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Wageningen Economic Research | White paper on sustainable commodity production
1
A living income for smallholder
commodity farmers and protected
forests and biodiversity: how can the
private and public sectors contribute?
PLEASE CLICK ON THE SECTION OF YOUR CHOICE.
1 Interventions to lift smallholder commodity
farmers out of poverty have failed and have not
halted deforestation – what now?
2 There is no business case for lifting the poorest
farmers out of poverty
3 Contextual and personal factors to be addressed in
policies and interventions to be able to inuence
farmers’ behaviour, increase farmer incomes and
protect forests and biodiversity
4 To protect forests and biodiversity, all drivers of
deforestation should be addressed simultaneously
5 Structural change is essential for all smallholder
commodity farmers to earn a living income
6 What public and private sectors can do:
conclusions and recommendations for lifting
smallholder commodity farmers out of poverty and
protecting forests and biodiversity
7 Research agenda to support structural
transformation: a need for transformational
science to facilitate smallholder farmer sustainable
development
Yuca Waarts, Valerie Jansen, Verina Ingram, Maja Slingerland, Fédes van Rijn, Gonne Beekman,
Just Dengerink, Jiska van Vliet, Eric Arets, Marieke Sassen, Joost Guijt, Simone van Vugt.
November 2019.
Wageningen Economic Research | White paper on sustainable commodity production 2
Interventions and policies in the cocoa, tea and coffee sectors have failed to ensure
that all smallholder commodity farmers earn more than the $1.90 World Bank
poverty line or a living income, and they have not halted deforestation. Commodity
farming is strongly associated with deforestation, in spite of interventions. For
more than 50% of the cocoa and tea farmers in our datasets, household income
would need to double in order for them to earn a living income. For those farmers,
farming will never be a primary pathway out of poverty.
In this paper, we explore data and the literature to
propose approaches towards creating signicant impacts
on the income earned by commodity farmers and their
household members, and towards protecting both forests
and biodiversity. Our key messages are as follows:
• A minority of smallholder commodity farmers earn
or could earn a living income from primary com-
modity production. For many farmers primary agricul-
tural production of global commodities will never be a
pathway out of poverty because of small farm sizes and
low productivity levels.
• Price increases at scale can play an important role,
but require supply management to offer stable long-
term income impact without negative impact on forests
and biodiversity.
• A tailored approach is needed. Smallholder commod-
ity farmers who cannot earn more than the living
income need alternatives, such as employment
opportunities, so that they can move out of agriculture
when land reform is implemented.
• Farmers remaining in agriculture should have the
opportunity to increase farm sizes through appropriately
implemented land reform.
• Such farmers should obtain support in land use
change if they are situated in areas affected strongly by
climate change. Such support should take into account
the entire farm, not the commodity eld only.
• In identifying the farmers who will or will not be lifted
out of poverty by agriculture-based interventions, swift
and effective decisions can be made on where and
how to invest time and funds. In this way, policies
and programmes can be implemented more cost-effec-
tively, farmer’s frustrations can be avoided, as well as
any time and costs associated with non-adoption.
• Policies and interventions must take into account
contextual and personal factors which can inuence
farmers’ behaviour. People in rural areas should be
listened to about their aspirations, needs and opportuni-
ties.
• Forest and biodiversity protection works best with
multiple simultaneous interventions tackling all drivers
of deforestation, including a strong role of the local
population, sharing of information (data) and ultimately
a concerted action between public and private stake-
holders from different sectors, in order to prevent any
shifting of the problem to some other sector or place.
• For designing effective and efcient interventions,
ndings should be shared between countries and across
commodities on what works and also what failed to
work. This includes the sharing of data and methodolo-
gies in order to avoid too much data being collected too
many times, with too many farmers being interviewed
too often, to satisfy the needs of various buyers and
implementers.
Wageningen Economic Research | White paper on sustainable commodity production 3
1 Interventions to lift smallholder commodity farmers out
of poverty have failed and have not halted deforestation
– what now?
1 See Appendix 1 for how the poverty line and living income line were calculated.
2 WUR was granted permission to use the condential data from two cocoa studies for this paper. See Appendix 1 for more information including a disclaimer.
Interventions in cocoa, tea, coffee and oil palm
sectors generally have resulted neither in lifting
smallholder farmers out of poverty nor in forest and
biodiversity protection.
Smallholder farmers in commodityi value chains such as
cocoa, tea, coffee and oil palm have received numerous
interventions from private sectors for food and agribusi-
ness traders, processors and manufacturers, as well as
public sector agencies in the past two decades aiming to
improve their incomes and lift them out of poverty.
Interventions have ranged from training, to voluntary
sustainability certication and the provision of free or
subsidised inputs, to the support of farmer groups, to
community-level provision of infrastructure, such as
school buildings, medical centres and access to potable
water. However, most interventions have had limited,
mixed or no impact on household incomesii. Despite those
interventions, in the majority of commodity farm house-
holds, incomes per capita are below living income stand-
ards1. In Figure 1, we show examples from our research
that support this nding for important cocoa and tea
producing countries2.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Cocoa Ghana Cocoa Ivory
Coast
Tea Kenya
Above living income
Between WB poverty line
and living income
Below WB poverty line
Figure 1 Percentage of smallholder commodity farmers above and below the $1.90 World Bank poverty line and living income standards
Source: Ghana: Waarts et al., 2014 (N = 311), Côte d’Ivoire: Ingram et al., 2018 (N = 362), Kenya: Waarts et al., 2015 (N = 439).
It is a huge challenge to lift farmers
out of poverty
Wageningen Economic Research | White paper on sustainable commodity production 4
For more than 50% of the cocoa and tea farmers in
our datasets, household income would need to
double in order for them to earn a living income.
It is a huge challenge to lift farmers out of poverty: about
half of the cocoa and tea farmers we interviewed would
need to double their income in order to earn more than
3 For comparison, the monthly living income line per family was converted to a daily living income per household member.
the living income line (Figure 2)iii, a benchmark income
level which is more and more often set as a goal by both
the public and private sectorsiv. These challenges lead to
the question of whether and how such farmers can be
supported to earn a living income. This is the rst ques-
tion that will be addressed in this paper.
Income per capita per day (USD PPP)
0
0,5
1
1,5
2
2,5
3
3,5
4
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Above
living
income
Above
living
income
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Above
living
income
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Cocoa Ghana Cocoa Ivory Coast Tea Kenya
Mean Median WB poverty line Living income line
Figure 2 Income earned per household member per day (USD Purchasing Power Parity)3
Source: Ghana: Waarts et al., 2014 (N = 311), Côte d’Ivoire: Ingram et al., 2018 (N = 362), Kenya: Waarts et al., 2015 (N = 439).
Commodity farming is strongly associated with
deforestation and biodiversity loss, despite
interventions.
A large body of research shows that commodity farms
have often been created in forested areas or previously
forested areasv. These agro-ecological areas are suitable
for growing commodity tree crops, as their wild ancestors
originated from forests. Population increases and the
fertility of forest soils have led farmers to convert forested
areas to farms in order to sustain their families and to
satisfy the increasing demand for commodities. This
expansion, combined with a general lack of investment in
already cultivated elds, is strongly associated with land
degradation, biodiversity loss and deforestationvi.
Reforestation or compensation measures have had limited
success in halting or mitigating these impactsvii.
Based on the literature and the data from our cocoa
and tea research, we propose approaches for signi-
cantly impacting household incomes, as well as the
protection of forests and biodiversity.
In this paper, we present information on smallholder cocoa
farmers in Ghana and Côte d’Ivoire, as well as smallholder
tea farmers in Kenya, in order to assess whether and how
such farmers can be better supported (Section 2).
Through a literature review that focuses on overview
studies and systematic reviews, we investigate why past
interventions have not had the expected effects, an
investigation that reveals contextual and personal factors
which inuence farmer behaviour (Section 3); we also
draw conclusions about how best to address drivers for
deforestation (Section 4). Finally, we present and reect
on strategies for impacting smallholder commodity farmer
incomes (Section 5), and we conclude with recommenda-
tions for the public and private sector (governments and
businesses) and NGOs on both increasing farmer incomes
and protecting forests and biodiversity (Section 6). Finally,
we present a research agenda for transformational science
to facilitate smallholder farmer sustainable development
(Section 7).
