Coming Home

 

Chocolate is on its way home. Ecuador is using research results by Motamayor et al (2002)[1] and rebranding itself as the birthplace of chocolate. The origin of chocolate has been hotly contested and researched over the years by historians like Coe, yet genetic research has places the Andean region of Ecuador as the proposed origin of the cacao plant, also known as Theobroma cacao.

.cacaohistorymap

 

(Photo Source: http://www.chocolatereview.com.au/cocoa_history)

In this photo, you can see the various “centres of diversity” that have been proposed over the years. Ecuador falls within the Andean and Cacao centre of diversity, the latter having more importance and supporting research. While much of what we know about early chocolate culture comes from the Mayas and Aztecs, the plant seems to have its origin in the western equatorial region of South America where modern day Ecuador is located. Among the different types of cacao, forastero grows there most frequently. Although Ecuador produces only 4% of the world’s cacao, they produce up to 70% of fine aroma cacao which garners a higher price in the international market[2]. Ecuador’s prized Nacional Arriba brand of fine cacao has made a revival after a drought/bug nearly wiped out the crop in the early 1900s after which it was replaced with CCN-51 until recently. This revival has proved to be incredible in catapulting Ecuador to the top of chocolate connoisseurs charts. BBC even claims that Ecuador might be home to the world’s best chocolate because of its Nacional variety. The Nacional Arriba plant is now used in a number of Ecuadorian-produced fine Ecuadorian chocolates, including a brand named República del Cacao (RDC). In addition to empowering farmers, by being similarly located in the country of bean origin, RDC brings value added processes and ownership to a more local population with the goal of “relocalizing” chocolate. I argue that RDC has created a national brand through its niche as a local harvester and producer although its ultimate audience may not be local. I will analyze the structure and practices of RDC and provide comparisons to evaluate the successes and faults of this company.

Company Overview

Republica del Cacao (RDC), a chocolate company founded in 2009, produces single-origin chocolate from small plantations and cooperatives in various regions in Ecuador and manufactures the product close to the source. Beans are manufactured hours away from where they are harvested, and these techniques have been passed on to create a new generation of Ecuadorian-raised chocolatiers using ancient palates and “secrets” to produce extraordinary chocolate. The company has grown at a rate of 50% a year, and projected hitting 3.5m in 2013 following a 2012 year of 1.7m in retail sales. The company is ambitious and hoping to reach $40m in five years[4]. Leissle notes how consumer demand for products like single-origin chocolate could help companies like this attain incredible growth rates and returns:

Single origin chocolate appeared as interest in food provenance was rising in the U.S., along with increasing demand for organic, local produce.9 Though cocoa is not local to temperate climates (Theobroma cacao is viable only between twenty degrees north and south of the equator), single origin chocolate at least names the place where the cocoa grew—an appealing ‘‘localization’’ of a food whose origins are generally anonymous. (23)

Their mission is to “harvest the best local varieties of Fine Aroma Cocoa and produce the best premium chocolates in Latin America. Our goal is to become one of the best chocolatiers in the world, competing head on, with the most important traditional chocolate experts in France, Belgium and Europe; exposing the Latina American talent as well as its fine cocoa[5].” RDC is truly focused on highlighting the terroir of cacao and “relocalization” of this traditional crop and its production. Their business structure is focused on enhancing and communicating the quality of the product, and their staff is largely Ecuadorian to utilize local knowledge accrued over generations and maintain the cultural integrity of cacao.

Harvesting and Producers

The single-origin nature of RDC comes from small farm cooperatives where various partners work with farmers to ensure high quality products. Because of RDC’s focus on quality, there is constant monitoring of the cacao throughout the process and close interactions with farmers. Companies like Taza Chocolate also work closely with farmers, flying them up to discuss prices and maintaining close personal relationships. Taza publicly announces the average amount that they pay farmers – an extra $500 USD per metric ton above NY ICE price[6]. This provides stability for the farmers who know they will be receiving a fair wage despite market conditions. RDC is more nebulous on the exact or average price they pay farmers, however, it seems to be more contingent on quality than quantity or set price levels. The rationale is that by working to improve the quality, you will improve the price you can garner for your beans.

At 1:20, the farmer/affiliate for RDC explains how the focus on quality is supposed to translate to better prices.

