Living Income Webinar 23: Pricing mechanisms in the cocoa sector: options to reduce price volatility and promote farmer value

Price volatility is a common challenge facing smallholder farmers in tropical commodities. Recent developments of a 40% drop in the price of cocoa in West Africa have highlighted how price volatility and extended periods of low prices can undermine the gains of supply chain programs. Jan Willem Molenaar will present findings from research done by Aidenvironment and Sustainable Food Lab on ‘Pricing mechanisms in the cocoa sector: options to reduce price volatility and promote farmer value capture’. He will share the models explored in the paper as well as the main conclusions and recommendations to move towards improved cross-sectoral price and supply management.  We will then focus in on one specific pricing mechanisms being used by Oikocredit and partners to train farmer organizations to manage price risk.  Hugo Villela from Oikocredit will share the pillars of their Price Risk Management initiative, and the learning on factors to enable farmer organizations to successfully implement PRM.