This episode of business wars is brought to you by the Simpsons on Disney plus the Simpson this is one of the longest running and most award winning series in history, and you can stream the first thirty seasons of the Simpsons and so much more right now, when you subscribe to Disney plus in the USA. Guanaria. I'm David Brown, and this is busy today. We conclude our series Hershey versus Mars in our last episode. Heard about how Mars is pushed into the international market turned a profit in China which into

drove the company to expand to other emerging markets across the globe and wild ambition certainly worked out for Mars on the business side, one major issue. That's now facing the company and the world, for that matter, carries some pretty dire consequences we're talking about deforestation, the environmental impact of producing chocolate, certainly on the scale of a company like Mars. It's actually astounding the Washington Post reports that twenty thousand and seventeen forty football fields of tropical forests were lost every single minute. All this, spurred by the demand for cocoa and other goods like so scenes in palm oil, and one trouble spot for chocolate. Producers in particular, is West Africa, where for a station is being driven by hundreds of thousands of poor cocoa farmers, for

Mars has vowed to switch entirely to sustainable cocoa by twenty twenty, but check that calendar they've now decided to move the target date to twenty twenty five, our guest today is Steven Mufson he's a reporter for the Washington Post and he covers the business of climate change. The recent He wrote a wide ranging article on the environmental impact of chocolate and he's going to be nice to talk about why producing environmentally sustainable chocolate is so hard. That's coming up. Next Support for business wars comes from capital, one with the spark cash car capital one. You earn unlimited two percent cash back on all of your business purchases. Think about it! Unless

two percent cash back on everything you buy for your business and that cash back can add up to thousands of dollars. You can reinvest back into your business, so you can keep growing imagine what unlimited two percent cash back could do for your business learn. More capital, one dot com. What's in your wallet,. Steven Mufson welcome to business wars. Glad to be here, for scale. When we talk about something like I mean deforestation, and for those of us who never, you know, seen like a cocoa tree. What is it Look like how bigotry are we talking about here? Well, the trees aren't very much larger than it than a person stands quite different from the older Is that I've been taking down to make room for cocoa plantations? Those older ones can be scores of feet. Tall

Let's do a translation here? One tree equals what, in terms of chocolate, what isn't so much the tree as the number of beans about four hundred beans. It takes to produce a pound of chocolate wow. That's That seems like quite a lot of beans. It's a lot of beings, especially when they're being taken out of these big pods by hand and see we have some great photographs of that with these kind of milky, milky white beans being taken out of the pots and put out to dry, Well, you're reporting, specifically centers around deforestation for cocoa, and I think it probably be safe to say that most of our listeners don't know where this is happening. Could you put us?

map somewhere about two thirds of the of the world's cocoa comes from just two countries in West Africa ones, the ivory coast and ones gonna, and they have a long history of producing cocoa there. And they are the dominant players in the market. Why, Ghana and the ivory coast? Why these two places? Is it just the climate? Is it just the existing tree growth? What why these to place. Well that's a great question. I think a lot of it dates back to the colonial era. When Coco was taken from there not so much the United States but more to Britain, to France and I do think there are other parts of the world that you can grow cocoa, especially places like Peru. Room It's possible that we may see more cocoa from those places overtime, but I think, there's a long tradition. Doing it in this area. Well, given that they are the

many players in the market, and I would imagine rather crucial for the incomes the livelihoods of a lot of people in those places is what? What what? Why is? Why is deforestation? The only answer? Couldn't you manage these cocoa trees in such a way? That, like say you could plan? one partial and end and harvest another and have a sort of a a cycle going well, this work makes this such a tough nut to crack. So to speak. You the commodity that is hard to differentiate from one place to another. All cocoa is basically the same, whether it's from ivory coast or or some place in South America and in the in West Africa, it's produced by hundreds of thousands of small farmers, bad, maybe one and a half million people in ivory coast, maybe another half million in gun

so keep an eye on what those people are doing. All the time is very, very difficult and that's what's deforestation in this area, so so tough to stop. Now in terms of the coca farmers themselves, how much do they tend to earn? I mean: is this a? Is this something that someone can a you know a family? Can? live off the land just growing cocoa. They can but they're not Is it going to make a whole lot of money most are at the? the blower slightly above the poverty line for for these kinds of areas, and of course, I some years, you're gonna get have a better harvest and and other years it's going to be tough, the usual vicissitudes of of of agriculture. I guess right absolutely, I mean the s of cocoa has been coming down in recent years and even though, companies have been paying premiums to get cocoa. That has been certified as not having come from the

