Craft Chocolate: When Direct Trade Is Not So Direct After All

If craft chocolate had the budget to advertise on TV, this would be the scenario:

“A muscular bearded guy together with his beautiful wife. They both carry heavy bags of cacao beans on their shoulders in an exotic jungle with the sunset on the background. As they get closer to the screen, they proudly claim that they are craft chocolate makers. That they travel to far-away countries to directly source their beans and provide their customers with the best and most ethical chocolate ever. Final slogan: Because we care.”

Nice movie, but it isn’t exactly what happens in real life.

There are different ways for craft chocolate makers to get cacao beans. Mainly three.

They can buy them from distributors in their own country. It doesn't require importing fees and the quality of the beans is mostly guaranteed. They can also buy from distributors in other countries nearby. If they don't like the selection in their home country, they have a look around the neighborhood to see what's good.

Other craft chocolate makers go a step further, importing cacao beans from distributors based in the countries of origin. A decent amount of cacao is ordered to be transported on big containers across the ocean to be delivered at the maker's door. This strategy is definitely more troublesome than getting the beans from a developed country that already imported them.

A third option for chocolate makers is to source the beans by themselves. This means travelling to the places of origin, knocking on farmers' doors, making agreements for the next crop and taking care of the entire logistics to get the beans at their factory. This is the riskiest, most expensive strategy. Many are the stories of big money lost on promised cacao that was never delivered. Although some craft chocolate makers can take pride in using this strategy, the majority of craft chocolate makers seldom go this route, preferring to rely on distributors in loco.

Out of the three options, the last one is definitely direct trade. When makers deal directly with the farmers, that is the quintessential of direct trade. Even if they use the help of local intermediaries, farmers still have an agreement with the makers and nobody else in between. The misunderstanding comes when makers that buy from distributors appoint their chocolate bars as the result of Direct Trade.

Of course, much credit has to be given to those craft chocolate makers who travel the world to make sure about the source of their cacao. You will see pictures of them in exotic jungles, smelling beans and shaking hands with farmers. After all, ethics and transparency are important values in the craft chocolate community.

But can THIS be called Direct Trade?

There is no “direct trade” if the chocolate company doesn’t make agreements directly with the supplying farmers.

Visiting cacao plantations in the places of origin is honorable, but nowhere near a direct trade.By definition, direct trade is a business model where the producer deals directly with the customer. They sign a contract and make agreements together that are mutually beneficial. The majority of craft chocolate makers don't make deals with farmers themselves, but with distributors in loco.

No agreements are made between the maker and the farmer. No worries about how the cacao will get from the jungle to the port of the main city to the importing country. No clue about the local rules and legislation. Chocolate makers place an order and wait for its delivery.

This is an understandable scenario and makes a lot of sense for the geography of the cacao industry.In fact, cacao farms are located in rural areas and are of the size of 3 to 5 hectares. Unfortunately, this is not enough cacao to justify high costs of transportation. It would be a huge effort for farmers to figure out the entire logistics for their beans and pay for it. For the farmers' sake, there are distributors in loco who collect cacao from multiple farmers, pay them a (hopefully) fair price, find adequate clients and safely deliver.

The size and the location of cacao farms make direct trade extremely hard by definition. Without substantial investments, it becomes very difficult for chocolate makers to organize everything directly with the farmers. Even if we don't like the idea, middlemen are still quite needed in the industry, and we can only hope they have the best intentions.

The dilemma still remains: can cacao bought from Emily from Uncommon Cacao in Guatemala, from Simran from Kokoa Kamili or from any other fine cacao distributor be appointed as "directly sourced or traded" by the chocolate makers?

No doubt that cacao distributors in loco make direct trade with the farmers. But chocolate makers do not. They simply buy from the distributors, visiting the countries of origin when and if they want to.There is a profound difference between visiting producers and dealing directly with them. An entire set of difficulties lies between direct trade and non-direct trade of cacao.

"We directly source the beans from the places of origin" is a misleading claim that many chocolate bars don't deserve to carry on their packaging. It is an injustice to those craft chocolate makers who truly get the trouble to make agreements directly with farmers.

Traceability and ethics are not in doubt here. Craft chocolate makers are known for sourcing cacao from excellent distributors and sharing a lot of info about them. But even traceability and ethics don't imply direct trade, and the cacao that is not the result of a direct agreement with the farmers should not be called "directly traded or sourced".

What is your definition of Direct Trade for cacao?