Wageningen Economic Research | White paper on sustainable commodity production 5
2 There is no business case for lifting the poorest farmers
out of poverty
4 See for more information on how the living income is calculated in Appendix 1.
5 In these calculations, it is assumed that the $400/tonne living income differential would end up totally in the farm gate price.
Even when farmers’ incomes increase,
many remain poor.
Interventions aimed at income enhancement and lifting
farmers out of poverty are often based on the assumption
that the latter should be attainable through said interven-
tions. However, for many farmers this is an unachievable
goal due to the conditions in which they live. Even if
farmers’ incomes from cash crops were to directly
increase – for example, through increased farm gate
prices – we observe that small farm sizes and low produc-
tivity levels lead to only a few farmers moving to another
income group. Figure 3 shows that even if farm gate
prices for tea were to increase by 50%, only 6% of
farmers would shift into the group of farmers earning
more than the living income line (see Figure 1 for baseline
gures)4. Such price increases, moreover, are not expect-
ed, and if increases were not properly managed, they
could lead to unwanted market effects, such as large
increases in volumes produced, putting pressure back on
price levels.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Cocoa Ghana Cocoa Ivory
Coast
Tea Kenya Cocoa Ghana Cocoa Ivory
Coast
Tea Kenya
25% increase in commodity income 50% increase in commodity income
Below WB poverty line Between WB poverty line and living income Above living income
Figure 3: The effects of a 25 and 50% increase in income from cocoa (Ghana and Ivory Coast) and tea (Kenya) in obtaining a living income
Source: Ghana: Waarts et al., 2014 (N = 311), Côte d’Ivoire: Ingram et al., 2018 (N = 362), Kenya: Waarts et al., 2015 (N = 439).
A recent political deal between the governments of Côte
d’Ivoire and Ghana requires chocolate companies to pay a
living income differential of $0.40 per kilogram ($400/
tonne) on all 2020/2021 season cocoa contractsviii, on top
of the market price. The ICCO daily price was $2408/
tonne on 7 November 2019ix. At such a price, the price
increase would constitute 17%. Any increase in smallhold-
er farmers’ incomes is a step in the right direction since
they are often poor, but even under the assumption that
the full premium ends up with the farmers, it would not
help most out of poverty. An increase per kilogram will
yield the largest benets for farmers in higher income
groups, as they produce larger volumes. Based upon our
data, a $0.40 increase per kilogram would yield approxi-
mately a $205 increase in yearly income for farmers
earning less than the poverty line in Ghana and a $360
increase in Côte d’Ivoire. In addition, such an increase
would positively affect the yearly income of farmers
earning more than the living income standard in Ghana by
$832, and in Côte d’Ivoire by $17075. For our analyses on
the usefulness of this living income differential, see
Section 5.
The fact that smallholder farmer household incomes
have often not increased is the result of relatively
intractable farmer characteristics, such as farm size,
in combination with low productivity levels.
Cocoa and tea farm sizes are generally small, and with the
exception of Ghana, they are much smaller among
smallholder farmers earning less than the living income
than they are among farmers earning more than the living
income (Figure 4). We nd that the farm sizes for farmers
We observe that only few farmers move to
another income group
Wageningen Economic Research | White paper on sustainable commodity production 6
in the tea sector in Kenya are particularly small, while
inheritance and a growing population drive down the
mean farm size even furtherx. Farm sizes for cocoa are
larger, but the returns of these larger plots in terms of
income earned are often similar to the returns of tea
farmers farming smaller plots of land. Even if there is a
possibility to increase a commodity’s productivity or to
produce a more protable crop on (part of) the land,
these can only lead to marginal increases in income, as
total volumes produced will remain small. Thus, the
income earning potential of small plots is limited. We nd
that the low incomes of the poorest farmers are explained
by low productivity levels in combination with small farm
sizes.
0
1
2
3
4
5
6
7
8
9
10
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
Hectare - cocoa
Hectare - tea
Mean Median
Below
WB
poverty
line
Between
WB
poverty
line and
Living
Income
Above
Living
Income
Above
Living
Income
Below
WB
poverty
line
Between
WB
poverty
line and
Living
Income
Above
Living
Income
Below
WB
poverty
line
Between
WB
poverty
line and
Living
Income
Cocoa Ghana Cocoa Ivory Coast Tea Kenya
Figure 4: Cocoa and tea farm size in hectares by income group
Source: Ghana: Waarts et al., 2014 (N = 311), Côte d’Ivoire: Ingram et al., 2018 (N = 362), Kenya: Waarts et al., 2015 (N = 439).
Low average productivity levels prevail, not having
signicantly improved in decades, despite
interventions.
Productivity levels for smallholder farmers are generally
far below maximum achievable levels (Figure 5). Only
very few farmers achieve high levels of productivity. On
the one hand, this indicates the potential to increase
farmer productivity. On the other hand, the literature and
data show that average productivity per hectare has not
signifcantly improved in decades, despite interventionsxi.
Our evaluations show that it is difcult to signicantly
increase farmer productivity since various factors inu-
ence farmers’ investments. Interventions in cocoa in
Ghana and Côte d’Ivoire outcomes were mixed and
generally modestxii. In Kenya, we found that tea farmer
participation in farmer eld schools did affect productivity,
but adoption levels remain low and generally productivity
levels remain far below the maximum achievable levelxiii.
In all three countries, farmers in the lowest income group
have the lowest levels of productivity.
Wageningen Economic Research | White paper on sustainable commodity production 7
0
250
500
750
1,000
1,250
1,500
1,750
2,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Productivity per hectare - cocoa
Productivity per hectare - tea
Mean Median Maximum
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Above
living
income
Above
living
income
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Above
living
income
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Cocoa Ghana Cocoa Ivory Coast Tea Kenya
Figure 5: Productivity: kilogram per hectare per sector by income group
Source: Ghana: Waarts et al., 2014 (N = 311), Côte d’Ivoire: Ingram et al., 2018 (N = 362), Kenya: Waarts et al., 2015 (N = 439). The
maximum productivity was established in these studies based on feedback from agronomists in the areas we studied.
Farmers have more land than just for cocoa and tea.
Farmers do have other land available besides tea or cocoa,
indicating that one must consider the entire farming
system instead of the cocoa and tea elds only if one is to
accurately assess how to best support the farmers.
However, such additional land parcels are not often
sufcient for generating substantial income (Figure 6).
Small farm sizes, combined with challenges in acquiring
and enlarging farm size, as well as encroachment upon
forested land, are barriers for farmers to earn more.
Farmers are quite dependent on commodity in-
comes, leaving little room for income diversication.
Income diversication can be an important way to im-
prove farmer resilience. In our cocoa studies, a large
proportion of farmer income is earned y producing the
commodity (about 80% in Ghana, 90% in Côte d’Ivoire
and 70% in Kenya, Figure 6). In particular in our study,
cocoa farmers in Côte d’Ivoire have very few alternatives
other than cocoa production to generate income, leaving
them vulnerable to climatic and price uctuations.
Wageningen Economic Research | White paper on sustainable commodity production 8
Another study indicates that cocoa farmers in Côte
d’Ivoire are dependent on cocoa for 66% of their income
and farmers in Ghana 61%.xiv . Many farmers are thus
very dependent on cocoa production for earning their
income. The lack of options for diversication may have
different causes: the household may not have excess
labour or land available to invest in on- farm or off-farm
income generation, or other income opportunities may
simply not be available.
0
2,000
4,000
6,000
8,000
10,000
12,000
USD/year
Mean commodity income Mean other on-farm income Mean off-farm income
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Above
living
income
Above
living
income
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Above
living
income
Below
WB
poverty
line
Between
WB
poverty
line and
living
income
Cocoa Ghana Cocoa Ivory Coast Tea Kenya
Figure 6: Yearly household income in USD by income group
Source: Ghana: Waarts et al., 2014 (N = 311), Côte d’Ivoire: Ingram et al., 2018 (N = 362), Kenya: Waarts et al., 2015 (N = 439).
There is no business case for lifting the poorest
farmers out of poverty.
