“Weeks ago, a farmer who was once rich sought out a friend, also a cocoa producer, to discuss a delicate matter. ‘I need some money and I trust our friendship enough to know that you’ll help me,’ he said. The friend was expecting to lend some money, imagining an amount around ten or twenty thousand. ‘How much do you need?,’ he replied, to which the farmer said, without raising his head: ‘a couple of hundred, just to buy this week’s groceries.”

This text was written in April 1995 and published by Gazeta Mercantil, a now-defunct economic newspaper. It illustrates the brutal downfall Brazilian cocoa producers experienced from the 1980s into the 1990s. Famous barons, known as coroneis (the colonels), controlled the world’s second-biggest cocoa producing region. Histories of their lavish lives are engraved in popular culture—and immortalized by the work of writer Jorge Amado.

Lighting Cuban cigars using USD 100 bills were a common thing in the region. Until the 1970s, cocoa beans were the main revenue generator in the state of Bahia—accounting for 60 percent of the wealth in the region. Then, international competition—coupled with a major plague—destroyed the cocoa business in Bahia.

</span></p> <p><span style="font-weight: 400;">Now, the region is slowly trying to get back on its feet, focusing less on quantity, and more on the quality of their beans. </span></p> <h2>The rise of Brazil&#8217;s cocoa country</h2> <p><span style="font-weight: 400;">Cacao trees are native to the Americas&#8217; tropical forests, with a deep historical connection to indigenous peoples. The Aztecs—who already produced a rudimentary version of chocolate in pre-Colombian times—treated cacao trees as sacred, due to the beans&#8217; energetic power. In Brazil, the Amazon was the birthplace of cocoa beans. The first seeds would only reach southern Bahia in the 18th century, brought by Jesuit </span><a href="https://brazilian.report/guide-to-brazil/2017/09/25/colonial-brazil/"><span style="font-weight: 400;">settlers</span></a><span style="font-weight: 400;">. </span></p> <p><span style="font-weight: 400;">The hot and humid climate made it easy for the beans to adapt to the region. The presence of taller vegetation—which provides the shade cacao trees need to grow—was also crucial. Due to a lack of investment by the Portuguese Crown, the south of Bahia remained practically untouched until that point.</span></p> <p><img class="alignnone size-full wp-image-19176" src="https://brazilian.report/wp-content/uploads/2019/06/shutterstock_636771289.jpg" alt="cocoa tree brazil" width="1000" height="667" srcset="https://brazilian.report/wp-content/uploads/2019/06/shutterstock_636771289.jpg 1000w, https://brazilian.report/wp-content/uploads/2019/06/shutterstock_636771289-300x200.jpg 300w, https://brazilian.report/wp-content/uploads/2019/06/shutterstock_636771289-768x512.jpg 768w, https://brazilian.report/wp-content/uploads/2019/06/shutterstock_636771289-610x407.jpg 610w" sizes="(max-width: 1000px) 100vw, 1000px" /></p> <p><span style="font-weight: 400;">&#8220;In the 19th century, there was a massive inflow of people to the region, fleeing massive droughts in Sergipe and northern Bahia. The migrants were impoverished and mostly illiterate, and came with their families,&#8221; wrote a group of economists from the State University of Santa Cruz, in an essay about the history of the cocoa economy in Bahia. This migration set cacao crops apart from other plantations, as they were much less reliant on slave labor—it was more of a relationship between dominant </span><i><span style="font-weight: 400;">coroneis</span></i><span style="font-weight: 400;"> who preyed upon small producers. </span></p> <p><span style="font-weight: 400;">Almost the entirety of the production was exported, and Brazil led cocoa exports around the world until the 1920s. The crop&#8217;s heyday was also marked by a veritable war among landowners who sought to expand their domains. Land-grabbing schemes and ambushes became an everyday affair in the region.</span></p> <h2>The decline</h2> <p><span style="font-weight: 400;">It is impossible to dissociate the history of cocoa production from hiccups, crises, and bailouts from the government. That was the case in 1929, after the crash of the New York stock market, and in the 1960s, when the massive production in West African countries pushed international prices down (from USD 4,000 in the 1970s to roughly USD 800 15 years later). But no crisis would be as crippling as the one which hit the region in the 1990s.</span></p> <p><span style="font-weight: 400;">At the same time prices were heading down, Brazilian producers detected a devastating plague which decimated the cacao trees. In a matter of three years, a fungal disease called Witches&#8217; Broom damaged 40 percent of the region&#8217;s production, putting most farmers out of business. Over 200,000 people lost their jobs. There are some reports the disease was introduced on purpose, to undermine the elite cocoa class.</span></p> <p><span style="font-weight: 400;">To make matters worse, the cacao branch of the Agriculture Ministry (CEPLAC) responded to the crisis with two misguided recommendations. The first was to cut down the infected trees, which lowered the forest crown needed to maintain ecological balance. The second was to plant cloned cacao trees as replacements.