Ritter Sport: "sustainability " more important than organic

Ritter Sport likes to parade its green image. This German chocolate manufacturer does have an organic line in its product range, but it's not doing so well. Four years ago, Ritter wanted to withdraw from its organic business and convert to “sustainable raw materials”, although it didn't carry through its intention. Now, however, the decision has obviously been made. The company is demanding that 3,500 cocoa farmers in Nicaragua acquire UTZ or Fairtrade certification, which in effect will put an end to organic cropping on these farms.

Small farmers in Nicaragua are some of the poorest worldwide. Photo © Karin Heinze

For years chocolate manufacturer Ritter Sport has taken pride in its ecological activities. The latest example is a combined heat and power unit that provides self-generated electricity for 30 percent of its production. From this year its own 2,000 hectare plantation in Nicaragua will supply “sustainably” produced cocoa. The firm's prognosis is that in the long term around 30 percent of the cocoa needed for its square chocolate bars could come from this country in Central America. The Ritter plantation has already been issued with certification by Soil and More. However, it applies only to composting and not to cropping.

For Ritter organic cultivation is quite clearly no longer included in the concept of sustainability. The company has put its cooperation with some 3,500 Nicaraguan small farmers, who have been supplying Ritter Sport with cocoa since 1990 in the Cacaonica project, on a new footing: instead of organic certification Ritter Sport is demanding that from October 2017 they have UTZ or Fairtrade certification.

Ritter Sport owns a 2,000 ha farm in Nicaragua. Photo © Karin Heinze

It was not until 2015 that Ritter Sport commissioned an evaluation of the project in Nicaragua by the prestigious Südwind Institute. In his report Dr. Pedro Morazán, whose area of responsibility at the Institute is poverty alleviation, confirmed the positive impact of the well established Ritter payment model. In a company press release we read: “According to Morazán in his final report, for many families the commercialisation of cocoa is conducive to overcoming poverty. The crucial factors identified by this expert are, above all, working systematically on the quality of cocoa, the price paid for cocoa and raising the volumes cultivated......with fair prices being the most important way to promote farmers and cooperatives. The price model developed by Ritter Sport – a combination of  premium and bonus plus firm purchasing guarantees - enables farmers to plan with confidence and ensures they receive enough to live on.

With Ritter Sport as their reliable business partner the risk to cooperatives of fluctuating prices and unstable markets has been kept to a minimum.” However, since 2015 the price paid to farmers has fallen markedly. At the beginning of this year Ritter paid 2,466 dollars per tonne for conventional cocoa from Nicaragua, and 200 dollars more for organic quality. Two years before, the organic premium was 400 dollars and the price was 3,543 US dollars. At Ritter Sport headquarters they maintain the 25 percent reduction in the price paid to farmers is because of the fall in the world market price. The Nicaraguan small farmers have been put under pressure by this fact alone. They are, quite apart from this, among the poorest people in the world.

Instead of encouraging organic farming Ritter Sport will promote the use of more chemicals in agriculture

What's more, the company is evidently abandoning the payment method praised by the Südwind Institute.  Via the German representation in Matagalpa Ritter has informed the organic cooperatives in Nicaragua that from October 2017 the company will no longer pay an organic premium. The increase in price of nearly 10 percent will still be in place but only for UTZ certification. UTZ sustainability standards are, however, a far cry from the guidelines applicable to organic cultivation. Jaume Martorell, head of purchasing at Ritter Sport in Nicaragua, wrote to a supplier on 8 January 2017 saying that from October this year organic goods will only be purchased from producers with a UTZ or Fairtrade logo. On 27 February 2017 he added: “Whether the goods are produced organically or not is of no interest – they must be certified by  UTZ or Fairtrade.” His explanation was that Ritter's main concern is sustainability. The company argues that social criteria are met  more effectively with UTZ and Fairtrade certification than in the case of organic certification. And in his email Jaume Martorell goes on to say: “Chemical fertilisers are permitted by both certification regimes.”

