Hershey Signs Groundbreaking Long-Term Agreement with Cocoa Cooperatives Aimed at Improving Farmer Income and Farm Resiliency

Rhea-AI Summary

Hershey has announced a five-year agreement with nine cocoa-producing cooperatives in Côte d'Ivoire, as part of its 'Cocoa For Good' strategy. This strategy involves a 10-year, $500 million investment to address challenges facing cocoa farmers. The agreement aims to:

• Professionalize cocoa farming and improve profitability
• Invest in community-based resources for household wellbeing
• Preserve the environment and strengthen farm resiliency

This move aligns with Côte d'Ivoire's National Strategy for Sustainable Cocoa and builds on Hershey's previous initiatives, including the $40 million Income Accelerator program launched in 2023 and funding for primary school construction in farming communities.

Positive

• Five-year agreement with nine cocoa-producing cooperatives in Côte d'Ivoire
• Part of a 10-year, $500 million 'Cocoa For Good' investment strategy
• Aims to improve farmer profitability and farm resiliency
• Aligns with Côte d'Ivoire's National Strategy for Sustainable Cocoa
• $40 million Income Accelerator program launched in 2023

Negative

• None.

Insights

Sustainability Expert

Hershey's five-year agreement with cocoa cooperatives in Côte d'Ivoire marks a significant step towards sustainable cocoa sourcing. This initiative, part of their $500 million "Cocoa For Good" strategy, addresses critical issues in the cocoa supply chain. The focus on improving farmer incomes and farm resiliency is important for long-term sustainability.

Key aspects of this agreement include:

• Professionalizing cocoa farming to enhance profitability
• Investing in community resources for better household well-being
• Environmental preservation and strengthening farm resilience

This approach aligns with industry trends towards more sustainable and ethical sourcing practices. The long-term nature of the agreement provides stability for farmers and allows for more direct engagement in addressing on-farm challenges. However, the true impact will depend on effective implementation and measurable outcomes over time.

Agricultural Economist

Hershey's agreement with cocoa cooperatives represents a strategic move in securing a stable cocoa supply while addressing socio-economic challenges in producing regions. The $40 million Income Accelerator program launched in 2023, coupled with this new five-year agreement, signifies a substantial financial commitment to improving the cocoa value chain.

From an economic perspective, this initiative could yield several benefits:

• Increased farmer incomes leading to improved local economies
• Enhanced productivity through professionalization of farming practices
• Reduced supply chain risks through stronger farmer relationships

However, the success of such programs often hinges on effective implementation and the ability to create lasting change in farming communities. The alignment with Côte d'Ivoire's National Strategy for Sustainable Cocoa is a positive sign, potentially leading to more coordinated efforts and amplified impact across the sector.

Five-year agreement builds on significant company investments in improving the well-being of cocoa farming communities

HERSHEY, Pa., Oct. 14, 2024 /PRNewswire/ -- Hershey announced a five-year agreement with nine cocoa-producing cooperatives in Côte d'Ivoire. The move is part of its "Cocoa For Good" strategy, a 10-year, $500 million investment by the company to address the complex challenges facing cocoa farmers. The agreement aims to build lasting relationships with farmers that enable a more resilient supply. 

A long-term commitment to improve farmer livelihoods

The announcement coincided with the annual National Cocoa and Chocolate Days held in Abidjan, Côte d'Ivoire. The heart of the agreement is a memorandum of understanding between Hershey, Sucden, and the nine cooperatives which aims to:

• Partner with farmers to professionalize cocoa farming and improve their profitability
• Invests in community-based resources that improve household wellbeing
• Preserve the environment and strengthen farm resilience

Long-term collaboration among the three entities provides stability for farmers and an ability to more directly engage in addressing on-the-farm challenges.

"Improving farmer incomes requires a holistic approach and collaboration across public and private sectors," said Tricia Brannigan, Vice President, Chief Procurement Officer for Hershey. "Collaboration happens best when you have trust. Trust is built over time through strong, long-lasting relationships."

Building resilient communities within cocoa supply chains

This agreement aligns with Côte d'Ivoire's National Strategy for Sustainable Cocoa to ensure a coordinated and lasting approach to addressing key challenges in the Ivorian cocoa sector.

This latest move by Hershey is part of a series of significant investments in the well-being of cocoa farming communities. In addition to its $500 million "Cocoa for Good" investment, Hershey launched its $40 million Income Accelerator program in 2023. It is also funding the construction of primary schools in farming communities, through an agreement with the National Oversight Committee for Actions to Fight Child Labor, Trafficking and Exploitation and the International Cocoa Initiative.

To learn more about how Hershey is supporting the people behind its products through initiatives that improve farmer incomes, prioritize children's well-being and protect the environment, visit https://www.thehersheycompany.com/en_us/home/sustainability/sustainability-focus-areas/cocoa.html.

About The Hershey Company

The Hershey Company (NYSE: HSY) is an industry-leading snacks company known for making more moments of goodness through its iconic brands, remarkable people and enduring commitment to doing the right thing for its people, planet, and communities. Hershey has more than 20,000 employees in the U.S. and worldwide who work daily to deliver delicious, high-quality products. The company has more than 90 brand names in approximately 80 countries, including Hershey's, REESE'S, Kisses, Kit Kat^®, Jolly Rancher, Twizzlers and Ice Breakers, and salty snacks including SkinnyPop, Pirate's Booty and Dot's Homestyle Pretzels.

For over 130 years, Hershey has been committed to operating fairly and ethically. The candy and snack maker's founder, Milton Hershey, created Milton Hershey School in 1909, and since then, the company has focused on helping children succeed through equitable access to education.

To learn more visit www.thehersheycompany.com. 

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SOURCE The Hershey Company

FAQ

What is the duration and scope of Hershey's new agreement with cocoa cooperatives?

Hershey has signed a five-year agreement with nine cocoa-producing cooperatives in Côte d'Ivoire, aimed at improving farmer income and farm resiliency.

How much is Hershey investing in its 'Cocoa For Good' strategy?

Hershey is investing $500 million over 10 years in its 'Cocoa For Good' strategy to address challenges facing cocoa farmers.

What are the main objectives of Hershey's agreement with cocoa cooperatives?

The agreement aims to professionalize cocoa farming, improve profitability, invest in community resources, preserve the environment, and strengthen farm resiliency.

How does Hershey's agreement align with Côte d'Ivoire's cocoa strategy?

The agreement aligns with Côte d'Ivoire's National Strategy for Sustainable Cocoa, ensuring a coordinated approach to addressing key challenges in the Ivorian cocoa sector.

What other initiatives has Hershey (HSY) launched to support cocoa farming communities?

Hershey launched a $40 million Income Accelerator program in 2023 and is funding the construction of primary schools in farming communities.