Sustainable practices in cocoa production. The role of certification schemes and farmer cooperatives

Many small-scale cocoa producers in Côte d’Ivoire and Ghana grow cocoa on unshaded or low-shaded cocoa plots. This has dire consequences for farm biodiversity, resulting in lower species richness and depleted soils. To measure the extent of sustainable agricultural practices’ use in the cocoa sector, we develop a scale that incorporates dimensions of agroforestry, soil conservation, pest and disease management and farm sanitation. We use a representative data set of more than 1700 cocoa producers in Côte d’Ivoire and Ghana to assess farmer participation in different organizational structures and market channels and their roles in promoting sustainable practices. We apply a multinomial endogenous switching regression model to control for potential selection bias and derive the average treatment effect of the treated (ATT) and the untreated (ATU) for three participation options: 1) certification scheme only, 2) farmer cooperative only and 3) both. In Côte d’Ivoire, econometric results show that joint participation in both a certification scheme and a farmer cooperative leads to a significantly higher sustainability score than alternative options. In comparison, certification scheme membership shows the highest effect in Ghana. Different findings may be explained by differences in the organization of the cocoa value chain across the two countries. Governmental extension services in Ghana provide support to cocoa farmers, which otherwise farmer cooperatives would potentially offer.

JRC.D.4 - Economics of the Food System