In 2020, the United Nations Development Program (UNDP) hired Cluster Consulting to identify and analyze the international demand for sustainable and deforestation-free Amazonian cocoa from Ecuador.

Through PROAmazonía, a program of the Ecuadorian Ministries of Environment and Agriculture and Livestock, implemented with the support of the UNDP, the aim was to improve the competitiveness of small cocoa producers in the Ecuadorian Amazon while preserving the Amazon. For this reason, the project was executed between January and September 2020.

The project has high potential. Ecuador is the third largest cocoa exporter in the world, and is known globally for the quality of its fine flavor cocoa. However, most of the cocoa it exports comes from the coastal regions, and there is an opportunity to boost cocoa from small Amazonian producers.

For this reason, the project consisted of an investigation of the productive sector and the demand in Ecuador, in the identification of potential international markets for Amazonian cocoa, in understanding the decision factors for purchasing cocoa in the prioritized countries, and in the definition of a common strategy for cocoa producers in the Ecuadorian Amazon, accompanied by recommendations for improvement for the sector and making presentations to share the results.

There are approximately 15,000 producers in the Amazon that produce around 20,000 tons of cocoa. These are sold in part to foreign importers, exporters and national industries; however, most go to informal intermediaries who pay low prices. For this reason, the main challenge for producers is to find markets with better prices that, in turn, allow the care of the Amazon.

To this end, we identified that there are four segments in the cocoa market, each with different dynamics, strategies, and success factors. These are commodity, certified commodity, fine flavor cocoa and premium cocoa. Currently, trends towards sustainability, the demand for fine and higher quality cocoa, and the requirement for certifications are modifying the market and generating new opportunities in non-commodity segments, which have more attractive prices.

After visiting the main cocoa associations in the Amazon and interviewing 25 international companies from 6 countries and 15 from Ecuador belonging to the four segments, we identified that the opportunity for Amazonian cocoa was mainly in the buyers of fine and premium cocoa, who are willing to pay differentiated prices for quality, for the positive social and environmental impact, and for bringing the experiences of these producers to their final consumers.

However, due to the productive reality of the Ecuadorian Amazon, it is not yet possible to direct all production towards these segments. For this reason, it was recommended to continue strengthening the associations to improve quality and productivity, work on the development of specific aromatic profiles and improve agroforestry and organic production systems. In this way, the goal was set that by 2030, the 10 associations supported by PROAmazonía sell 12,000 tons of cocoa, half as fine and premium cocoa and the other half as certified commodity. In this way, these associations would have a strong impact in the region, increasing their share from 6% to 35% of the total cocoa of the Ecuadorian Amazon.

The results were presented on three different dates to the producer associations, the technical staff of the ministries and national and international institutions of the industry, who validated and enthusiastically supported the recommendations. The findings were also published in an article on the World Cocoa Foundation website.