Serving Asia’s Sweet Tooth
Cargill opens its first cocoa processing plant in the region
By Liz Weber March 23, 2015
There was a time when chocolate was hard to come by in many Asian countries. It was considered a novelty, a luxury. But as more people in the region have joined the middle class, they’ve been able to afford more small luxuries—and demand for chocolate has sky-rocketed.
“We’ve seen a significant increase in demand for cocoa products among our customers across the region,” said Job Leuning, business development director for Cargill Cocoa & Chocolate, based in Singapore. “Chocolate is becoming a very popular, mainstream product in Asia.”
Despite some recent doom-and-gloom headlines, Leuning says that Cargill expects demand will continue to grow.
“Rising prices have impacted the cost of the finished product, which has impacted demand, but this is cyclical and temporary,” he said. “The main driver for demand in Asia is the growing middle class, especially in the three most populous countries: China, India and Indonesia.”
Indonesia is also the world’s third largest cocoa-producing country, and now the site of Cargill’s first cocoa and chocolate plant in Asia.
Located in the East Java region of the archipelago nation, the $100 million processing facility opened in December 2014. An inaugural ceremony included Indonesian Minister of Industry Saleh Husin, Cargill Chief Executive Officer Dave MacLennan and Cargill Cocoa & Chocolate Business Unit Leader Jos de Loor, as well as local dignitaries, customers and employees.
“This factory has a significant impact on Indonesia, especially in increasing the volume of downstream cocoa products and pushing the community’s economic activity,” said Husin.
Adding 300 new jobs to the area, the plant will have a 70,000-metric-ton processing capacity. It produces Cargill’s premium brand Gerkens® cocoa powders, as well as high-quality cocoa liquor and butter. It also has capabilities to create tailor-made blends for customers.
Investing in the future
One of the things that the employees in Indonesia are learning about is the Cargill Cocoa Promise, a global commitment to improve the livelihoods of cocoa farmers, their families and their communities, and in doing so, secure a long-term supply of cocoa.
Cargill first launched a sustainable cocoa program in Indonesia in 2012, focusing on South Sulawesi province, one of the main cocoa-growing areas of the country. As part of the program, Cargill established field schools to train farmers on good agricultural practices that improve yields and quality. The program was extended in 2014 and so far has reached more than 4,000 Indonesian farmers.
Like the Cargill Cocoa Promise programs in Vietnam, Ghana, Côte d’Ivoire, Cameroon and Brazil, Cargill partners with a non-governmental organization to implement the program in Indonesia. International development agency Swisscontact provides on-the-ground support and helps ensure the program is tailored to meet local needs.
“Most of the world’s cocoa is grown by between six and seven million smallholder farmers,” said Jos De Loor, business unit leader of Cargill Cocoa & Chocolate. “Our program is global, but we act locally to implement programs that will make a positive and meaningful change.”
Abdul Wahis has experienced these changes firsthand. He is part of a farming community in South Sulawesi province that has participated in regular training sessions.
“The benefits have been huge,” he said. “First we learned how to take better care of the cocoa trees. We also learned about pests and diseases. Before, we only harvested once a month, and after the training we knew that the better way was to harvest more often. So now we harvest once a week instead.”
Good yields and better incomes will be necessary to convince farmers in Indonesia to keep planting cocoa in the future.
The farmers who benefit from the Cargill Cocoa Promise in Indonesia will help supply Cargill’s new plant. Their beans will be collected and transported by truck to Cargill’s buying station in Makassar. From there, they will be shipped to the Gresik plant to make a variety of products, many of which target local taste preferences.
“I like to describe the Indonesian flavor profile as having more natural notes,” said Leuning, explaining that unlike West African cocoa beans, Indonesian beans are not fermented, which means the flavor is naturally lighter, richer in fruitiness and more astringent.
“For this reason, a lot of regional companies would not consider sourcing cocoa powder from our plants in other regions,” he said. “This facility really completes our global cocoa powder portfolio and it enables us to better serve local food manufacturers.”
For the employees of Cargill Cocoa & Chcolate in Gresik, it’s an exciting time to be in the chocolate business in Asia.
“It’s an opportunity for people here,” said Erika Ayudhia, senior accountant at the plant. “We are all proud to be here, now.”