as the money. The extra money from that isn't enough to offset the decline in cocoa prices in recent years. Help me was Why is it the trees need to be taken down for new cocoa trees? Do do these trees sort of cease to be productive after a certain number of cycles? Well, you're you're they plant the cocoa tree is either underneath some of the big trees but more likely they just cutting all the big trees down to make room for the cocoa trees that tends to Atwell well in the for the farmer, and at least in the early years, but in the later years it's can be a problem, because the heat is just too great. And I was speaking to someone today actually who was saying that at this rate, not only will there be decimation of the old forests, but that in twenty or thirty years will become increasingly difficult to grow,

echo in these areas, so is it because there just isn't the shade that's necessary for these cocoa trees because you're having to consume- Much of the land is possible to maximize output right and you want you want son in the early years, but you might want a little more shade in the out years. I see so it's not that new trees are better necessarily it's just that the land is being. Taken away for more cocoa trees the old trees, weren't cocoa trees, the old trees for these extremely tall old growth trees that play it a particularly important role in storing carbon dioxide. They are taking it in through photosynthesis. And then they're storing it in in their own in their own, in the wood that they that they that they have then, and that's what makes this important so when these old growth trees come down, what happens then

well when the old growth trees come down. You have kind of a two two blows: two blows at the at the climate problem. One is that the big trees, are no longer absorbing carbon dioxide from the air and processing it through photosynthesis. But in addition, the the carbon that had been stored in the trees is released as these trees, with their or rot or taken away to to be pulped terror to do something else with them. So They really cutting those trees down strikes to blows against the climate change problem. You've traced, sort of the flows of of the money here and- and you know you, let's see if we can- and maybe we should begin with, the small scale, farmers who, who plant and harvest what is the road from there to the candy or so the small scale farmers sell their product to middle.

The first layer, actually are several layers of middle. The first layer, known in french Ivory Coast, is a french speaking country peace to, and those in turn take it to larger trading companies eventually get to the big Cargill's of the world and they turn sell it to some of the big chocolate companies like Mars and Nestle and Hershey is oh in the same way that say, pork bellies or something like that might be. Yeah there's a standard. You know standard commodity, and there and their indistinguishable that's what makes them so easy to trade on big international markets corn or sugar gold, copper. All these are commodities that are traded internationally in cocoa is very much like but you're saying that recently, the prices for Coco have been falling, which obviously affects those farmers to

why is that? Why is it that cocoa prices seem to be falling? Well, I think there there are different things that can get that can drive prices up or down. It could be weather, but in this case when, when they prices dropping it's probably because the small farmers have been ramping up growth in order to stay out of poverty or to take advantage of the growing demand for coke. Across the globe. So what you're saying is that the supply side of the supply demand equation is is actually a cocoa glut? Is it worth and we have a mild cook, a glut? But yes, that's exactly what's happening because the and demand has been going up steadily. People love to have the candy is send their hot chocolate sin. Let's. Pursue that just a little bit more, because this is something that I find rather fascinating, that, yes, it is the sweet tooth is never gone away.

But increasingly certainly in the developed world, where many of these markets exist. For that finished product, the candy, the chocolate kind of a slow turn away from sweets. In fact, if anything, seems like certainly in Europe, in the United States and elsewhere, A sort of a shift toward more wholesome and healthful eating. If, if anything, why do you think that the demand is is increase? well, I'm not sure it's unique to cocoa? I think we've. We are witnessing a very interesting shift in in health food eating in the first was very much about you and your health, but now I think people are

considering some of the things that they eat, like beef and Coco. For climate reasons, it takes more carbon dioxide to produce beef than it does to produce vegetables and, in the case of Coco, the impact of the widespread deforestation is so great that that's also, I think, made some people wonder I don't think it's a big impact, but I think it has a lot of people thinking well now, while you were out reporting this story, was there anything that struck you most, perhaps about deforestation, in West Africa anything that sort of sticks in your mind. Well, the incredible thing about deforestation is that the pace of destruction is truly alarming. There are in two thousand and seventeen. There were forty football fields across the planet, not just in West Africa that were lossed every minute and ivory coast, and Ghana have losts not only