Productivity levels, combined with small farm sizes of
smallholder farmers earning less than the World Bank
poverty line, suggest that there is no business case of
increasing income levels such that all farmers earn more
than the living income lines. Not only are farmers in the
lowest income group the most vulnerable to shocks, they
also have very limited opportunities to increase productiv-
ity and diversify. Moreover, even if opportunities were
more available, such famers still likely would not be lifted
out of poverty, especially in Côte d’Ivoire and Kenya,
where the lowest-income farmers have signicantly
smaller farms than those in other income groups.
Improving farmers’ productivity has not been and will
not be enough to lift them out of poverty.
Improving farmers’ productivity has
not been and will not be enough to lift
them out of poverty
Wageningen Economic Research | White paper on sustainable commodity production 9
3 Contextual and personal factors to be addressed in policies
and interventions to be able to inuence farmers’ behaviour,
increase farmer incomes and protect forests and biodiversity
Contextual and personal factors impede farmers from
changing farm management practices that could increase
household incomes and protect forests and biodiversity.
Our research, conrmed by the literature shows that, even
if farmers adopt new farm management practices, many
farmers do not adopt the recommended practicesxv.
Furthermore, if farmers do adopt new practices, they
rarely adopt all recommended practicesxvi.
Required investments present nancial risks for
farmers, while farmers often lack the means to
invest.
Studies have shown that farmers are often resistant to
change, or dis-adopt after initially adopting new technolo-
giesxvii. This is due to different reasons which can be
roughly divided into four categories, see next page.
H
o
u
s
e
h
o
l
d
F
a
r
m
l
a
n
d
C
o
m
m
u
n
i
t
y
C
o
u
n
t
r
y
Personal factors
such as trust & risk
Education
Environment
Labour market
Infrastructure &
distance to market
Transaction
costs
Institutions &
governance
Market structure &
price
Input
services
Financial
services
Extension
services
Figure 7: Contextual and personal factors inuencing smallholder commodity farmer behaviour
Wageningen Economic Research | White paper on sustainable commodity production 10
1 Inability to afford investment
Smallholder farmers may resist technological innovations,
given that required investments often present nancial
risks and even losses in the short term, while smallholder
farmers often lack a credit basis for nancial invest-
mentxviii. Farmers often cannot afford recommended inputs
(including hired labour) or spend their often scarcely
available cash on other living expenses, such as school
fees or food. In addition to nancial investments, im-
proved farming practices usually require substantive
additional household labour requirements which make
them unattractivexix.
2 Investment benets not guaranteed
Future benets are not guaranteed. Farmers may decide
not to adopt new practices because those practices might
not lead to signicant income increase, for instance when
farming small parcels of land, or when inferior planting
material will not respond to improved practicesxx. Adoption
of technology only leads to increased agricultural produc-
tivity under specic circumstances and conditions which
cannot be broadly recreatedxxi. Farmers base their motiva-
tion and effort level on their expectations of the new
practice or technology, and if they experience that the
extra effort does not meet their expectations, they will
decrease their effort levels in the next season.xxii
3 Failing markets prompt constraints
Failing markets often lead to adoption constraints. Inputs
such as fertiliser, crop protection products and hired
labour are often not available – or they are available but
not at the right time. In addition, quality of inputs cannot
be assessed by farmers. The asymmetry of information
6 ‘Transhumance is the regular movement of herds between xed points to exploit seasonal availability of Pastures’ (FAO, 2001)
about quality of inputs increases the risks for farmers to
invest in seeds or fertiliser of insufcient qualityxxiii.
4 Interventions are often not tailored to aspirations,
needs and opportunities
Finally, interventions often are not tailored to farmers’
aspirations, needs and opportunities—moreover, they are
implemented from a technocratic perspective. They hardly
consider personal factors that determine the motivation to
adopt new farming practices. For example, new practices
may conict with social norms. In Burkina Faso, for
instance, crop livestock integration is a technology that
has clear benets and improves status for crop farmers
because livestock is a sign of wealth. However, crop
livestock integration is seen as a failure by transhumant6
livestock herders, as it forces them to work the land,
which is considered a last resort for those who cannot live
anymore off of their herds (Slingerland, 2000). Social
networks and norms can have a strong impact on technol-
ogy adoption decisionsxxiv.
Hence, understanding both the contextual and personal
drivers of technology adoption behaviour is of utmost
importance in designing effective interventions for small-
holder farmers in order to support them to adopt good
farming practices, while also aiming towards earning a
living income and preserving biodiversity.
P
e
r
s
o
n
a
l
f
a
c
t
o
r
s
influencing
farmer & household
decision making
Psychology of
poverty
Aspiration
bias
Cultural
environment
Socio-
demographic
characteristics
Ownership
Peer effect
Figure 8: Detailed personal factors inuencing smallholder commodity
farmer behaviour
Wageningen Economic Research | White paper on sustainable commodity production 11
4 To protect forests and biodiversity, all drivers of deforestation
should be addressed simultaneously
7 The Consumer Goods Forum (CGF) pledge to zero net deforestation 2010, New York Declaration on Forests 2014, Amsterdam Declaration towards Eliminating
deforestation from agricultural commodity chains with European countries 2015, Cocoa and Forests Initiative 2017, European Commission 2019 Communication to
step up action against deforestation and to restore forests (EU 2019).
Smallholder commodity production is connected to
deforestation, but increasingly, large-scale indus-
trial agriculture for domestic urban consumption
and exports are drivers of deforestation.
Globally, 27% of all forest disturbances result from
commodity-driven deforestationxxv. However, the common
view that growing populations of shifting cultivators and
smallholders are the main drivers of deforestation has
been false, as large-scale industrial agriculture for domes-
tic urban consumption and agricultural exports is increas-
ingly the primary driver of tropical deforestationxxvi. In
Côte d’Ivoire, our studies showed that between 40 and
58% of cocoa farms had been cleared from primary forest,
and 25 to 33% established on fallow land, with farms on
average 21 years oldxxvii.
Deforestation, environmental and land degradation
attributed to smallholder farmers is driven by many
factors.
Deforestation worldwide is an important cause of green-
house gas emissions contributing to climate change, and it
can create a local loss of ecosystem services and natural
capital. However, smallholders convert forests to agricul-
tural land (to expand farmland or compensate for decreas-
ing productivity on existing farms) and degrade forests
through unsustainable exploitation, such as for timber,
fuel, foods and medicines for subsistence use and in-
comes. These local benets can be weighed against the
costs of access and social and institutional barriers that
determine people’s use of and impact on a resourcexxviii.
These impacts change over time, as well. There has been
a tendency to identify ‘universal’ drivers of deforestation
(or what may stop it). Population, wealth (or conversely
poverty) and market access are considered major drivers
of forest lossxxix.
There are many new commitments to stop deforest-
ation – but these are often blind to multiple drivers,
failing to address them or addressing outcomes
instead of causes.
By 2018, over 450 commodity traders and retailers had
committed to voluntary sustainability certication, made
individual corporate commitments and programmes and
signed pledges and regional and international public sector
agreements7 to reduce or eliminate the deforestation
caused by their commodity value chainsxxx. However, many
of these commitments fail to consider that the dynamics
of forest loss and recovery are driven by many political
and socio-economic contexts and forces, interacting at
global to local levels and over timexxxi. These interactions
mean that interventions to mitigate deforestation by
smallholder farmers can play out very differently, depend-
ing on local (historical) contexts. Even actively policed
boundaries are easily encroached when other factors allow
or encourage it, when access to managed forests is
misusedxxxii or when land ownership claims overlapxxxiii.
Similarly, payments for ecosystem services can be cap-
tured by elitesxxxiv, leaving poor smallholders even more
dependent on forest resources. The evidence base on the
most effective measures to stop deforestation is still weak
and scattered. What works or not is very much context
dependent.
Improved farm productivity in elds close to forest
areas does not necessarily reduce pressure on
forests.
