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News / Comment

17NOV
2016
NEWS / World's largest chocolate company invests in climate risk management
Category: Agribusiness & Forestry, Latest News, Retail & Supply Chains

Image: Mars Chocolates control many well known brands, including Twix, Snickers, M&M's and Galaxy. CC0 Public Domain
 

Climate change poses a threat to many global food commodities, with crops such as coffee, rice and cereals all affected by extreme weather events and shifting growing seasons. In what is worrying news for chocoholics everywhere, cocoa is another crop that is highly climate sensitive - posing a threat to the world’s US$ 100 billion chocolate industry. It is a threat that the world’s largest chocolate maker, Mars Chocolate, is taking very seriously, investing heavily in order to ensure a resilient supply, which could give them the edge over competitors.

Mars, makers of the famous Mars Bar, but also of other confectionary brands including M&M and Snickers, is event employing its own climate scientists and meteorologists to help them better understand climatic impacts on their business.

In an interview with Business Insider Magazine, Katie Johnson, a senior manager on the commercial applied research team, expressed concern that “if climate conditions in these growing areas begin to change over time, it may influence both the supply and quality available of an ingredient that we use in our products.”

Weather patterns are very important to Mars. The company’s meteorologists analyse global weather in order to predict where to expect the best yields, and the best quality of their core ingredients. These ingredients extend beyond cocoa beans for chocolate making. Nuts such as peanuts and almonds for example, are widely used by the company in its products. 

Being able to predict the quality and yield of these crops allows Mars to plan for possible shortages and make contingency arrangements. However, the short-term weather analysis, is becoming increasingly difficult thanks to climate change. This is because climate change is making local weather patterns far less predictable, increasing the uncertainty for Mars, and therefore making their business more risky.

In the short-term climate change is likely to continue to be a headache for the chocolate industry, making weather forecasting less predictable and increase supply chain insecurity. However in the medium term, climate impacts could pose a far greater threat to the industry. 

Cocoa farmers face rising threats from extreme weather events and crop disease, while ‘slow onset’ changes like gradually increasing temperatures are making traditional areas of cocoa production less suitable. For Mars, understanding and planning for climate risks is about more than being a responsible company from an environmental and social perspective; it simply makes business sense. 

 

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