On the logistics of cocoa supply chain in Côte d’Ivoire: Simulation-based analysis

Côte d’Ivoire produces about 42 percent of the world’s total Cocoa but processes only 30 percent of the total production. A large part of the country depends on the commercial benefits of the Cocoa production and supply chain of it. In this paper, we develop a simulation model that assess the performance of the logistics of the Cocoa supply chain in Côte d’Ivoire. The simulation model shed light on the potential of improvements in the logistics of the Cocoa supply chain by identifying inefficiencies, bottlenecks, and blockers that hinder the productivity and performance of the Cocoa supply chain. Results from simulations show that reduction of checkpoints along<br/>the roads will increase productivity by 30 percent, while the value of beans in the Port will increase 3 percent and of butter 5 percent. Investing in improving secondary and tertiary roads will increase the productivity by 9 percent and value by 1 percent while investing in improving road infrastructure and checkpoints will raise the productivity by 27 percent and the value by 3 percent. The results suggest that a combination of reducing the checkpoints with the investment in secondary and tertiary roads will increase productivity while at the same time the pollution will be reduced importantly. The results also suggest that the switching from only producing beans to butter should be accompanied with the increase in productivity otherwise the value at the market would not be sensitive. Other important results are also presented in this paper, together with suggestions for improvement in order to optimize the logistics of Cocoa supply chain, and increase the profitability of the Cocoa sector, and hence the living conditions and wellbeing of the farmers in the country.

Côte d’Ivoire covers an area of 322,463 km², of which 48.2 percent is rainforest zone and 51.8 percent is dry forest savannah zone. The country’s tropical climate makes it one of the most suitable places on earth for the cultivation of Cocoa.

Agriculture provides a living income for 53.6 percent of the population and accounts for more than half of export earnings. There are some 1.4 million farmers who gain their living income from the cultivation of coffee and Cocoa, and more than 6 million people that have income that is directly or indirectly related to the Cocoa sector (about one-quarter of the total population).

The great majority of Cocoa farmers own small land plots of approximately 2–5 ha. They are scattered across 8112 villages and 6068 hamlets and settlements across the country. Most of the smallholders in the Cocoa sector face several social and economic challenges, such as low revenues, high costs of farming, little or no savings, lack of capital, low investments, high poverty levels, health risks, social exclusion, among others. It is argued that this situation is the result of the falling prices of Cocoa which lead to poverty traps and stagnation in the Cocoa’s producing countries, because the reduction of incomes push the farmers to reduce inputs and save on costs of production, which in turn, result into low yields, low revenues, low investments in improving Cocoa production, increase vulnerability of Cocoa trees to pests and diseases, and hence an increase in poverty and impoverishment of Cocoa farmers.