Many studies indicate that in addition to local yield
increases, measures to prevent agricultural encroachment
into forests are essentialxxxv. Productivity improvement can
encourage deforestation when commodities have elastic
demand on the short term (i.e. when supply increases,
their prices do not decrease)xxxvi, situations that are
common in cocoa, palm oil, soy and timber, but also in
local charcoal and wood fuel value chains. Additionally,
creating economic opportunities through improved
productivity can attract migrants, which further contrib-
utes to forest encroachmentxxxvii. When farmers are
capital- and/or labour-constrained, productivity intensi-
cation can release labour and allow farmers to expand
cultivated farm areas.
Protected areas – when well-managed – can reduce
deforestation, but often do not stop forest
conversion.
While well-managed protected areas can reduce defor-
estationxxxviii, protected multiple-use areas appear more
successful in reducing forest loss. These approaches focus
on improving yields and sustainability of smallholder
production in combination with inclusive landscape
The evidence base on the most eective
measures to stop deforestation is
still weak and scattered
Wageningen Economic Research | White paper on sustainable commodity production 12
approaches protecting forests, while also taking into
account the local context and needs for regulated forest
access and use. Such approaches are likely the most
successful for stopping or reducing forest degradation and
deforestationxxxix.
Various interventions tested for restoration, but the
role of smallholders in restoration is unclear.
While there are cases of forest restoration, efforts to
implement restoration promises generally have been slow
to gain traction, with most restoration taking place outside
of natural forests, and the role of smallholders in restora-
tion is unclearxl. Collaborative interventions include
encouraging diverse agroforestry systems, sustainable
agricultural intensication, promoting the use of degraded
lands, cash-for-work programmes, incentivised grants and
loans to smallholders while adjusting or removing per-
verse incentives from subsidies and, lastly, establishing
national forest restoration fundsxli.
The most effective means of addressing the causes
of deforestation appears to be multiple simultane-
ous interventions.
Evidence concerning the most effective solutions to stop
commodity-driven deforestation suggests the importance
of several initiatives implemented simultaneously: strong
enforcement of forest protection laws; support of contin-
ued forest management by local people, including legal
rights; payments for ecosystem services (PES) that
increase the economic value of forests to local people,
while reinforcing their intrinsic motivation to protect the
forest; and timely national action, rather than lengthy
international agreementsxlii. Stopping PES runs the risk of
resuming deforestation behaviour—or worse. Without
monetary value, the forest may suddenly become worth-
less, whereas before PES was established, forests’ multi-
ple intrinsic, social and economic values became ‘forgot-
ten’ or ‘overruled’ by PES monetary value. Kerr et al
8 Leakage: the ‘net increase of greenhouse-gas emissions in an area outside the project resulting from the [project] activity’ (Schwarze et al., 2002). It occurs
‘whenever the spatial scale of intervention is inferior to the full scale of the targeted problem’ (Wunder, 2008). This denition also applies to deforestation itself next
to for greenhouse-gas emissions resulting from deforestation.
(2017) clearly shows that incentives that undermine
intrinsic sources of motivation are able to crowd-out
targeted behaviour, while incentives that reinforce intrinsic
sources of motivation can crowd it in.
Multi-stakeholder collaboration is needed taking
into account leakage and spill-over effects of
interventions.
The implementation of multiple and simultaneous inter-
ventions requires multi-stakeholder collaboration. As
many of the compliance mechanisms associated with
implementing zero deforestation initiatives are costly,
these may be overwhelming or inaccessible for smallhold-
er farmersxliii. This should be addressed. Land use policy
change furthermore needs to take account of leakage8 and
spill-over effects of interventions. For example, policies to
reduce soy-related deforestation in the Brazilian Amazon
appeared successful, but deforestation increased in the
Cerradoxliv. Additionally, high compliance costs in regions
where zero deforestation commitments are implemented
could result in a loss of competitive advantage, encourag-
ing further leakage to other localitiesxlv.
Such collaborations should include appropriate
baselines, monitoring and evaluations.
Appropriate baselines are needed in order to compare the
results of interventions in landscapes where different
communities, ethnic groups or land uses occur. Especially
for landscapes with different commodities and where
organisations implement different programmes, the
overall effect on deforestation may be assessed, but the
effects of specic interventions are difcult to untangle.
Reporting on the progress of zero deforestation initiatives
is scarcexlvi, and on-the-ground impacts that can be
attributed to these initiatives are limited at best. The New
York Forest Declaration ve-year assessment reported few
positive results and slow progressxlvii. As baselines and
monitoring activities often go beyond what are perceived
as private sector activities and spheres of inuence,
partnerships with public sector, civil society, research
organisations and service-providing organisations—such
as the World Resources Institute’s Global Forest Watch
and the Sustainability Consortium (TSC) (Curtis et al
2018)—are essential in enabling the tracking of impact of
zero deforestation initiatives, if implemented properlyxlviii.
Policies to reduce soy-related deforestation
in the Brazilian Amazon appeared
successful, but deforestation increased
in the Cerrado
Wageningen Economic Research | White paper on sustainable commodity production 13
5 Structural change is essential for all smallholder commodity
farmers to earn a living income
One highly important structural change is land
reform, to ensure that farm sizes increase.
Our research shows that often, farm sizes in cocoa and
tea producing countries are much smaller than so-called
‘sustainable farm sizes’, i.e. farm sizes needed to earn a
living incomexlix. Increasing farm size is a path worth
exploring. However, this is often not an option, as most
land is already occupied and buying land is costly. Labour
requirements to create new farms are expensive and have
led to different share cropping arrangements between
farmers and workers, where a proportion of the harvest or
land is shared, known as abunu, abusa and abunal.
Farmers may start by receiving a small piece of land in
return for their labour. Thus, increasing farm land can
typically only happen in forested areas, which are often
formally owned by the government. Also, inheritance laws
lead to land fragmentation. To increase farm sizes there-
fore, a large transition is needed, in which one segment of
farmers would increase their farm sizes and another
segment of farmers would stop their farming altogether,
consequently seeking employment opportunities outside of
agriculture. Lessons for this transition can be learned from
historical examples of agricultural land reform processes
in Europe and elsewhere. Scaling up smallholder farming
requires the deep involvement of public sector, civil
society and private sector playersli.
Land reform requires adequate employment oppor-
tunities for farmers moving out of agriculture.
While land reform poses opportunities to increase farmer
income for some, it also poses a challenge for other
farmers who can no longer grow cocoa or tea. In order to
create space for larger farms that can generate a higher
income, other farmers need to nd employment else-
where. Some farmers can continue in the agricultural
sector, either as employees of larger farmers or elsewhere
in the agricultural value chain, in processing, trading or
service activities. As farm sizes increase and farmer
revenues increase, more investment in added value
activities in the value chain is possible, thereby generating
employment for farmers that had to quit farming. Other
employment opportunities could be found outside of
agriculture, mainly in larger towns and cities. Already
now, we understand that many young people in rural
areas of developing countries leave the countryside since
they no longer see a future in farming. This is presents
signicant challenges that governments and cities are
already trying to address.
Structural changes are not new in rural develop-
ment thinking, but broader policies are needed, and
multiple stakeholders should collaborate to imple-
ment them.
Even in the 1970s and 1980s, similar changes were
proposed, such as the ‘integrated rural development
policies’ which were also focused on moving away from
small-scale agriculture. They strongly suggested increas-
ing local agro-processing in order to, among other things,
create more local employment opportunitieslii. An impor-
tant lesson learned from these policies was that they were
less effective when scaled up to the national level, as this
no longer allows communities to mobilise their own
resources for development or for real strengthening of the
development of local public sector agenciesliii. Some major
differences between then and now include the movement
away from rural thinking towards urban development and
job creation. More important is the change in responsibili-
ties from the public sector only to a shared collaboration
between the public and the private.
Price increases lead to short-term benets for
farmers, but increases could have negative long-
term effects on the market, which could lead again
to pressure on prices.
Price interventions in global markers often have limited
effects when they are only applied at the country or
regional level. If prices are raised by individual country
policies, buyers of cocoa and tea can purchase cocoa and
tea in other countries instead, where prices are lower.
Moreover, raising cocoa and tea prices will lead to more
farmers growing them and spur existing farmers to
increase production. This puts more pressure on forests
for land expansion. If no policies are implemented to
mitigate such effects, total volume produced will increase,
creating national and global surpluses. This may lead to
farmers not being able to sell their cocoa, thereby reduc-
ing their incomes and causing market prices to fall again.
