In order to combat the threat of the farmers losing out during the liberalisation of the cocoa market in 1993, a group of cocoa farmers including a visionary farmer representative on the Ghana Cocoa Board, Nana Frimpong Abrebrese came together to form a co-operative that would collect and sell its own cocoa for the member farmers' own benefit. Supported by Twin and SNV, a Dutch NGO, they set up their own company to buy their cocoa and sell it on to the Government Cocoa Buying Board. The cocoa farmers' organisation was founded and named "Kuapa Kokoo" which in the local language, Twi, means "Good Cocoa Farmers Company". Their motto is "Pa Pa Paa" which means "the best of the best of the best".
The organisation is for farmers and set up by them with the mission to effect:
- increased power and representation within the market for the farmers
- social, economic and political empowerment
- enhanced women's participation in all its affairs
- environmentally sustainable production processes
This is made up of village societies that elect society committees and representatives at regional level, who in turn elect representatives to the national Kuapa Kokoo Farmers Union.
Kuapa Kokoo Limited
the trading arm of Kuapa Kokoo
which is responsible for distributing money for community projects, generated from the fair trade premium between the farmers
Which provides credit and banking services for the farmers
Click here for more details about the structure of Kuapa Kokoo
Member farmers are no longer cheated as they are by other cocoa buying companies. For example Kuapa Kokoo has a strong reputation for using accurate weighing scales and using scales that are understood by illiterate farmers. The farmers are encouraged to check the scales against things of a known weight. Kuapa has commissioned the production of "weight stone", equivalent to a full, single sack of cocoa which are carried in Kuapa Kokoo vehicles and operations staff carry out official random checks to ensure the village recorder is using accurate scales.
Kuapa prides itself on its democratic nature and all decisions affecting the farmers are taken by elected representatives.
Kuapa has created operating methods which are extremely cost efficient, for example it trains its own members to carry out processes such as the weighing and bagging of the cocoa. Not only does this mean that the farmers benefit by learning additional skills but these internal efficiencies means that Kuapa can pay the farmers more per sack than other buying agents.
At the end of each year, the farmers are paid a cash bonus on a per sack basis. This comes from money gained from their efficient practices and the fact that all the profits are returned to the farmers themselves.
In 1996 it was decided that credit sales should be publicly recognised and promoted given their significant contribution to Kuapa Kokoo's financial performance. When Kuapa takes delivery of a farmer's cocoa, traditionally the farmer was paid immediately. This meant Kuapa had to borrow money, often with rates as high as 30%, to finance this until it received its own payment from the government monopoly buyer, Cocobod. Under the deferred payment system, if the farmer agrees to wait for payment until Kuapa is credited for the sale, Kuapa will pass on some of the money saved from the interest which would have been payable on the loan. Often whole villages will agree to defer payment, and so the entire community can benefit from this extra income.
Kuapa also buys items such as agricultural tools at bulk purchasing rates, again passing these savings onto the farmers.
Village societies that have performed particularly well, either on the basis of their operating practices or good management, are rewarded at the AGM with items such as machetes or gum boots for use by the whole village.
Asensua's Women's Group soap project
Gender awareness in Kuapa aims to enhance the active and effective participation of women in decision making throughout the organisation. Measures have been introduced to ensure that a minimum number of members of the various councils and committees are women. Further special seminars and workshops are organised for women on a wide range of issues, for example nutrition, child care, health and credit facilities.
Kuapa has also supported income generating activities to supplement their incomes and to make them less dependent on their men as well as provide money for the family during the off season whilst the cocoa is growing. For example they have set up a project making soap from the potash produced from burnt cocoa husks. This soap is then sold, generating additional income from the waste cocoa materials. They have also provided women with machines for cracking palm kernels for cooking oil, this is far faster than the traditional method of using stones to crack the kernels.
Read more in the Big Issue article
Download Chains of Fortune for the chapter by Pauline Tiffen, Jacqui MacDonald, Haruna Mamaah and Frema Osei-Opare called 'From tree-minders to global players: Cocoa farmers in Ghana'.
Kuapa Kokoo sell about 1000 tonnes of their yearly output to the European Fairtrade market. This means that, providing their production methods meet internationally audited conditions regarding, for example, minimum health and safety conditions and that the organisation is democratically run, the producers receive a guaranteed price for their goods and the security of long-term trading contracts. In the case of cocoa, recent prices on the world market price have fallen as low as $1000. In comparison, on the fair trade market they receive $1600 per tonne, plus an extra $150. Even if the world market price reached $1600, the Fairtrade price would still include the extra $150 on top of the world market price.
Kuapa Kokoo decided that another way to increase profits from their cocoa, as well as their knowledge of the western chocolate market, was to produce their own, branded chocolate bar for sale in western markets. In October 1998 Twin Trading and Kuapa Kokoo came together, along with The Body Shop, and supported by Christian Aid and Comic Relief, to found The Day Chocolate Company. The company was named in memory of Richard Day, a key member of the Twin team that worked closely with Kuapa Kokoo and who sadly died before seeing the chocolate company coming to fruition. In January 2007, the Board made the decision to change the company name to Divine Chocolate Ltd, and in July 2006 The Body Shop handed their shares to Kuapa Kokoo, so the cooperative now owns nearly half of the company. Two elected farmer representatives sit on the board of Divine Chocolate Ltd and a board meeting is held in Ghana every year.
The first Divine chocolate bar - launched in 1998
The company was formed to launch Divine Fairtrade milk chocolate, which is now available in supermarkets nationwide. As well as sharing in the profits, the farmers have a say in decisions about how the chocolate is produced and sold and increase their knowledge of the fiercely competitive European chocolate market.
Kuapa also sells to other fair trade buyers in Europe. The Body Shop buys cocoa butter made from Kuapa's cocoa and includes it in 26 products including its Africa Spa range and Traidcraft also both use cocoa from Kuapa in some of their products.
The Credit Union provides loans to members at competitive rates, as well as providing information and advice on savings and careful spending.
The Growth of Kuapa
The proof of these benefits can be seen in the growth of the number of Kuapa Kokoo societies. Despite the process of joining being a lengthy and formalized process, there is a growing waiting list of villages wanting to join. Training is all done "in-house" and the company employs 33 Research and Development Officers as part of its operations team to work with members at a village level supporting the education program and supervising elections. The buying and logistics as well as management systems have been gradually "regionalised" and by the 2004/5 season, Kuapa was operational in 26 areas, with around 1200 village societies and 45,000 farmer members. The proportion of women farmers has grown from 13% to nearly 30%.
More details about the creation of Kuapa Kokoo
For an excellent archived issue (1998) of The New Internationalist Magazine that features Kuapa Kokoo and the Ghanaian cocoa industry in great depth go to http://www.newint.org/ and see Back Issues.
Download Monitoring and Evaluation the report by Lorraine Ronchi Monitoring the Impact of Fairtrade Initiaves: A Case Study of Kuapa Kokoo and The Day Chocolate Company.
Link here to the Kuapa Kokoo website
View Reuters film of Kuapa Kokoo |