“[Quality control] leads us to get the client’s full trust, and so prices and spreads for cacao are stable. The client wants our product and he offers what is needed to have a good quality cacao.” (1:20-1:40)

In this sense, RDC operates less like most socially conscious companies or labels who use “justice” “fair trade” brands and labels as selling points where price triumphs over quality. For instance, one critique of FairTrade is that it provides a higher price with no assurance or request of better quality and poor maintenance of standards which seems to be the contrary model for RDC[7]. RDC does engage with a fair trade association named APROCA which works with farmers but emphasizes quality over negotiating high prices. In the video below, APROCA demonstrates how it works with the producers to create the highest quality. When RDC mentions their interaction with farmers, in this video and beyond, there is an overwhelming focus on quality, and the steps taken to create quality, combining local knowledge with data-driven research.

Little is mentioned on price although they claim to offer a “fair wage” and pay their producers daily in cash. Cash payments do allow for less traceability in payments but can create ease for the farmer who may not have alternative systems of banking. RDC engages in long-term contracts with its farmers while also paying them daily. These videos clearly communicate the quality excellence that RDC works tirelessly towards and prioritizes above ensuring (instead of assuming) a livable wage.

 Production

Unlike many bean to bar companies, the production of RDC occurs close to the source and involves local Ecuadorian citizens bringing other forms of local, cultural knowledge. All aspects of the bar are produced in a manufacturing facility in Quito, Ecuador. This allows all of the value added to remain in the country of origin and empowers the nationals of that country, financially and socially. Creating an Ecuadorian brand chocolate is also instrumental for building national pride, particularly once it has gained acclaim, and allows this area to reclaim a crop that has often been disassociated with its Meso- and South American roots. Manufacturing the product in country allows for fresher products and increased compensation and job opportunities from which Ecuadorians can benefit. However, it is important to take note that this value added may not directly reach the farmers. This is merely shortening the connection from bean-to-business, but does not completely consolidate it like a company would if it was also owned by those who harvested the beans.

Yet, despite their emphasis on local knowledge and production, RDC has chosen a more Western method of production. This process includes grinding, conching, and tempering. This is to create the smooth texture that has become normalized and desired. Lindt invented the conching process in 1879 to reduce particle size for a smoother texture and a slightly different taste following the introduction of heat[8]. Rich and creamy textures (also caused by the inclusion of cocoa butter) have become highly valued and because of their historical connection are often considered with high-end chocolate.

The video below allows us to take a detailed intimate trip through the process of chocolate. We see the development from roasted nibs (in an earlier video) to a chocolate liquor that is then conched and tempered to be molded using sophisticated technology and industrialized means.

It’s interesting that they chose this method and perhaps not a more traditional type of method like Taza Chocolate. Taza creates its products using a stone-ground method that employs “authentic Oaxacan stone mills called molinillos to grind [the] cacao with granite millstones …[that] minimally refine the cacao beans, capturing their vibrant flavors[9].” Taza seems to rely more directly on the flavors of the bean in a “minimally refine[d]” state as a final product.

othermolinillo

The molinillo has a rounded bottom for grinding and the friction does produce some heat which affects the flavors at a very subtle level. In their claim for superiority amongst their bean, they use production methods that include significant refining. Presilla touches on the benefits of conching acknowledging that more flavor develops when the cacao mass is conched and heated in the conching machines (66). In order to be the “best chocolatiers” they have to not only compete with traditional experts in France, but almost mimic them in their production styles. They combine traditional knowledge with modern production methods to produce a hybrid product with local flavor complexities and Western production outcomes.

Purpose

One of the most interesting questions that the business model of RDC begs us to ask is: who are these chocolates for? As stated before, the mission of RDC is to become the best chocolatiers relying on the ancient history of cacao in the region. Within their mission statement, RDC asserts that “Cacao was born in our country, it is here where it should be best[10].” Thus, the focus is primarily on the final product with less emphasis on socially conscious processes unless they have synergistic results. For instance, supporting farmers to increase quality helps both RDC to have better inputs in its quest for “premium chocolate” and provides a higher income for farmers with more technical skill. In marketing, RDC is at an advantage because by nature of their business model and location they can most effectively employ the “historical” and “traditional” aspect which is commonly invoked with fine and designer chocolates. By attempting to position themselves as the best chocolatiers they must attract a specific crowd, traditionally those who are more high-end. República del Cacao is sold in specialty chocolate stores and its own stores in wealthy, ex-pat neighborhoods of Quito and Guayaquil for approximately $8.99 for 100g bar, though they offer a wide range of products. The products are not available for shipping. This could be due to a tight supply or perhaps a desire to retain the product domestically. A majority of Ecuadorians cannot easily afford or access the product, thus the first option seems more likely. RDC is strongly marketing itself as a premium chocolate brand filling the niche and providing a creative edge by including historical local knowledge. Despite their branding as a national heritage food, it is out of reach for many citizens.