An example here is the Brazilian coffee sector where ‘at
various times during the last century, (1906, the 1930s
and the early 1970s) the coffee giant had to destroy many
millions of bags of green coffee [] to prevent a glut in the
market’liv.
The living income differential in Ghana and Côte
d’Ivoire seems to be a good solution, but could it
also backre?
The recent living income premium (called ‘living income
differential’) set by Ghana and Côte d’Ivoire is intended to
help increase incomes of farmerslv. As both countries
together are responsible for two-thirds of global cocoa
production, this premium may in the short term have no
Wageningen Economic Research | White paper on sustainable commodity production 14
effects on cocoa sales. But in the long term, effects as
described in the previous paragraph could materialise.
This development is likely to inspire buyers to see whether
they could buy their cocoa for a lower price elsewhere.
This may also increase the global market price for cocoa
to which farmers in other countries respond by planting
more cocoa. Such demand and price increase could spike
cocoa production and sales in for instance Brazil and
Indonesia, with severe repercussions:
• lower cocoa sales for Ghanaian and Ivorian farmers,
leading to income decreases which could counteract
earlier increases
• massive unsold cocoa stocks at public sector level in
Ghana and Côte d’Ivoire, leading to pressure on public
sector budgets because farmers are paid while the cocoa
cannot be exported.
So, without other policies in place to address such volume
and budget challenges, price levels established by the
public sector are bound to have negative effects.
A precondition for increasing prices without creating
negative effects is a system of international supply
management, led by producing countries.
Since the cessation of international cocoa agreements in
the mid-1980s, among which included export quotas,
beans have been traded internationally in a free market.
This resulted in a period of low prices throughout the
1990s. To cope with the collapse of prices and with a
value-sharing scheme that is considered unfair, Koning
and Jongeneel suggested in 2008 the creation of a ‘cocoa
OPEC’ among the main producing countries. The idea was
‘parked’ as prices of raw materials including cocoa in-
creased between 2008 and 2015. However, in response to
the recent price fall and with the voluntarism of the
African public sectors, whose economies were directly
affected, the creation of an ‘OPEC for cocoa’ is explicitly
mentioned in the declaration of the last conference of the
International Cocoa Organisation (ICCO, April 2018). The
World Bank, in its latest report on Ghana (2018), also
stresses the need to strengthen cooperation between
Ghana and Côte d’Ivoire as prerequisite to gaining more
market power. If such international supply management
system is developed, it should be led by producing
countries, who involve farmers and their organisations,
include production controls in a fair and efcient way, and
prevent countries from free ridinglvi. For a 10-step action
plan to implement this, see Koning & Jongeneel (2006),
and Koning & Jongeneel (2008)lvii.
Policies should consider climate change forecasts,
as it is expected by 2050 that in many regions it will
be difcult to produce tea, cocoa and coffee.
Recent studies show that climate change is expected to
make large parts of cocoa and tea and coffee growing
areas much less suitable for growing these cropslviii. In
some areas, growing these crops will no longer be possi-
ble without far-reaching adaptation activities. To address
these issues at farm-level, farmers can plant improved,
more climate-resilient varieties or develop infrastructures
for irrigation. However, these strategies often require
substantial investments, which many smallholder farmers
do not have readily available. Irrigation infrastructure also
goes beyond farm scale, as it requires fair and wise
management of scarce water resources, not only between
farmers, but also between farming and other sectors.
Predicted climate impacts on cocoa and tea productivity
therefore also require regional or landscape approaches
which design policies that address all the consequences of
climate change for one area.
In some areas, growing these crops
will no longer be possible without
far-reaching adaptation activities
Prediction on suitability of tea growing areas (2020 and 2050)
Source: Managua (2011).
Wageningen Economic Research | White paper on sustainable commodity production 15
This requires supporting farmers in affected areas
to change land use entirely in order for them to earn
a living income, by actors needing to provide differ-
ent services to the farmers than in the past.
In areas affected by climate change, farmers can be
supported in diversifying their income-generating activities
to complement the income from tea or cocoa, or they can
be facilitated in shifting from cocoa and tea as their main
source of income to other crops or income-generating
activities. Interventions to address climate change should
more often facilitate the latter instead of keeping farmers
in the production of crops which their land will no longer
be suitable for in the future. By considering projections for
the future, the public and private sector try not only to lift
farmers out of their poverty, but also make sure they stay
out of poverty. This requires that the public sector and
service deliverers work differently; tea and cocoa coopera-
tives would support their farmers in producing other crops/
livestock, providing technical assistance and inputs not
only for cocoa and tea, and facilitate farmers in marketing
the new products. Thus, public sector agencies, service
deliverers and buyers implementing programmes with the
farmers would need to diversify their support as well.
Diversication can contribute to income, resilience
and improved nutrition, but is not suitable for all
farmers.
Diversication can help farmer to increase their total
income, while improving their resilience by reducing their
reliance on a crop. Moreover, diversication can help
farmers increase the diversity in their diets, contributing
to greater balance and nutrition. Earning additional
income through diversication is not always possible for
all farmers, however. This is only possible when there is a
market for these products or activities. This can prove
difcult in remote, sparsely populated and relatively
inaccessible rural areas. Market development should be
supported alongside supporting farmer diversity, focusing
on improvements in nutrition, in addition to increasing
incomes. Moreover, many cocoa and tea farmers have
small farm sizes, which limits the land available to diver-
sify their income. Finally, many cocoa and tea farmers lack
the resources to invest in developing new economic
activities; therefore, income diversication is more
suitable for farmers with enough assets.
Pineapple eld next to tea eld: Some tea farmers in Kenya have uprooted their tea bushes because they can earn more from pineapple.
Photo: Yuca Waarts
Wageningen Economic Research | White paper on sustainable commodity production 16
6 What public and private sectors can do: conclusions and
recommendations for lifting smallholder commodity farmers out
of poverty and protecting forests and biodiversity
The poorest smallholder commodity farmers need
different policies for earning a living income than
relatively better-off farmers.
For the poorest farmers to earn a living income, manifold
increases in income would be required, which is not
feasible given farmers’ situation in terms of land size and
productivity levels, not to mention given how the market
currently operates. We identify the structural changes that
can facilitate increases in income of the poorest commod-
ity producers:
1 Land reform policies should seek to increase farm sizes.
This is impossible without farmers moving out of
agriculture, who need to be properly supported to nd
alternative income sources. The land reform process
should ensure that no human rights are violated. And
should address inheritance laws.
2 Land reform policies should be informed by climate
change forecasts (as in some areas tea or cocoa may
not grow anymore), urbanisation and other demographic
trends.
3 Price increases seem a viable option, and could lead to
income increases for farmers, but they also could have
negative effects on the market over time, leading to
buyers changing sourcing countries and surpluses,
putting pressure on market prices yet again. Also, price
increases on their own are not enough to lift the poorest
farmers out of poverty. Price increases thus must go
hand in hand with land reform policies.
4 A precondition for increasing prices without creating
negative effects is a system of international supply
management led by producing countries. Furthermore,
farmers and their organisations should be involved in
this system, which should include production controls in
a fair and efcient way and prevent countries from free
riding. For a 10-step action plan to implement this
system, see Koning & Jongeneel, 2006, and Koning &
Jongeneel, 2008lix.
Support in productivity increase and on-farm diver-
sication can be useful for relatively better off
farmers under certain conditions.
Interventions to increase commodity productivity, along
with support of on-farm diversication focused on income
increase and food security, can be useful in some cases,
but only under the following circumstances:
1 The intervention targets the right group (farmers who
earn enough to invest, and have a large enough farm
size).
2 The aspirations, needs, opportunities and behavioural
drivers of farmers are taken into account via a farming
systems approach that does not focus solely on com-
modity production.
3 The intervention should be informed by climate change
forecasts and market developments in order to ensure
the intervention is ‘future proof‘. This could mean that
farmers are supported to change their land use entirely
to continue earning an income in the long run. Such
land use changes should be informed by possibilities in
marketing the produce.
In addition to the above conditions for success, land
reform and price increases can also help to improve
incomes of these farmers.
To protect forests and biodiversity, all causes of
deforestation need to be addressed simultaneously
through multi-stakeholder collaboration.
