A living income is a crucial concept in the cocoa sector, referring to the net annual income required for a household in a particular place to afford a decent standard of living for all members of that household. Elements of a decent standard of living include food, water, housing, education, healthcare, transport, clothing, and other essential needs, including provision for unexpected events. Despite the global demand for chocolate, around 75% of cocoa farmers still earn below a living income due to several interconnected challenges.
One fundamental challenge is that for decades, farmers have not received adequate payment for their cocoa, as buyers and large chocolate companies have consistently paid prices that do not cover the true cost of sustainable production. This longstanding issue has deeply contributed to poverty among cocoa farmers.
Additional challenges include the prevalence of small farm sizes, which limits the total volume of cocoa that farmers can produce and sell. Price volatility in global cocoa markets often means farmers receive unstable and sometimes insufficient payments for their crop. Low productivity, caused by aging trees, poor farming practices, and the impacts of climate change, further reduces farmers’ income potential. Socioeconomic factors such as limited access to finance, education, and markets also constrain farmers’ ability to improve their livelihoods sustainably.
This income gap drives poverty and forces many farmers into unsustainable practices, perpetuating a cycle of low yields and environmental degradation.
Ensuring a living income in cocoa supply chains requires fair pricing, sustainable farming methods, improved productivity, and stronger supply chain transparency. International initiatives and regulations, such as the European Union’s Corporate Sustainability Due Diligence Directive (CSDDD) and the EU Deforestation Regulation (EUDR), push for greater accountability and support for farmers. Collaboration between governments, industry, civil society, and consumers is essential to create a cocoa sector where farmers can thrive rather than merely survive.
Good Chocolate Hub is dedicated to addressing these challenges by promoting awareness, supporting fair trade, and encouraging innovative solutions that enable cocoa farmers to earn a living income.
Sources
Center for Development and Environment, University of Bern (2024): Cocoa Pricing for a Living Income: Mechanisms, Regulatory Levers, and Limitations
Voice Cocoa Network: Living Income
Swiss Platform for Sustainable Cocoa (SWISSCO): Living income
OXFAM Briefing Paper (2025): Raising the Bar- Supermarkets must urgently address structural exploitation of cocoa farmers.
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