</span></p> <div class="flourish-embed" data-src="visualisation/422267"></div> <p><script src="https://public.flourish.studio/resources/embed.js"></script></p> <p><span style="font-weight: 400;">Not only did the lowering of the forest crown cause the disease to spread quicker, but the cloned replacements did not bear any fruit. Farmers were left with acres of unusable land. In 1996, Brazil exported USD 65.8 million in cocoa beans. Twenty years later, that number dropped by 95 percent, to just USD 3.03 million. “Bahia is a still a state of ghost towns,” says Marco Bonamico, a cocoa fermentation specialist living in Ilhéus. </span></p> <p><span style="font-weight: 400;">During the </span><a href="http://atarde.uol.com.br/bahia/salvador/noticias/1257586-entenda-o-caso-da-vassoura-de-bruxa"><span style="font-weight: 400;">Witches&#8217; Broom epidemic</span></a><span style="font-weight: 400;">, technicians found infected branches tied to cacao trees—essentially proving the infection was an act of bioterrorism. At the time, many talked about an international conspiracy led by West African producers. </span></p> <p><span style="font-weight: 400;">Seventeen years after the plague was first discovered, a Workers&#8217; Party militant told </span><i><span style="font-weight: 400;">Veja </span></i><span style="font-weight: 400;">magazine he and another left-wing activist were behind the epidemics. According to his accounts, the duo traveled back and forth between Bahia and the Amazon taking fungus from different regions to destroy the cacao plantations. While there is reasonable cause to believe the infection was deliberate, the militant&#8217;s account was challenged by experts—who say his story doesn&#8217;t check out. </span></p> <p><span style="font-weight: 400;">Bahia&#8217;s Witches&#8217; Broom plague was caused by two varieties of fungus, while there are millions in the Amazon. According to a study published by the </span><i><span style="font-weight: 400;">Mycological Research</span></i><span style="font-weight: 400;"> journal, it is nearly impossible for infected branches from different regions to contain only two varieties of the plague.</span></p> <h2>The rebirth: bean-to-bar chocolate</h2> <p><span style="font-weight: 400;">The cocoa barons Jorge Amado wrote about don&#8217;t exist anymore. Once responsible for 20 percent of the global cocoa production, Brazil now accounts for only 4 percent. But the state of Bahia is starting to regain ground as a leading producer. Instead of large farms, what we see now are small producers driven by a growing international demand for premium beans.</span></p> <p><span style="font-weight: 400;">And many producers use sustainable methods as a way to preserve the forest—and enhance the value of their product. </span></p> <p><span style="font-weight: 400;">Cocoa beans from the south of Bahia are produced in the shade of the Atlantic Forest. They&#8217;re part of a system known in the region as </span><i><span style="font-weight: 400;">cabruca</span></i><span style="font-weight: 400;">, which uses certain crops to help conserve rare tree species. </span><i><span style="font-weight: 400;">Cabrucar</span></i><span style="font-weight: 400;"> is a local term meaning “to open holes,” as the cacao trees are planted in small pockets surrounded by the forest. A few years ago, scientists from the New York Botanical Garden found more than 476 different species of vegetation in the region that had been preserved by responsible planting methods. “Cacao trees need shade to grow, and we plant it among native trees without devastating the forest,” explains Mr. Badaró.</span></p> <p><span style="font-weight: 400;">The rebirth of the cocoa crops bolstered a chocolate-centered tourism industry in the south of Bahia. Local producers are investing to offer a complete tour of the cocoa farms—from plantation to harvest, but also how the seeds become one of the world&#8217;s most delicious sweets. Those with more time on their hands can also extend their visit to neighboring towns such as Canavieiras, Uruçu, and Itacaré.</span></p> <p><span style="font-weight: 400;">Tourists can also be amazed by the jaw-dropping landscape of the &#8220;Cacao Coast,&#8221; one of the most beautiful in the world, with a mix of waterfalls, beaches, and swamp regions full of fauna and flora. </span></p> <h2>Gourmet is not enough</h2> <p><img class="alignnone size-full wp-image-19174" src="https://brazilian.report/wp-content/uploads/2019/06/shutterstock_1173134788.jpg" alt="brazil chocolate" width="1000" height="667" srcset="https://brazilian.report/wp-content/uploads/2019/06/shutterstock_1173134788.jpg 1000w, https://brazilian.report/wp-content/uploads/2019/06/shutterstock_1173134788-300x200.jpg 300w, https://brazilian.report/wp-content/uploads/2019/06/shutterstock_1173134788-768x512.jpg 768w, https://brazilian.report/wp-content/uploads/2019/06/shutterstock_1173134788-610x407.jpg 610w" sizes="(max-width: 1000px) 100vw, 1000px" /></p> <p><span style="font-weight: 400;">Sustainable farming is also driving cocoa production in other Brazilian regions. Organizations such as Solidaridad, Imaflora and The Nature Conservancy are finding success planting agroforests in the Amazonian state of Pará. Cocoa is not only lucrative for the farmers but as a native plant, it helps replenish land previously used for pasture. </span></p> <p><span style="font-weight: 400;">Solidaridad connects farmers with chocolatiers to produce high-end chocolate bars. This feeds the blossoming gourmet chocolate market, which is growing at nearly double the rate of the chocolate industry as a whole. </span></p> <p><span style="font-weight: 400;">Belgian chocolatier Callebaut, that recently launched its signature ruby chocolate, sources some of its beans from both Bahia and the Amazon region. Its site claims that cocoa from Brazil is “perfect for your premium chocolate bars.”</span></p> <p><span style="font-weight: 400;">According to Marco Froes Nachter, a former agricultural coordinator at Imaflora, gourmet chocolate won’t save Brazil’s cacao industry as “it needs someone to buy the seeds in bulk.” Rather than focusing all their resources producing premium beans, farmers should develop sustainable business models selling to both gourmet and big-name producers.

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MoneyJun 16, 2019

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BY Juliana Costa

Juliana is a growth strategist and contributor to The Brazilian Report