By all accounts, the most effective strategy for responding
to all causes of deforestation is multiple interventions at
once. Such interventions should be implemented through
multi-stakeholder collaboration, including conducting
appropriate baselines and taking into account leakage and
spill-over effects.
Learning from each other: sharing positive and
unsuccessful experiences data and methodologies
to design effective and efcient interventions.
For designing effective and efcient interventions, ndings
should be shared between countries and across commodi-
ties on what works and also what failed to work. This
includes the sharing of data and methodologies in order to
avoid too much data being collected too many times, with
too many farmers being interviewed too often, to satisfy
the needs of various buyers and implementers. Much data
has been collected in the past but has remained conden-
tial. We call on the private and public sectors as well as on
NGOs and business platforms to nd a way to share data
and methodologies without jeopardising business and
public interests. A good example is the Cocoa Soils
Initiative, https://cocoasoils.org/.
Please nd detailed steps that we propose to be under-
taken for smallholder commodity farmers to earn a living
income and for forest and biodiversity protection in
Appendix 2.
By all accounts, the most eective
strategy for responding to all causes
of deforestation is multiple interventions
at once
Wageningen Economic Research | White paper on sustainable commodity production 17
7 Research agenda to support structural transformation:
a need for transformational science to facilitate
smallholder farmer sustainable development
How can the private and public sectors collaborate more effectively with
academics to lift smallholder farmers in commodity sectors out of poverty
and support forest protection/reforestation?
A research agenda to positively transform smallholder commodity farming
Farming system research acknowledging community
and landscape scales
The dramatic change from the common private sector data
collection focus on individual commodity purchases means
that we should take a farming and household system
approach. This is to understand why and how farmers
make choices for different cash and subsistence crops,
livestock and on and off farm activities and land uses –
and, by extension, the tradeoffs between different crops
and business models. This change ts with a living income
approach, acknowledges the role of labor and technologies,
and it seeks to provide data that can support efforts to
increase total disposable income as well as food and
nutrition security. This information can also help us
understand the implications of how interventions that focus
on deforestation and environmental degradation have an
impact.
Better understanding of farmer’s aspirations, assets
and capacities
Better understanding the combination of farmer’s aspira-
tions, needs, knowledge, assets and capacities is of utmost
importance. This is a change from the current practice of
‘sending messages’ through interventions, towards
listening to farmer’s household and individual members
changing needs and how farmers can benet from the data
they help generate. This implies a focus on contextually
applied recommended agricultural practices rather than
meeting (externally set) standards.
Pathways to transforming farming systems, markets
and landscapes
We must investigate and understand what it takes to
(further) develop and diversify smallholder commodity
products, markets, and processing facilities such that more
added-value remains in the country of origin and with
farmers and labourers in commodity value chains. It is
additionally important to grasp the motives of farmers to
expand in forested areas and the political reality driving
such expansion. Trade-offs and implications of maintaining
the value of sensitive and high-risk and high conservation
value landscapes must be fully accounted for, in response
to zero deforestation concerns and initiatives.
New research models focusing on commodity
farmers and sectors are needed.
To meet the challenges addressed in this paper, the
questions asked by scientists, private and public sector
organisations and other stakeholders need to be critically
reviewed, in addition to the fundamental ways that
science is conducted, how scientic outputs are produced
and, last but not least, for whom. Different models of
conducting and disseminating research inform the sectors
and value chains in which smallholder commodity farmers
operate, ranging from academic to in-house corporate to
origin state research. These different models (see
Appendix 3) result in scientic outputs accessible to
different users in very different formats. As the commis-
sioners of scientic research vary, each model functions
according to different agendas often meeting different
aims, covering different geographic and political scales.
There are two clear disadvantages of these parallel,
multiple models of science.
One disadvantage is that despite the decades of research
into smallholder commodities such as tea, coffee and
cocoa, scientic knowledge has not effectively reached
farmers, or wider farm and ecosystem products and
services, in a way that could substantially change their
position in these commodity value chains. Science has
focused on and beneted other actors in smallholder
commodity value chains, particularly those commission-
ing, funding and consuming the products. Second is that
the lack of signicant changes in livelihood indicators such
as incomes and degradation in many environmental
indicators (trees on farms, forest cover, soil and water
quality), strongly points towards ineffectiveness when
gauging how scientic knowledge and research models
have impacted smallholder farmers.
Future research approaches should address the
complex make-up of smallholders.
Most of the publicly accessible research is deeply divided
by language, sector and geography, thereby hindering
cross-regional and cross-commodity sectoral learning and
exchange. This is despite many actors conducting science
work on multiple commodities. Currently, most research
is predominantly structured according to disciplines.
Wageningen Economic Research | White paper on sustainable commodity production 18
By contrast, highly complex challenges with many trade-
offs require more inter- and multi-disciplinary approaches,
where the vast body of crop production research is
integrated with economics, politics, livelihoods (incomes,
health, labour etc.), communication, innovation and
technology.
A research agenda for inclusive, resilient smallhold-
er commodity value chains.
Taking these issues into account, the cocoa sector created
a consensus on societally relevant research needslx.
Building on this history, we propose a research agenda
that addresses knowledge gaps in order to positively
transform smallholder commodity farming (see the box
above). This agenda requires taking an integrated,
multidisciplinary, international and collaborative approach
to research. This could take a more co-designed approach
to design, implement and disseminate research. This
entails developing collaborative research models investi-
gating options and approaches to funding, generating and
ownership of data and results between farmers, farmer’s
organisations, traders, manufacturers, researchers and
other stakeholders. It also means engaging smallholder
farmers and origin country public sector agencies in the
co-design of research, and in making co-generated
knowledge outputs much more available, if they are to
adequately respond to the issues addressed in this paper.
By engaging with public sector agencies, additionality is
created, even in so-called weak stateslxi. Equally, voluntary
sustainability standard systems largely implemented by
the private sector have increasingly realised the benets
of collaborating with NGOS and public sector authorities
– initially as trainers as in Côte d’Ivoire in the cocoa
sector, but increasingly as partners. These private volun-
tary certication schemes have sparked reactions by origin
country public sectors claiming back sovereignty over their
territory and the welfare of their inhabitants, the commod-
ity producing smallholders. The joint action by Ghana and
Côte d’Ivoire to create a living income differential is one
example. The mandatory and gradually rolled-out certi-
cation schemes recently introduced for palm oil cultivation
by public sector organisations in Indonesia and Malaysia is
another example. A third is the Mozambican national
biofuel certication in response to EU biofuel
certicationlxii.
Wageningen Economic Research | White paper on sustainable commodity production 19
Appendix 1: Methodology
Literature review
The literature review conducted for writing this paper
focused on overview studies and systematic reviews and
was based on WUR researchers’ knowledge of the litera-
ture; we did not conduct a systematic review of all
literature for writing this paper.
Literature and primary data from Wageningen UR
studies are presented in this paper:
• Cocoa Ghana: Data collected for impact evaluation
studies nanced and commissioned by Solidaridad and
UTZ Certied (Waarts et al. 2015). The year about
which we present the gures in this paper is 2014. WUR
was granted permission to use the condential data
from this study for this paper. The opinions expressed in
this publication are those of the authors. They do not
purport to reect the opinions or views of the commis-
sioners of this study. The designations employed in this
publication and the presentation of material therein do
not imply the expression of any opinion whatsoever on
the part of the commissioners.
• Cocoa in Côte d’Ivoire: Data collected for and impact
evaluation studies nanced and commissioned by
Solidaridad, UTZ Certied, Cargill, IDH and Nestlé
(Ingram et al. 2014, 2018). The year about which we
present the gures in this paper is 2017. WUR was
granted permission to use the condential data from this
study for this paper. The opinions expressed in this
publication are those of the authors. They do not
purport to reect the opinions or views of the commis-
sioners of this study. The designations employed in this
publication and the presentation of material therein do
not imply the expression of any opinion whatsoever on
the part of the commissioners.
• Tea in Kenya: Data collected for an impact evaluation
study nanced and commissioned by KTDA, IDH and
Unilever (Waarts et al. 2012, 2014, 2016, 2017). The
year about which we present the gures in this paper is
2015
Way of calculating what percentage of farmers is
placed in which income group.
