Sic Cacao, Chococam, Neo Industry, Ferrero …: after 4 seasons of improvement, the activity of Cameroonian cocoa processors drops by 4%

The cocoa industry in Cameroon, a vital component of the nation’s economy, has recently faced a perplexing downturn. After four consecutive seasons marked by progressive advancements, the activity levels of Cameroonian cocoa processors such as Sic Cacao, Chococam, Neo Industry, and Ferrero have unexpectedly declined by 4%. This development poses significant questions about the country’s sustainability and resilience of the cocoa processing sector.

Cameroon’s cocoa sector has long been a cornerstone of its agricultural output, contributing substantially to the livelihoods of farmers and the overall economic health of the nation. The recent dip in processing activities, however, highlights the vulnerability of this industry to various fluctuating factors. These include the vegetative rest period of cocoa plants, the impacts of climate change, and socio-political challenges within the region.

The decline is particularly noteworthy considering the recent entry of Neo Industry into the market. Despite adding this new processor, which boasts a substantial capacity, the overall tonnage processed has not met expectations. Sic Cacao, a subsidiary of the Swiss group Barry Callebaut, continues to dominate the processing activities, yet the numbers are not reflective of the increased capacities and investments made in recent years.

Moreover, the broader economic context cannot be ignored. The global cocoa market is subject to many international pressures, including price volatility and competition. The Cameroonian processors are also grappling with internal challenges such as the cost of agricultural inputs, which have surged due to international conflicts and regional instability affecting trade routes and supply chains.

Despite these challenges, the Cameroonian cocoa industry has potential pathways to recovery and growth. Diversification of products, investment in sustainable farming practices, and strengthening the value chain from production to processing can provide a buffer against market shocks and environmental pressures. Additionally, fostering a supportive policy environment and facilitating access to finance for smallholder farmers and processors can spur innovation and enhance competitiveness on the global stage.

The current situation serves as a critical juncture for stakeholders in the Cameroonian cocoa industry. It calls for a concerted effort to reassess strategies, invest in resilient practices, and explore new markets. With the right mix of policy support, industry collaboration, and innovation, there is hope that the sector can overcome the current slump and emerge stronger, ensuring the continued prosperity of Cameroonian cocoa processors and the communities they support.

During the 2023-2024 cocoa season, the number of cocoa beans processed in Cameroon stood at 85,789 tonnes, according to the report of the said campaign published by the National Cocoa and Coffee Office (ONCC). Of this volume, 85,671 tonnes were processed in industrial factories and 117,109 kg were recorded at the entrance of artisanal units. When observing the last campaigns, the 2023-2024 cocoa season shows the first decline in the volume of beans processed locally, particularly in the industrial processing segment. Although the document does not provide information on the reasons for this decline, it is important to note that 6 companies are active in the processing of cocoa beans into semi-finished or finished products.

In detail, industrial activity in the cocoa sector increased from 60,405 tonnes during the 2019-2020 campaign to 62,341 tonnes in 2020-2021 (+3.3%) before jumping to 86,850 tonnes the following season (+39.3%) thanks to the arrival of a new operator. Indeed, during the first 2 seasons, the sector consisted of 4 players: Sic Cacao, Chococam, Ferrero Group and Neo Industry before the launch, during the 2020-2021 campaign, of Atlantic Cocoa’s activities. The following campaign (2022-2023) recorded a slight increase in the volume processed in the factory to 89,204 tonnes, or 2.7% despite the entry into service of a 6th processor: Africa Processing Company (APC), located in Mbankomo.

Less than 50% of production processed

Despite the apparent good health of the sector, it should be noted that the transformation rate is well below the 50% mark of national production that the government and the players in the sector had set for 2020 as part of the recovery plan for the cocoa-coffee sectors, which also aimed to increase national cocoa production to 600,000 tonnes. Of the 266,725 tonnes marketed, only 85,789 were processed on-site, approximately 32%.

With an installed cocoa processing capacity of around 190,000 tonnes, the activity is driven by Sic Cacao, a local brand of the Swiss Barry Callebaut, which controls 70% of the market share with a capacity of 56,000 tonnes. Chococam, a subsidiary of the South African Tiger Brands, follows directly with factories with a total capacity of 50,000 tonnes installed in Cameroonian megacities (Yaoundé and Douala), then Atlantic Cocoa of the Ivorian Koné Dossongui, whose processing plant is installed in the industrial zone of the Port of Kribi with an annual capacity of 48,000 tonnes, expandable to 64,000 tonnes. Cameroonian Neo Industry closes the list of large processors with its factory installed in Kekem, in the West region, which has an installed capacity of 32,000 tonnes. For their part, Ferrero Group and APC process 1,000 tonnes and 100 kg of cocoa respectively.

It should be noted that Cameroon plans to build ten new processing units to increase the current processing capacity. To this end, two new factories have already been announced, including that of the Puratos group in Ebolowa, the capital of the South Cameroon region. This group operates in bakery, pastry and chocolate, with an annual processing capacity of more than 200,000 tons of cocoa beans. The Chocolat Rouge chocolate factory of the Frenchman Olivier Bourdais should also open a factory in Obala, Central region, during the year 2024.

Beyond chocolate, cocoa processing produces many by-products, such as cocoa powder, jam, cakes and cocoa butter, mainly intended for export. For the 2023 financial year, Cameroon exported 73,236 tonnes of cocoa-derived products, including 49,411 tonnes of cocoa paste and 23,825 tonnes of cocoa butter, generating total revenues of 153 billion CFA francs, according to data from the National Institute of Statistics (INS).