 Conclusion

Overall, República del Cacao stands out for its ability to brand and claim ownership over cacao. Its superb quality has received worldwide recognition and among other local companies, it is putting Ecuador on the map for fine chocolates. RDC is a true source of empowerment in personal development for both manufacturer employees and farmers through guidance and skill development. Although I value the empowerment through localization of the entire supply chain and production, I am eager to how the farmers benefit compared to other bean-to-bar companies and how local consumers are able to interact with and consume the brand. Consumers should assess their own personal convictions in consumption when choosing products. If they are focused on particularly benefitting small farmers as a highly marginalized population, it is important to find companies that explicitly have that as their mission and provide evidence in their accomplishment of this task. For those with a larger focus on international development, terroir, and culture, Republica del Cacao would be a strong choice because of its deep historical connection to the product and its localization of the full supply chain.

 

 

Works Cited

Caselli, Irene. “Is Ecuador home to the world’s best chocolate?” BBC News. June 2013. http://www.bbc.com/news/world-latin-america-22733002

“Chocolate-Making Conch.” Museum of American History: Smithsonian. http://americanhistory.si.edu/collections/search/object/nmah_1301436

“Direct Trade.” Taza Chocolate, Inc. 2014. http://www.tazachocolate.com/About/Direct_Trade_Infographic

Dragusanu, Raluca. (2014) “The Economics of Fair Trade.” The Journal of Economic Perspectives, vol. 28(3), pp. 217-236.

Leissle, Kristy. 2013. “Invisible West Africa: The Politics of Single Origin Chocolate.” Gastronomica: The Journal of Food and Culture. 13 (3): pp. 22-31.

Madell, Samantha. “Cocoa history.” Chocolate Review. 2008. http://www.chocolatereview.com.au/cocoa_history

Mersell, Ian. “Chocolate Whisk.” Mexicolore, 2013. http://www.mexicolore.co.uk/aztecs/artefacts/chocolate-whisk

Motamayor, J.C.; Risterucci, A.M.; Lopez, P.A.; Ortiz, C.F.; Moreno, A.; Lanaud, C.; (2002.) “Cacao domestication I: the origin of the cacao cultivated by the Mayas”
Heredity Vol. 89, Number 5, pp. 380-386.

República del Cacao, Inc. 2015. http://republicadelcacao.com/

Schipani, Andres. “Corporate Watch: República del Cacao on the origin of taste.” Financial Times. April 2013. http://blogs.ft.com/beyond-brics/2013/04/04/corporate-watch-republica-del-cacao-on-the-origin-of-taste/?

“Stone Ground Chocolate.” Taza Chocolate, Inc. 2014. http://www.tazachocolate.com/Process/Stone_Ground_Chocolate

[1] Motamayor, J.C.; Risterucci, A.M.; Lopez, P.A.; Ortiz, C.F.; Moreno, A.; Lanaud, C.; (2002). “Cacao domestication I: the origin of the cacao cultivated by the Mayas”
Heredity Vol. 89, Number 5, pp. 380-386.

[2] http://www.chocolateroads.com/ecuador_cacao.html

[4] http://blogs.ft.com/beyond-brics/2013/04/04/corporate-watch-republica-del-cacao-on-the-origin-of-taste/?

[5] http://republicadelcacao.com/our-mission/

[6] http://www.tazachocolate.com/About/Direct_Trade_Infographic

[7] Draganusu et al, pp. 226.

[8] http://americanhistory.si.edu/collections/search/object/nmah_1301436

[9] http://www.tazachocolate.com/Process/Stone_Ground_Chocolate

[10] http://republicadelcacao.com/our-mission/

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