A Critical Analysis of the Global Cocoa Value Chain

Abstract

Many agro-food value chains have a longstanding history of transnational fragmentation in their global commodity production processes. The cocoa value chain is part of this group, having developed and scaled to commercial capacity as a result of industrial innovation, colonial policies and increased consumer demand for cocoa derivatives in the late nineteenth century. There has been little change regarding the specific characteristics of this buyer-side value chain since then; the batons in the principal links have been passed along a succession of stakeholders through the years, but the key segments and their value-added distributional shares have remained in place; making it an excellent study to apply to questions of heterogenous economic development in a global context.

This work applies critical theories of economic development and Global Value Chain analysis to the qualitative and quantitative data of the participants in the cocoa value chain collected for this study. The intended purpose is to arrive at a better understanding on why almost 90% of the distributional share in the cocoa value chain of approximately USD 83 billion in annual revenues is captured in the developed countries of final demand, leaving little more than 10% to their upstream partners in the cocoa growing regions. The key findings in this analysis demonstrate how historical legacy, structural barriers (both geological and political), heterogenous stages of global development (agrarian versus developed countries), in addition to trade policy and governance, engage at various intervals within the global cocoa value chain to contribute to the chain’s inequitable distribution that continues to persist.