Hunting For Cacao

SOURCING: WHERE DOES MAROU’S CACAO COME FROM?

From Day 1, all Marou chocolate has always been made with cacao grown and sourced in Vietnam.

Something worth mentioning is that the “cacao industry” we found in Vietnam was the result of a failed experiment. In 2000 or so big industrial cacao buyers decided to encourage cacao in Vietnam with the idea that it would alleviate their dependency on places like the Ivory Coast or Indonesia. It didn’t work in the sense that cacao never got to the scale that they wanted here. But it was big enough for us to find cacao farmers and select from their best beans to create Marou Chocolate.

IS YOUR SOURCING ETHICAL?

If you mean that no harm was made to people or the environment in producing the cacao used to make our chocolate, then yes! We do care a lot about where the cacao comes from and we do our best to improve this all the time.

HOW DOES IT WORK ON A PRACTICAL LEVEL?

Basically we work with 15-20 farmers who are cacao fermenters: five or six guys in Tien Giang, and 2 or 3 in each of the other 5 provinces where we source cacao…

Basically it’s a tight group of people with whom we’re working on the long run. These guys’ farms are never really big enough for them to work solely with the pods they grow on their own land, because you need a critical mass to do a good fermentation, so they also buy fresh cacao pods from their neighbours, but the fermenter is responsible for the processing and the quality of the cacao, so he’s our main partner.

When we buy from farmers who do fermentation, we pay good money for their beans and the idea is that they in turn pay good money to their neighbors. If they don’t (and occasionally they don’t!) the neighbors get fed up and replace their cacao with something else. Of course it’s hard for us to control the level of greed that individual farmers are going to apply in their relationship with the other guys. But we’re trying to make them understand that its in their own best interest to share some of the spoils—that if we pay more money for beans, they should be paying more money for pods.

WHAT WOULD HAPPEN IF MAROU DISAPPEARED TOMORROW FROM VIETNAM’S CACAO MARKET?

The general trend is that Vietnam’s cacao market is small and isn’t really growing. It’s kind of been shrinking, in fact.  I think we’re pulling the market up. We provide demand and we pay a good price for the cacao. If we were not there I’m not saying cacao would completely disappear, but it would certainly be less dynamic and less dedicated to quality. If you turn the question around and ask what would happen if cacao were to disappear in Vietnam, we would be in real trouble!

MAROU SAYS IT WORKS DIRECTLY WITH FARMERS. DOESN’T EVERYONE BUY CROPS FROM FARMERS?

No, commodity traders rely on middle-men. And we’re trying really hard to cut the middle-men and not just for the fun of it. We’re cutting middle-men so we can control the quality of our cacao directly at the farm, give direct feedback on quality and provide farmers with a way to maximize their income, as a result their cacao business is sustainable and we can continue relying on them to provide us with top-quality cacao

CAN WE TALK ABOUT MONEY?

Sure. As you know, there’s a global market price for cacao. At the moment (April 2017) the global market price is so low I doubt you could buy anything in Vietnam at that price. In the last six months, cacao lost nearly a third of its value. It used to be around $3,000 per ton. Now it’s $2,000. [Ivory Coast cocoa board just dropped the amount it pays to farmers down to 750 FCFA = 1,220 USD per ton]. So it may sound strange, but as market prices were collapsing we actually decided to increase the price we pay for cacao, not just as a % of the market price, but in absolute terms.

OK, WHAT DO YOU GUYS PAY THE FARMERS?

More or less twice the market price. 96,000 VND = 4,160 USD /t at the farm, for top quality cacao, more than 3 times what African farmers get.

WOW. SO YOU’RE RIGGING THE CACAO MARKET IN VIETNAM?

Well that’s the whole point. At the current, low prices growing cacao is no sustainable, not in Vietnam where farmers have the possibility to grow anything they chose. And for us it needs to be sustainable because we rely on the supply of cacao from Vietnam in a way that nobody else does. And that’s why we’re working on a real supply chain that’s sustainable and high-quality. And we’re doing that with 15-20 farmers who are all making a good living. But they’re all from the same generation who benefited from the re-distribution of land in the 1980’s when Vietnam stopped collectivizing land and said “here’s a plot of land; it’s yours.” I think it’s fair to say that they started out pretty poor and they’ve made a good living.

SO WHAT HAPPENS NEXT?

Well, the size of these farms is not really optimal. They’re really small pieces of land. So as farmers retire and fewer of them remain, there’s probably going to some concentration. In some other places, farmland is going to disappear because of creeping urbanization. This is particularly true in the Mekong Delta. One of our farms in My Tho is more or less in the middle of the city…

That’s why we’re also looking at things like our agro-forestry project (hyperlink) as ways to plant cacao on a larger scale on converted rubber tree or coffee farms for example.