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Mondelēz invests in sustainability goals

By Rod Addy+

21-Oct-2013

Mondelez aims to invest in sustainable cocoa supplies for sites such as its Cadbury plant and research development quality centre in Bournville
Mondelez aims to invest in sustainable cocoa supplies for sites such as its Cadbury plant and research development quality centre in Bournville

Mondelēz International is pouring cash into sustainable farming projects, including $400M in cocoa farms in developing economies, to secure a strong and stable supply base.

Bharat Puri, Mondelēz senior vice president and global chocolate leader, told journalists at a press briefing at its Cadbury Bournville chocolate factory and research development quality centre near Birmingham: “We are committed to investing $400M over the next 10 years to develop cocoa and cocoa farming communities.”

The cash would be pumped into farming communities in the Côte d'Ivoire, Ghana, India, Indonesia, the Dominican Republic and Brazil. Mondelēz estimated it would reach more than 200,000 farmers and benefit more than one million people in these communities.

In addition to using cocoa in the production of chocolate confectionery and drinks, Mondelēz also used cocoa powder in the manufacture of biscuit products such as its Oreo brand.

Reporters heard the world produced 4Mt of cocoa annually, of which Mondelez used 12 – 14%, costing $1.8bn.

Recent reports have highlighted the threat of increasing cocoa prices, driven by poor harvests, to confectionery firms.

‘We have the technology’

The company was therefore working to increase supply quantities to cope with continued growth and increased production through its Cocoa Life programme, said Chris Chilton, associate director, cocoa programme. “We have the technology to enable farmers to double yield.”

Use of the latest planting methods and fertilisers, for example, could significantly increase harvest volumes in Africa and South America, Chilton said.

And he said new breeding techniques could develop cocoa strains resistant to diseases that attacked them. “In Ghana we are working to develop better cocoa varieties resistant to swollen-shoot virus.”

Other projects included work in Brazil to rejuvenate cocoa plantations, where yields were falling as a natural result of ageing, he said. “We work with farmers on how to graft new saplings on to old trees.”

The firm has also set itself the target of creating 1M coffee entrepreneurs out of its coffee bean suppliers by schooling them in production and business skills through its Coffee Made Happy scheme.

Palm oil

Meantime, the company denied use of palm oil in its products undermined its mission to become more sustainable.

Rob Hargrove, head of research and development for Mondelēz Europe and senior vice-president for research development and quality, said palm oil performed a significant role in some of the firm’s products. As a result, it was hard to remove it completely as an ingredient, he said.

“It provides texture and taste.  It is actually essential for some products to work. The question of functionality is critical for stability.”

Clare Leonard, Mondelēz director of scientific and regulatory affairs for Europe, stressed that the company only used relatively small quantities of palm oil for its products.

She added Mondelēz used sustainable palm oil for those products that required it as an ingredient. “There is not a sustainability issue; we use certified palm oil.”

Critics of the use of palm oil in foods claim its cultivation is damaging animal habitats. They also point out that, unusually for a plant oil, it is high in saturated fat and so question its health benefits.

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