The International Cocoa Organization (ICCO) is a global organization, composed of both cocoa producing and cocoa consuming member countries. Located in London, ICCO was established in 1973 to put into effect the first International Cocoa Agreement which was negotiated in Geneva at a United Nations International Cocoa Conference. There have since been seven Agreements. The Seventh International Cocoa Agreement, negotiated in 2010 in Geneva, came into force provisionally in October 2012.
On 19 September 2012, the Governments of six producing countries, accounting for 43.17% of votes as set out in Annex A to the Agreement, and the Governments of consuming countries comprising the European Union and Switzerland accounting for 54.90% of votes, as set out in Annex B to the Agreement, had deposited their instruments of ratification, acceptance, approval or accession or had notified the depostiary that they would apply the Agreement provisionally when it entered into force. The Governments decided to put the International Cocoa Agreement 2010 into force provisionally among themselves in whole as of 1 October 2012.
The two most important breakthroughs of the present International Cocoa Agreement were the establishment of an explicit mandate on a Sustainable World Cocoa Economy and the founding of the Consultative Board on the World Cocoa Economy.
The Consultative Board consists of international experts in the cocoa sector, from the private sector and from civil society (from both cocoa producing Member countries and from cocoa consuming Member countries). However, the Board, whose mandate is as extensive as that of the International Cocoa Council and comprises all aspects of the world cocoa economy, only functions in an advisory capacity, as all final decisions are taken by the International Cocoa Council. The Consultative Board was established in recognition of the importance of the private sector in the world cocoa economy and of the increasingly important role that trade and industry have been playing in ICCO.
The mandate of the International Cocoa Organization is to work towards a sustainable world cocoa economy. The concept of "sustainability" encompasses social, economic and environmental dimensions in both production and consumption. This includes work on customs tariffs on cocoa bean imports, cocoa semi-products and chocolate; (indirect) taxes related to cocoa consumption and processing; production costs in different countries and regions; market information for cocoa farmers; and Price Risk Management for farmers through co-operatives.
Remunerative prices and higher incomes for cocoa farmers are an essential element within the context of sustainability, as, without this, meaningful sustainability cannot be achieved.
Market transparency has been a vital concern for the ICCO for more than 30 years. It is indispensable for the efficient functioning of the world cocoa market, mitigating price fluctuations, optimizing decisions by all market participants and improving the incomes of small cocoa farmers. Since its establishment in 1973, one of ICCO's major activities in this area has been the collection, processing and publication of cocoa statistics (production, prices, stocks, consumption, etc.). The Quarterly Bulletin of Cocoa Statistics produced by ICCO is the most authoritative source of cocoa statistics in the world.
ICCO's work, related to sustainable cocoa production and consumption, includes: the co-ordination and rationalization of production policies and programmes of cocoa producing countries, the improvement of knowledge available on cocoa resources in producing countries, the compilation of an inventory on the health and nutritional attributes of cocoa and chocolate and the generic promotion of cocoa and chocolate consumption in emerging markets.
During the past decade, ICCO has initiated and supervised a number of projects in the cocoa sector with emphasis on the development of cocoa production and trade, as well as on the improvement of the income position of smallholder cocoa farmers. The Common Fund for Commodities (CFC) has been the major source of external financing for these projects. Over the years, the CFC has provided financing for a variety of projects, including: the Utilization and Conservation of Cocoa Germplasm, the development of molecular markers to fight Witches' Broom Disease of cocoa, the distinction between Fine and Bulk cocoa, the Generic Promotion of Cocoa Consumption in Japan, the Improvement of Cocoa Marketing and Trade and the use of Cocoa By-products.
Projects developed and under development since the implementation of the Sixth International Cocoa Agreement address explicitly the objective of achieving a sustainable world cocoa economy. For example, a "Total Quality" project has been devised to improve the cocoa supply chain and achieve traceability back to the village level. A project proposal has also been developed on cocoa-based agro-forestry in Latin America, building on an existing traditional extensive cocoa cultivation system, the so called "Cacau Cabruca System". A successor project to the cocoa germplasm project has been developed, aiming at the selection and distribution of improved planting material. Recently, a pilot project was initiated to introduce Price Risk Management for cocoa farmers through co-operatives.
To complement its mandate of working towards a sustainable world cocoa economy, ICCO also functions as a centre to address matters of importance in the world cocoa economy in conjunction with governments and the private sector. These include the use of food grade jute bags, the presence of Ochratoxin A in cocoa, issues involving the worst cases of the use of child labour and maximum residue levels for pesticides.