Amidst climate change, geopolitical crises, and increasingly complex logistics, the cocoa supply chain faces an unprecedented crisis, compounded by a surge in the exploitation of child labor. 

Climate instability in West Africa, characterized by rising temperatures and reduced precipitation, is destabilizing the cocoa sector, notably in Ghana and Ivory Coast, which collectively contribute to 60% of global cocoa output. 

The fluctuations in climate, along with seasonal floods, create favorable conditions for the proliferation of diseases and parasites that wreak havoc on crops. Additionally, intensive use of pesticides and fertilizers not only jeopardizes the well-being of workers and the environment but also exacerbates pollution and CO₂ emissions through deforestation for cocoa cultivation. Logistic challenges are also on the rise due to geopolitical instability and substantial hikes in transportation and energy expenditures. 

The culmination of these factors has resulted in an unprecedented spike in raw material expenses, with jumps reaching up to +30/40%, consequently driving a corresponding (+15%) upturn in retail prices. Furthermore, the escalation of child labor, which has surged from 31% to 45% between 2008 and 2019 in West Africa, involving the exploitation of 1.5 million children, introduces an ethical and social dimension to the crisis facing the sector.

This scenario presents a severe test for the cocoa supply chain, highlighting the pressing necessity for innovative and sustainable solutions to reimagine the entirety of the chocolate production chain.

Innovation made in Italy for a sustainable future in the cocoa supply chain

In response to global challenges, promising innovations are emerging from the Italian startups’ ecosystem to support the cocoa supply chain. Two pioneering startups, chosen through FoodSeed, the Foodtech acceleration program of the National Network of CDP Venture Capital SGR, have been instrumental in this endeavor. Supported by key backers and co-investors including Fondazione Cariverona and UniCredit, as well as Eatable Adventures, a prominent global Foodtech accelerator serving as a co-investor and operational program manager, these startups are at the forefront of driving positive change in the industry.

Foreverland: introducing Freecao - Carob as a sustainable alternative to cocoa

A pioneering project in the confectionery sector is Freecao, chocolate without cocoa. Developed by the Italian startup Foreverland, this product stands as a sustainable milestone for the chocolate industry. Crafted from carob, a staple of the Mediterranean region where Italy boasts exceptional production, Freecao presents an alternative to conventional chocolate, accompanied by substantial advantages such as lowered transportation expenses and environmental footprint.

This innovative chocolate drastically cuts CO₂ emissions by 80% and reduces water consumption by 90% compared to cocoa production methods  Notably, it offers a healthier alternative due to its gluten-free, caffeine-free, and artificial ingredient-free composition, coupled with reduced sugar content.

Just in time for Easter 2024, Foreverland has introduced the first cocoa-free Easter egg to the market: a 500-gram plant-based product enriched with hazelnuts, lactose-free, and gluten-free.

Blockchain innovation for an ethical supply chain 

Trusty emerges as an innovative startup focused on developing digital infrastructures to make agri-food supply chains transparent, using blockchain technology. With a specific focus on the cocoa supply chain, Trusty collaborates closely with essential stakeholders across multiple tropical nations, offering tools and consultancy services for seamless data integration and collection among farmers, cooperatives, logistic operators, and industries. Its technology, aligned with European regulations like EUDR, tackles pressing issues such as food safety and sustainability. By fostering greater transparency in international trade, Trusty contributes significantly to bolstering consumer confidence in ethically accountable and regulated supply chains.

This Easter, Trusty, in collaboration with Loretta Fanella, a renowned Italian pastry chef, is launching the first blockchain-tracked chocolate egg. Featuring a QR code, the egg provides certification of the cocoa's sustainable origins, aligning with European standards for ethical production. The cocoa mass used in crafting this egg was purchased through Trusty's marketplace, which streamlines sustainable sourcing for businesses, underscoring the startup's unwavering dedication to transparency and sustainability in agri-food supply chains.

"The cocoa sector holds fundamental importance both in gastronomy and in the economies of European countries. However, it is evident that there is a need to redefine the future of the entire supply chain, which today is among the most unsustainable globally," declares Alberto Barbari, regional VP Italy of Eatable Adventures. "With Foreverland and Trusty, we are moving towards a more ethical, sustainable, and innovative direction, helping confectionery companies tackle the significant new challenges of the chocolate production chain under the banner of Open Innovation."