Group 1: Consists of farmers who earn less than the World
Bank poverty line of 1,90 USD per person per day. This
excludes farmers who, with a 10% increase in total
household income earn the same or more than the World
Bank poverty line of 1,90 USD per person per day.
Group 2: Farmers who earn minimally as much as the
World Bank poverty line of 1,90 USD per person per day,
and maximally below the living income benchmark. This
includes farmers normally placed in group 1, but who,
with a 10% increase in total household income earn the
same or more than the World Bank poverty line of 1,90
USD per person per day.
Group 3: Farmers who earn the same or more than the
living income benchmark per person per day.
Living income benchmark calculations
For each country, household incomes were converted to
match the living income benchmark:
• Ghana: Smith, S. and D. Sarpong. (2018). Living
Income Report: Rural Ghana. Retrieved from https://
cocoainitiative.org/wp-content/uploads/2018/12/
LIVING-INCOME-REPORT-FOR-GHANA.pdf
• Cocoa Côte d’Ivoire: Tyszler, M., R. Bymolt, and A.
Laven (2018). Analysis of the income gap of cocoa
producing households in Côte d’Ivoire. Retrieved from
https://docs.wixstatic.com/ugd/0c5ab3_fc3386a-
550b94a898c7757ee13ab59e6.pdf
• Kenya: Anker, R. and M. Anker (2015). Living Wage
Report Kenya: with a focus on rural Mount Kenya Area.
Retrieved from https://www.isealalliance.org/sites/
default/les/resource/2017-12/Kenya_Living_Wage_
Benchmark_Report.pdf
The monthly living income benchmarks were converted to
the year of each dataset using the changes over time in
the consumer price index. The living income benchmark is
based upon a country specic average family size (6 in
Côte d’Ivoire, 5 in Ghana, 5.5 in Kenya). Therefore, yearly
household income from each of the datasets was adjusted
only for the period: it was divided by 12 to change the
data from yearly to monthly income. For comparison with
the World Bank poverty line, the monthly living income
line per family was converted to a daily living income per
household member. By doing so, we treated adults and
children in the households in the same way, not correcting
for male or female equivalent FTE values.
Poverty line benchmark calculations
For each country, household incomes were converted to
match the poverty line of $1.90 per person per day. This
poverty line was set in 2011, and was adjusted to the year
of the data using the difference in time using the consum-
er price index. The yearly household level income data
was converted to daily income by dividing by 365, and
then divided by the number of household members.
Wageningen Economic Research | White paper on sustainable commodity production 20
Appendix 2: detailed steps to be undertaken for smallholder
commodity farmers to earn a living income and for forest and
biodiversity protection
Action Approach Involved stakeholders
Land reform • Start a land reform process to create new land use
policies, which leads to farmers to move out of
agri culture to make it possible for remaining farmers
to earn a living income. Such a process should be
inclusive, discussing needs and possibilities with
the affected population. And should address
inheritance laws.
• Provide alternative income earning opportunities for
people moving out of agriculture by for instance
establishing arrangements so they can become
absentee land owners. Ensure that human rights are
not violated in this process.
• In creating new land use policies, consider climate
change forecasts and demographic trends such as
urbanisation, and forest and biodiversity protection
targets.
• Investigate what alternative livelihoods could be if
expected climate change effects materialise,
including conducting land suitability analyses, and
studying the feasibility of new market/supply chains.
• Learn from similar land reforms processes and
effects in Europe.
• Next to land use policies, such land reform process
should also lead to policies for protecting forests and
biodiversity considering the lessons learned in this
paper.
• The public sectors in origin countries are in the
driver’s seat of land reform processes.
• The private sector to support the origin country
public sector to implement such land reforms as they
are an important stakeholder for the origin country
(export revenues), and they can also continue
sourcing from the country without being accused of
violating human rights.
• EU public sector organisations to support origin
public sector organisations in learning about land
reform policies implemented in the past.
Inuencing the market and
farm gate price
• Governments to establish the market price for a
commodity together, in collaboration with farmers
and their organisations, but only if they can avoid
surpluses in the production of the commodity.
• Quota systems could be used, but the question is
based on what criteria it will be decided who get
what quota, as quotas are generally exclusive, not
inclusive. Would non-cocoa producing countries still
have the possibility to produce cocoa? Lessons could
be learned on whether an OPEC is possible for cocoa
based on the 10-step plan developed by Koning and
Jongeneel (2006 and 2008).
• Buyers to close long-term contracts with sustainabi-
lity performance criteria connected to higher prices
for a commodity. However, the performance criteria
should be possible to achieve by the farmers without
them taking all the risk.
• Public sector organisations in origin countries
• The private sector to nd creative ways in the value
chain together, e.g. by reducing cost, to optimise the
price paid to smallholder farmers.
• Consumers should (be enticed to) pay more for
chocolate.
Capacity development of
remaining commodity
producing farmers to
increase productivity and
quality and increase
incomes
• Support remaining farmers in climate change
adaptation (e.g. drought resistant clones), and
enhancing productivity and quality through training
and input supply, etc.
• This support should be done while considering the
whole farming system and contextual and personal
factors to optimise the possibility to inuence
farmers and households to change their behaviour
and have an impact. This support should include
nding ways how to overcome a period with less
income due to replanting bushes/trees with new
clones, without the farmers to take all the risk.
• Companies can support farmers from which they
source--especially when farmer unions have a voice.
• Whole farming system approach does not seem to
suit commodity buyers but it may be needed for
them to continuing sourcing cocoa or tea.
Forest and biodiversity
protection
• Address multiple drivers of deforestation/biodiversity
loss simultaneously.
• Properly implemented multi-stakeholder collabora-
tion, including conducting baselines and considering
leakage and spill-over effects.
• The public sector in origins together with the private
sector and NGOs.
Learning from each other:
sharing positive and
unsuccessful experience
and data and methodolo-
gies
• Sharing learnings between countries and across
commodities of what works and also what failed to
work.
• Sharing data and methodologies in order to avoid
too much data to be collected multiple times and
too many farmers to be interviewed too often.
• The private sector, the public sector, standard setting
bodies, NGOs.
• Universities: a good example is the Cocoa Soils
Initiative: https://cocoasoils.org/
Wageningen Economic Research | White paper on sustainable commodity production 21
Appendix 3: Science models used in smallholder farming research
Characteristics Science model
Academic research In-house corporate Stakeholder Origin state International
research
Research
commissioners &
funders
Internal according to
individual preferences and
departmental focus
Responding to calls for
projects from international
and national trade,
research and government
organisations, stakeholders
& private sector funders
Contract research to
private sector
Internal led by
corporate policies
and sector-wide
agreements and
practices
In public-private-
state partnership
programmes
Internal led by
organisational policies
and for (international)
NGOs and CSOs,
member based
In public-private-state
partnership projects
Internal led by
national policies
from state agencies,
In public-private-
state partnership
projects/
Internal led by
organisational policies
Responding to calls
for projects from
international and
national organisa-
tions, stakeholders
and private sector
Research agents Universities, research
institutes
Internally in-compa-
ny and/or with
universities and
research institutes,
consultants and
NGOs
Internally in-company
and/or with universi-
ties and research
institutes, consultants
and NGOs
State organisations,
universities and
research institutes
Universities and
research institutes
consultants, NGOs
Objectives Fill knowledge gaps.
Research outputs in terms
of scientic papers and
recognition.
