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Colombia commits itself to cacao

cacao

Colombia commits itself to cacao

The first two ICA-registered cacao clones and the decision to plant a further 100,000 hectares together make for interesting investment opportunities in the sector in Colombia.

Cacao, a grain whose origin dates back to the 9th century B.C. and which was even used as currency in Pre-Hispanic Mexico, is nowadays an investment alternative in Colombia, where a production figure of 50,000 tonnes is envisaged this year.

Why is it attractive to invest in this perennial crop which is planted at heights of less than 1,200 meters above sea level, takes five or six years to produce the first harvest, and whose price, as with any agricultural product, depends on local and worldwide supply and demand?

The answer is simple, and the figures confirm it. The world currently produces 3.9 million tonnes of cacao, and the Ivory Coast, in Africa, tops the list with 1.6 million tonnes. The International Cacao Organization (ICCO) nevertheless calculates that there will be a worldwide deficit of 156,000 tonnes of cacao in 2014, and if production does not increase, in 2020 there will be a shortage.

And this is without taking into account the fact that only 5% of total world production is of cacao with a fine flavor and aroma, which is precisely the type of cacao produced in Colombia, where the entire harvest goes to the domestic market.

“Our cacao is good, but it’s not known around the world”, says Eduard Baquero López, Executive President of the National Cacao Producers Federation, a non-profit organization formed in 1960 which is a member of the National Cacao Council and manages monies through the National Cacao Fund that are specifically allocated to sector support activities.

Other countries are unaware of our great potential, simply because the country’s entire production is purchased by confectionery and chocolate sector companies such as Compañía Nacional de Chocolates, Casa Luker, Colombina and Aldor, which produce solid chocolate for making a chocolate beverage and other items.

Unlike the rest of the world, most of the chocolate consumed in Colombia is in liquid form and with low cacao percentages, whereas chocolate confectionery with a cacao content of more than 70% is preferred in Europe.

Plant and renew
Colombia has been self-sufficient in cacao since the 1980s and has only imported at certain times, because production has also been growing. According to Fedecacao figures, 37,000 tonnes were produced three years ago, 41,000 two years ago, and 47,000 in 2013.

Local industry demand is around 40,000 tonnes, on average. With the surplus last year, 7,000 tonnes were therefore exported to countries like Mexico, Italy, Spain, Belgium and France.

Encouraged by the increase in worldwide demand and because cacao also has the potential to replace illicit crops, the national government’s Ministry of Agriculture is fostering the planting of a further 100,000 hectares of cacao and the renewal of 80,000 old hectares of the crop over the next two years.

The government’s target is to achieve a figure of one million new hectares planted, with a view to surpluses being produced for export and to making Colombian cacao with a fine flavor and aroma known on the world market.

To achieve this, the country has around 50,000 farmers, each with an average of 3.5 hectares, meaning there are 150,000 hectares in total already planted, in and around 350 municipalities. The main producer town is San Vicente de Chucurí, in Santander province.

“Cacao is an ideal substitute for illicit crops. We’ve planted cacao in many places where coca used to be grown, and the farmers now earn their living from a worthy, legal activity with adequate funds, but these are still isolated efforts”, explains Baquero López.

It costs an average of ten million pesos to plant one hectare. How soon the million hectare target is reached will therefore depend on how quickly funding can be obtained and the interest shown by potential investors, because the effort could take a decade and the plantation last a century.

Analysts estimate that the renewal process will result in production at least doubling at plantations that are today producing between 150 and 300 kilograms per year.

César García, the chocolate, confectionery and raw materials sector manager for the Production Transformation Program (PTP), which is attached to the Ministry of Trade, Industry and Tourism, explained that with sufficient investment in crops, the country could eventually produce 1.5 or 2 tonnes per year per hectare, figures that are similar to those achieved in countries like Ecuador, Venezuela and the Dominican Republic, which also produce a fine cacao with aroma.

New clones
The lack of suitable vegetable matter has also prevented Colombia from increasing crop productivity. The Ministry of Agriculture and the Colombian Farming Research Corporation (Corpoica) have nevertheless just released the first two cacao clones registered in Colombia, which will simplify crop standardization and productivity for farmers.

According to the Ministry, these clones are noted for their stability, grain size, precocity, productivity, and resistance to disease. At the same time, the vegetable matter will pave the way for financing, because demand from the international market is envisaged.

The clones retain the fine cacao with aroma characteristics that have typified the Colombian grain. The next step is to propagate them so they can be acquired and grown in the different cacao production areas around the country, because they meet international standards.

The government, the business community, agro-industrialists and farmers are also working hard to strengthen associations, so that it will be possible to also draw an organoleptic map that will enable Colombian cacao characteristics to be identified by production region.

“The PTP carried out a pilot program and Corpoica will help cacao farmers to identify characteristics, so that these can be a commercial tool, but it’s a process that could take two or three years”, explained García, after insisting that certain characteristics could be deemed ‘premium’ on the international market.

If the full organoleptic map is produced, farmers will be able to improve post-harvest processes, because according to the National Cacao Council, 60% of the quality of Colombian cacao is lost in those processes.


Did you know?

  1. 1.  Colombia is one of the few countries in the world where solid chocolate is used for making a chocolate drink.
  2. 2.  Ecuador produces cacao solely for export.
  3. 3.  Peru is concentrating on producing organic cacao.
  4. 4.  Cacao supplies in Africa are declining because of climate change.
  5. 5.  A Colombian consumes an average of two kilos of cacao per year (even if every day he drinks hot chocolate, which has a low cacao content).
  6. 6.  Someone from Switzerland, a Belgian or a European consumes up to 16 kilos of cacao per year, because of the high cacao content of chocolate bars and sweets.
  7. 7.  Colombia has identified 600,000 hectares of land where top quality cacao can be produced.
  8. 8.  Investors can forge alliances with sector companies such as Nutresa, Aldor and Colombina for placing Colombian cacao on international markets.
  9. 9.  The average purchase price for cacao is currently COP 5,100 per kilogram.
  10. 10.  China and India are starting to consume cacao.


“Nowadays, Colombia potentially has access to roughly 1,450 million possible consumers, as a result of commercial agreements that have been signed”. Santiago Rojas Arroyo, Minister of Trade, Industry and Tourism.

“We have a strong business base, one that wants to be innovative and enterprising; the state is offering a number of instruments to ensure this. We are working with the regions on competitiveness, internationalizing the economy, and exploiting existing agreements”. Santiago Rojas Arroyo, Minister of Trade, Industry and Tourism.

“This step that is being taken will have not just a regional impact, but a national one as well, because these clones are going to be tested in other parts of the country, and the eyes of the world will be on us”. Rubén Darío Lizarralde, Minister of Agriculture.

 

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