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More environmentally conscious like what they've invested in lot of renewable energy. They have purchased or built enough solar and wind power to offset the consumption of their operations and at least half a dozen different countries they they have advocated for a carbon tax and Congress, something that's very measured to get support for they've. Also, on to their total house gas emissions in a very telling way and unlike a lot of other companies out there it's counted not only themselves and their own factories and their immediate suppliers, but they've counted people, and companies all the way down the supply chain, all the way down

to the small farmers in West Africa, so they're they're, pretty pretty open about. That sort of thing question, of course, is what do you do with all that and I think, like a lot of companies, they set some targets a decade ago that they've been unable to Phil and during this whole time deforestation is continuing at a rapid pace. I think they're reconsidering various things now, but at the moment it looks like those ten years have been additional lost years. Notwithstanding us in these high goals, how does what Mars has done or tried to do. How does that fit in with what's happening industry, Why are there other companies that have taken similar steps or does Mars? of stand apart? Somehow, I think Mars doesn't stand up of that much You know maybe on the side of of

to do more and they and they speaking to the executives there. They I think they. Honestly assess just what a failure. Some of these efforts have been, but there are plenty of other companies in the in the same boat. There are some come out: Large number of them have drawn up plans for the for the future, which, of some combination of satellite information and more people on the ground. But Are some companies that haven't even done that so I would say: Morris is typical, or or maybe even on the good side of typical you also have reported that Mars still has a huge carbon footprint because of agriculture Is there any way to sort of quantifying or or maybe make it pop? first to visualize how that, how big that print is and and how closely that might be tied to the deforestation we've been talking about? Well,

the total emissions of Mars is about equal to the country of Panama, so pretty, which seems large to me that a letter, a single company, would have this many admissions as a as a as a single country, but I suppose to be for as we're talking before Mars. Isn't the only chocolate company that contributes to this and I'm wondering if. If Mars, is, has the footprint of a country the size of Panama. What about the chocolate, St. What a up! What is the whole yeah exactly exactly so that's a great question: what what what? How would is there any way of of of getting your head around that, or is that just too big of a of an issue? Well, I haven't thought about this, but I

believe that Mars is it's a private company. So it's hard to say just how big it is, but I think I think it's somewhere between a quarter and a half of the whole chocolate business and- and so it probably means that the whole chocolate business might be worth two three four Panama's, I understand what you're saying and in terms specifically when it comes to to combating deforestation, for all of the issues that Mars his is had in trying to meet its objectives. What about the the specific question of deforestation, his his Mars been able to accomplish much there specifically? No, not yet, and I think it you know another one way of thinking about this David. I think it is that the is the problem of deforestation is contributing about ten the equivalent to about ten percent.

Global greenhouse gases? So that's an important element. On the one hand, unlike a lot of other producers of greenhouse gases, the agricultural sector knows what methods it could use to to slow down or even stop the process of deforestation. The problem is getting people to actually implement them, and especially when you're talking about you know, two million small cocoa farmers and you've got the same problem in Indonesia with Palm oil and we're all pretty aware of the problems in the Amazon to with soy, this is a global problem and it's tantalizing, because the solutions don't seem that complicated, but actually making it happen is very difficult.

But of course, this is why there exists some treaties that deal with questions like deforestation. You would that the government of some of these west african countries, we would be in their interest to do what they can, because specifically, as you've reported a lot of, deforestation takes place on public land and even if it weren't taking place on public land. It seems to me that there are things that that governments can do to try to combat this problem. Just from the standpoint of you know,

of regulation? Well, that's true, but you know ask it's a tough place to do. Business are actually covered. After for the Wall Street Journal back in the eighties I've been to about a dozen countries, there there's a lot of corruption. There is other things that lot of regulation that make it very difficult to to get things done. There's a consulting firm. That's warned investors that the ivory coast is very corrupt. It's got a corruption index worldwide corruption index and it's placed ivory coast. You know in a in a bad spot on that, list so that, in addition, in defense of those of those governments, even the best efforts are are hard to to deal with. They have tremendous, migrants coming down into the ivory coast, from Burkina Faso in and and these people are eager to have food

