Nestle upsets Fairtrade over KitKat cocoa sourcing

Nestle said Tuesday it would source cocoa for British KitKats from Rainforest Alliance-certified producers, ditching a 10-year association with Fairtrade which claimed a lifeline for poor farmers was being cut.

The Swiss food giant said it was making the switch in October to Rainforest Alliance, one of the major certification bodies for sustainable development products, to harmonise its sourcing accreditation.

The move applies to cocoa produced in Ghana and the Ivory Coast for its KitKat chocolate wafers sold in Britain and also in Ireland.

"We have a very large portfolio of confectionery products globally, and the rest is certified by the Rainforest Alliance/UTZ, so it makes sense for us as a business to have one scheme for responsible sourcing across the board," Nestle said in a statement.

Fairtrade said it amounted to a cutting "a real lifeline for some of the world's poorest farmers" by removing the Fairtrade Premium, which it said has meant communities have been able to invest in "classrooms, dispensaries, canteens, and programmes to help women".

Fairtrade Foundation chief executive Michael Gidney added: "We urge Nestle: listen to farmers, do not choose this moment of global crisis to exacerbate the inequalities in the cocoa industry."

But Nestle insisted that while it won't be paying the Fairtrade premium, "we will in fact be paying more for cocoa in the 2020-21 season than we have done this season with Fairtrade."

The firm said it would pay over and above the farm price for cocoa decided by the Ivorian and Ghanaian governments a $400 (350 euros) per tonne premium called the Living Income Differential, plus the Rainforest Alliance premium of $60 per tonne, which goes direct to the farmer.

Nestle said it was aware that the change would have an impact on some farmers.

It said it would therefore also invest in initiatives to support farmers and cocoa-growers, including £1 million ($1.25 million, 1.1 million euros) to develop a "living income pilot" and a further £500,000 for community products.

Nestle said it would also pay for Fairtrade farmers to certify with Rainforest Alliance as well if they wish.