Together with his wife Elba Rivera and some other people, Gerd Schnepel runs the Finca Esperanzita and he is very worried by these developments. Photo © Karin Heinze

Planing security for organic farms looks different

Gerd Schnepel, consultant and activist at the organic farmers association Sano y Salvo in Nicaragua, deplores the action taken by Ritter. “If you withdraw the organic premium from small farmers, you'll soon see cracks and holes in organic agriculture. If there is no clear commitment to organic growing on the part of Ritter Sport plus a corresponding higher price, there will be a return to pesticides and artificial fertilisers,” says Schnepel, who in the1970s was an organic farmer in Upper Franconia in Germany and also in the USA.

While Ritter Sport sees itself on the home straight in terms of sustainability and by 2020 would like to source “only certified cocoa from sustainable production”, experts like Schnepel and representatives of the organic industry are very critical of giving up organic cultivation. Dr. Pedro Morazán from the Südwind Institute says: “I think Ritter would be well advised to support organic certification and not abandon the good social commitment encouraged by Cacaonica.” Felix Prinz zu Löwenstein, Chair of the Bund Ökologische Lebensmittelwirtschaft (BÖLW), who has a lot of experience of development aid in Haiti, is disappointed by the chocolate manufacturer's new policy: “This is depressing news because for Ritter Sport it means deterioration of the environmental balance in cocoa production. It's also to the detriment of farmers if they return to using pesticides that are a danger to the people applying them.”

Organic farming: good for the farmers and their families and for the environment. Photo © Karin Heinze

Ritter Sport puts the blame on the specialist trade

According to Petra Fix, responsible for PR at Ritter Sport, one of the reasons for this paradigm shift is that the sales of Ritter organic chocolate have fallen in the last three years. She says that for years they have been having serious problems with sales. Her complaint: “The specialist organic trade doesn't list our products.” When asked about advertising and marketing measures to promote the sales of organic chocolate, she has nothing to say. To advertise conventional products, on the other hand, the company spends millions of euros, principally at train stations.

But Ritter doesn't want to close the door on organic once and for all, even though in sweets organic is not currently playing a big role. But as Fix points out: “Maybe sustainability certification is an intermediate step.” She says that Ritter is not married to UTZ but that's where the greater sales opportunities are currently to be found.

Small farmer in Nicaragua. Photo © Karin Heinze

Criticism by the Chocolate Campaign

The recently announced amalgamation of UTZ and Rainforest Alliance is unlikely to change the situation. On the contrary, the merger means more market power for the the new “Rainforest Alliance” label. The present Executive Director of UTZ, Han de Groot, is to become the CEO of Rainforest Alliance. Nigel Sizer, President of Rainforest Alliance, will be the Chief Program Officer, Advocacy, Landscapes and Livelihoods. We are told that, although both organisations want to reduce the use of pesticides and artificial fertilisers, they will not ban them as a matter of principle.

The Campaign "Make Chocolate fair again", that was launched by, among others, the NGO Inkota and the Südwind Institute , gives details in an info-flyer of both sustainability logos. There is significant criticism and it's virtually the same for both organisations: “UTZ Certified does not guarantee producers a minimum price. If the world market price of cocoa falls, producers receive a lower price. Premiums are not prescribed but have to be negotiated by the farmers themselves. In UTZ Certified there is no system for pre-financing or issuing credit.” Moreover, UTZ and Rainforest Alliance offer the farmers hardly any opportunities for participation in decision making. And it goes on: “The logos of Fairtrade, Rainforest Alliance and UTZ Certified do not satisfy the ecological imperatives of an organic logo.” The campaign flyer cites the Naturland association with its Fair certification as a trailblazer in all things organic and fair trade.

Climb-down by Ritter Sport in 2013

In 2013  Ritter was already planning to abolish the organic premium and intended only to pay extra for UTZ certification. Organic Market.Info reported in detail at that time and around a dozen other media reacted to the report. As a consequence Ritter Sport shelved the plan. At the time, public pressure in favour of organic was obviously too great.