and a lot of them set up in the national forests and start cutting trees and and and selling cocoa it's about eking out an existence and in many cases I suppose absolutely. Quote someone in my story is saying you know this he's thinking about climate change is thinking about about making a living. How is it. I mean here we are in the developed world, lecturing others that you know W west african governments that you should do more or telling a farmer look. What you're doing is is harming the environment at large and and yet Well, it is not a necessity. I think you're right, I mean there's nothing, there's nothing fair about climate change, I'm afraid the people who are best able to adapt. Are the people

money, the people who are suffering the most are the people who have the fewest resources, seven and eight a big reason why we've seen so much migration around the world, no matter, no matter where you're talking about Bangladesh, West Coast of Africa, people flocking into Europe, climate has has not isn't the only thing to blame, but it is a fact. It's a factor. That's probably going to grow. Okay! Well, then, let's blue sky, this for a moment is it possible to have a sustainable chocolate pipeline. I mean is anyone out there? Have you noticed any company out there? That's trying to to do this beyond what Mars. Is it, as has announced that it wants to do? Well, I think Mars and a lot of other companies are looking at at some. Possible solutions and they would include better

of satellite data because we haven't really they haven't really. Slide satellite data in in in a big way in these areas. So and then you need a lot more people on the ground. I mean I don't. I don't think that Mars really has too many people on the ground and in order to monitor this you're going to have to do that. So you need to see where people are where the farm sorry have to notice in a timely fashion, when they're when they're contours are changing, you have to cut off payments to them. At that time, It's it's a lot and it's going it's going to take and it's going to cut into margins and profits, and that's that's going to be difficult, but there really isn't any other way to this phenomenon, because you really need to have that kind of very granular information and you needed on a very broad scale, so that you can do something

are, you need to have the kind of data that you could see from, miles above, planet earth right and even that is difficult, because a lot of the cutting takes place beneath the tree canopy so so that even the satellite data might not pick up the first signs that people are settling in to these forested areas. You've written about a company called very Calabro. What is it that that Berry Calabro has done so they they're sort of working on this very thing and they've also cataloging who's living on these places, and they have a lot of information about family sizes. They have three hundred people on the ground, monitoring things So it's a big effort, although again it's it's a fraction of the whole industry, but it is, does seem like a step in the right direction,

I mentioned a few minutes ago that that you know chocolate is a luxury and I was thinking if I were in your shoes, Stephen. It might be hard to candy the same way as I might have before. I went into this kind of of reporting do you has this changed the way that you think about candy and chocolate in particular I do think about it, although I must say I like certain kinds of chocolate products, but I have spoken to several people here. Several people stopped eating. Chocolate stopped at least stopped eating it. For now, I think it's also important to remember that we do a lot of things that that are bad for the the earth's climate? How to do to work today? Well, I I took a car course all right. Well, there you go, I mean

you know each of us in his own way and his or her own way is, is doing something- and I think part of the point of of the articles that we are doing here is to try to get people to reassess that and to think of things that they can do different. There policies that policies that we could that we can adopt. That might point us in a different. So, do you still indulge? Do you have a favorite chocolate, do actually have a lot. I my wife makes a mean and kids make mean chocolate cake and I love chocolate chip cookies, although I have been cutting back on those, but I had already been cutting back on them, for resistance for regular health. I totally understand- and I and I'm with you there, a hundred percent, but you know a it- is seriously after reporting on this industry. What are your sort of reflections on how this

streets come about and what it takes to produce. Chocolate on a mass scale I mean is this: is this something that well in and I'll just leave the question open there will! What? What do you? What do you make of of the chocolate industry now that you've been reporting on? Well, it's like a lot of commodity industries. You know it's got a lot of far flung hours are suppliers, that's got big middlemen, Cargill's big, not only come in my car bills, not only big in cocoa butter and sugar and wheat, and I think that they play a very big roles in certain countries that become very dependent on those commodities, and I think that's true from place to place around the world. It just

It might not be cocoa, but it might be something else, and developments in a lot of those places is very challenging and there's a lot of poverty. So hey! You know. I saw a lot of that when I was covering Africa and it's not just african, it's it's all sorts of other places, Steven my is a reporter for the Washington Post and he covers the business of climate change. We're going to have a link to his story. The trouble with chocolate in our show notes Steven it's been great to get a chance to talk with you about your reporting. Remarkable piece of journalism. Thank you so much for taking time to speak with us on business works. Thank you from wondering. This is business wars. We sure hope you enjoyed episode coming up on our next series. Well you either love him or you hate him- that these little morsels somehow always end up in the things we eat. Raisins were talking

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