It is therefore no suprise that cacao is a symbol product in Ecuador. Here below some pictures of the 5th Cacao Summit :

There is also a shadow side to the cacao production. The profits in the cacao value chain are unfairly distributed: about 93% of the country’s production is commercialized by large intermediaries who tend to neglect the needs of the farmer. Furthermore, the majority of exported cacao of Ecuador is still conventional, and just a minor percentage has the organic and fairtrade certification. Another harmful effect of large-scale cacao cultivation in Ecuador has been deforestation and the concentration of lands in small groups of families.

Peru is said to be the second producer in the world of organic cacao. Major regions of cacao production are San Martin, Junin, Cusco, Ucayali, Huanuco, Ayacucho and Amazonas. Peru grows Trinitary, Amazon foreign and Creole cacao varieties. The Creole variety is of higher quality resulting from greater fat content and it adapts well to agroforestry systems where organic cacao is increasingly grown to meet expanding demand. Agroforestry is the main production system for organic cacao farmers in Perú and the number of farmers switching to this practice is slowly rising as they can see how their fellow farmers improve their yields and are more resilient face to the climatic changes in the region.

So, Peru really focusses on high quality organic and fairtrade cacao to get better prices for their cacao. The international cacao market is very competitive and it is their only way to differentiate itself from other countries.

In Peru cacao-production also has some harmful effects. Although cacao cultivation in itself does not harm the environment, fast deforestation has taken place in the Amazonian jungle due to large-scale cacao plants, for example in the region Loreto between 2013 and 2014.