Cocoa traceability rates fail to improve as EU deforestation law looms

The volume of cocoa in Ivory Coast and Ghana that can be fully traced did not increase last year, a major UN-backed report has found, raising questions about how the world's top two cocoa growers will comply with a new EU law banning the import of commodities linked to deforestation.

The new law next year will require importers of commodities and related goods to prove their products weren't grown on deforested land by, amongst other measures, tracing their supply chains down to the plot where their raw materials were grown.

The report, published by the Cocoa and Forests Initiative (CFI), found 83% of directly sourced cocoa in Ghana and 82% in Ivory Coast can be traced in this way, roughly stable vs 2022 levels.

According to the non-profit Trase, however, only around 35% of Ivory Coast's cocoa exports were directly sourced from farmer cooperatives in 2022 — and industry experts say figures for Ghana are similar, if not lower.

Direct sourcing is when a chocolate-maker or trader buys cocoa directly from farmers rather than through a middleman, making traceability easier.

The CFI report said national traceability systems were currently being piloted in both Ivory Coast and Ghana, and that these were expected to yield high traceability figures throughout the supply chain in 2025 when the EU Deforestaion Regulation (EUDR) takes effect.

Complying with the law is critical for Ivory Coast and Ghana, who ship about two-thirds of their cocoa to the EU and where millions of largely poor, rural farmers and their families rely on the industry for their livelihood.

The EUDR has been hailed as a landmark in the fight against climate change but critics, including the European Cocoa Association, say it could end up excluding small-scale farmers from the lucrative EU market while disrupting the bloc's supply chains.

Brussels has come under increased pressure to delay and even to scale back the legislation, including from EU member states.

CFI was launched at the COP23 as a public private partnership between Ivory Coast, Ghana and major cocoa and chocolate firms.

Deforestation is seen as the second leading cause of climate change after the burning of fossil fuels.