Agenda setting and arbiter
function distinguishing
between ‘facts’ and
‘ction’, ‘opinions and
beliefs’
Maintain supply base
at reasonable costs
and keep consumers
happy by addressing
their concerns
Depend on NGO either
agenda setting, blame
and shame, or
developing good
practices with
environmental
(deforestation) or
social goals (human
rights, smallholder
welfare, child labour)
Guarantee income
for state from the
sector as it
contri butes a lot to
the economy
Public concerns such
as climate change,
deforestation and
smallholder welfare
Focus Theoretical and applied
research on any aspect of
cocoa and chocolate
production, processing,
marketing and politics
Applied, mainly
activities in value
chains of major
commissioning
manufacturing
companies, in
response to
consumer concerns
Mainly applied research
on key issues in
commodity production,
processing, marketing
and politics
Mainly applied
research on
production,
processing, market,
development and
extension activities
taking place within
national domain
Applied and some
theoretical research
on any aspect of
commodity produc-
tion, processing,
marketing and politics
Methodologies used Scientic
Three types (i) to four-year
thesis studies (ii) medium
term projects (iii)
long-term, multi-year
primary data generation at
plot, farm, farmer, market
and landscape level
Scientic and
quasi-scientic
Increasingly using
multiple year, big
data collected from
farmers and farms
Short- and medium-
term research to
further secure supply
& CSR projects
Scientic methods,
often published without
detailed methodology
Mainly medium to
long-term research
(and development)
programmes/projects
Scientic and
quasi-scientic
Sometimes
published without
detailed methodol-
ogy
Scientic and
quasi-scientic
Sometimes published
without detailed
methodology
Mainly medium to
long-term research
(and development)
projects
Typical end-users Academics,
Some times private sector,
CSO/NGO and
policy makers
Large-scale private
sector
Companies, stakehold-
ers, academics and
farmer organisations
Extension agents,
government
authorities and
agencies
Companies, farmer
organisations, cocoa
sector service
providers, academics
and government
agencies
Scale of research Local, national,
trans national
Local and transna-
tional
Local, national,
transnational
Local and national Local, national,
transnational
Modes of access to
research results
Theses in libraries (digital
and hard copy), publica-
tions in academic journals
(majority in paid access,
increasingly number in
open access journals)
Majority in internal
corporate reports
often concerns
competitively
sensitive information
and some academic
publications
Reports on websites,
generally publicly
available
Reports, on
websites, some
publicly available,
some materials for
farmer organisa-
tions and service
providers
Reports on websites,
generally publicly
available, some
materials for farmer
organisations and
service providers
Language English, some French,
some Spanish
National language,
English
Majority English
translations
National language English, some French
Examples.
This list is not
meant to be
complete
CIRAD, WUR, Trinidad, KIT,
University of Reading, etc
Mars, Olam, Cargill,
etc.
OXFAM, Voice Network,
IDH, WCF, ICCO,
Swisscontact, GIZ.
COCBOD, National
Indonesia Palm Oil
Institute, etc.
CGIAR, IITA, CIAT,
EFI, Agrinatura, etc.
Wageningen Economic Research | White paper on sustainable commodity production 22
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Endnotes
i The Economist (2017): ‘In economic terms, commodities are vital
components of commerce that are standardised and hence easy to
exchange for goods of the same type, have a fairly uniform price around
the world (excluding transport costs and taxes) and help make other
products. They are extracted, grown and traded in sufcient quantities
that they underpin highly liquid markets, often with futures and options to
help producers and consumers protect themselves against price swings.
They include cocoa and coffee, zinc and copper, wheat and soyabeans,
silver and gold, and oil and coal among numerous other raw materials’.
https://www.economist.com/the-economist-explains/2017/01/03/
what-makes-something-a-commodity. Accessed 4 November 2019
ii Waarts et al. (2012), (2014), (2015) and (2016); Ingram et al. (2014) and
(2017), Dalberg and Wageningen University (2018), Woodhill et al. (2019),
Oya et al. (2017), ITC (2011)
iii Conrmed in Dalberg and Wageningen University & Research (2018).
iv London Declaration on price levels, price volatility and the long-term
sustainability of the coffee sector (23/9/2019), The living income premium
of USD400 a tonne that the governments require buyers to pay in Ghana
and Côte d’Ivoire for cocoa from the 20/21 season. Rainforest Alliance
(2019). Driving Better Livelihoods: Why the Fight for a Living Wage and
Income Is Essential to Creating Sustainable Supply Chains, 24 October
2019
v Kissinger et al. (2012), Ruf (1998), Sassen et al. (2013), Vijay et al.
(2016), Euler et al. (2016), Austin et al. (2017)
vi Kissinger et al. (2012), Ruf (1998), Sassen et al. (2013), Vijay et al.
(2016), Euler et al. (2016), Austin et al. (2017)
vii Ludwig (2018), NYDF (2019), CDP (2019)
viii Vidzraku (2018), Angel, Aboa and Hunt (2019)
ix ICCO (2019)
x Waarts et al. (2019)
xi Kozicka et al (2018), Wessel, et al. (2015), Gockowski and Sonwa (2011).
Wang et al. (2015), Perfecto et al. (2005)
xii Ingram et al. (2018)
xiii Waarts et al. (2016)
xiv Bymolt et al. (2018)
xv Waarts et al. (2015) and (2016); Ingram et al. (2014), (2017) and (2018).
xvi Prokopy et al. (2008), Greiner et al. (2009)
xvii E.g. Conley and Udry (2010)
xviii E.g. Gine and Yang (2009)
xix Nin-Pratt and McBride (2014)
xx Bold et al. (2015)
xxi Loevinsohn et al. (2013), Stewart et al. (2015) and (2016)
xxii Bulte et al. (2014)
xxiii Bold et al. (2015)
xxiv Bandiera and Rasul (2006)
xxv Curtis et al. (2018)
xxvi Boucher et al. (2011), Kissinger et al. (2012)
xxvii Ingram et al. (2014)
xxviii Schweik (2000)
xxix Uusivuori et al. (2002)
xxx Jopke and Schoneveld (2018)
xxxi E.g. Rudel and Roper (1996), Angelsen and Kaimowitz (1999), Carr et al.
(2005), Lambin et al. (2001)
xxxii Sassen et al. (2013)
xxxiii Gaveau et al. (2016)
xxxiv Arts et al. (2018)
xxxv Angelsen (2010), Angelsen et al. (2001); Tomich et al. (2001)
xxxvi Angelsen et al. (2001)
xxxvii Tomich et al. (2001)
xxxviii Ferraro et al (2011), Geldman et al. (2013), Spracklen et al. (2015)
xxxix Jezeer and Pasiecznik (2019)
xl NYDF (2019)
xli Ludwig (2018), NYDF (2019)
xlii Busch and Ferretti-Gallon (2017), Taheripour et al. (2019), Stevens et al.
(2014), Tauli-Corpuz et al. (2018)
xliii Garrett et al. (2019)
xliv Macedo et al. (2014)
xlv Villoria and Hertel (2011)
xlvi CDP (2019)
xlvii NYDF (2019)
xlviii Brouwer et al. (2015)
xlix See also Giller (2019)
l Ruf (2010)
li Muilerman (2019)
lii Rondinelli, D. A. (1979)
liii Ruttan, V. W. (1984)
liv Luttinger and Dicum (2012)
lv Vidzraku (2018)
lvi Koning N. and R. Jongeneel (2006)
lvii Koning N. and R. Jongeneel (2008)
lviii Laderach et al. (2013), FAO (2015), Davis et al. (2012)
lix Koning N. and R. Jongeneel (2006), Koning N. and R. Jongeneel (2008)
lx See for example the Abidjan Declaration (2012), Ingram et al. (2014), van
Rijn et al. (2016) and the outcomes of the ICRC 2017
lxi Muilerman (2019)
lxii Schut et al. (2014)
Photocredits
Neil Palmer/CIAT: page 2, 7
Francesco Veronesi: page 10
John Wollwerth / Shutterstock.com: page 18
Shutterstock: page 1, 3, 12
Petra Siebelink / Wageningen University & Research, Communication Services: Infographics page 9 and 10
The mission of Wageningen University & Research is “To explore
the potential of nature to improve the quality of life”. Under the
banner Wageningen University & Research, Wageningen University
and the specialised research institutes of the Wageningen
Research Foundation have joined forces in contributing to nding
solutions to important questions in the domain of healthy food and
living environment. With its roughly 30 branches, 5,000 employees
and 10,000 students, Wageningen University & Research is one of
the leading organisations in its domain. The unique Wageningen
approach lies in its integrated approach to issues and the
collaboration between different disciplines.
Contact & information
Yuca Waarts
Senior researcher sustainable value chains
Wageningen Economic Research
PO Box 29703
2502 LS Den Haag
The Netherlands
wur.eu/improve-sustainability
Wageningen Economic Research | White paper on sustainable commodity production 26
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