Development of novel value chain from cocoa pod husks in Indonesia: Technological, environmental and socio-economic challenges of a value chain

Indonesia is the world's 3rd largest cocoa producer, producing around 400,000 tonnes pa of cocoa, primarily in small family farms, and this industry contributes ~14% to GDP. Cocoa farming is the main source of income for more than one million smallholder farmers and their families, therefore the economic and environmental sustainability of cocoa production is key for the long-term social and economic stability of farming communities. The sector though is facing significant technical and business challenges which lead to low farming productivities and consequently to low profitability for farmers. Despite a number of public-private initiatives over the last 8 years, significant changes are still needed to improve the sustainability of cocoa production and have an impact on farmers' welfare and economic stability. These include implementing best-known farming practices (e.g. efficient use of fertilisers and pesticides), developing approaches for the exploitation of by-products, improving post-harvesting techniques for cocoa beans, improving infrastructure and transportation, developing education and training programmes for farmers and promoting the development of farmers' co-operatives.

The commercial exploitation of cocoa pod husks through their conversion to added-value products, such as biomaterials for food and non-food uses, is a promising strategy and a timely opportunity to address effectively and efficiently some of the sustainability issues of cocoa production. This is high up on the R&D agenda of our industrial partner (Mars Chocolate Ltd) and Indonesian government agencies. Currently, most farmers, after extracting the beans, leave the pod husks on cocoa plantations. This can return some nutrients to the soil (in the absence of any other fertiliser being used), but untreated pod husks can lead to increased pest and disease pressure from cocoa pod borer moth and black pod disease, thus decreasing the productivity of the farms. The aim of the project is to develop a novel value chain for cocoa pod husks which upon implementation will have an impact on the economic stability and welfare of cocoa farmers. The specific objectives are to: (i) elicit the willingness of farmers in Indonesia to adopt the proposed practice changes and assess how these might be aligned with farmers' preferences; (ii) develop scalable process designs for the efficient fractionation of cocoa pod husks into non-soluble fibre, soluble fibre and lignin fractions; (iii) identify and evaluate value-adding applications for such fractions with market potential within the food and non-food sectors; (iv) understand the potential impacts on soil properties and soil nutrient cycling of off-farm removal of husks; and (v) propose a supply chain based on scale and mode of operations (e.g. centralised or decentralised) and evaluate the economic viability from a farmer's and private sector perspective.

Developing a new value chain based on the use of cocoa pod husks husks will minimise potentially negative environmental effects associated with their disposal and diversify the activities of farmers through the collection, primary processing and transportation of the husks. All these changes will considerably improve the sustainability of cocoa production. This can potentially have significant impact on the farmers' economic stability and welfare through increased household income, incorporation of modern and sustainable farming practices, public-private investments in infrastructure, manufacturing operations and transportation, introduction to new technologies, development of new skill sets, creation of jobs and entrepreneurial opportunities. The project's outcomes will make a strong case for use of the novel value chain and identify the socio-economic and technological challenges (e.g. adoption of new farming practices by farmers, process efficiency and scalability) and opportunities as well as the risks for its successful implementation.

The project will take an integrative approach to identify and address holistically the technological, environmental, economic and societal challenges of developing a novel value chain for cocoa pod husks. This is important as it will ensure that the strategies in this value chain are viable for use in Indonesia and have a positive impact on the welfare and economic stability of the farmers, as well as the environment.

The project will explore three alternative protocols, organosolv processing, alkaline extraction and steam explosion, to identify an efficient and scalable process for the fractionation of cocoa pod husks into soluble fibre, insoluble fibre and lignin. The fibre-rich husk fractions will be added into different food systems (bakery, dairy, chocolate-based confectionary products) to reduce their sugar and fat content and increase their fibre content, and will also be investigated as a filler to improve the physicochemical properties of biodegradable foam packaging materials. The willingness of Indonesian farmers to adopt the proposed practice changes (e.g., additional labour for the collection, storage and transport of husks, changes in farming practices associated with the new mode of husk utilisation) will be assessed by a preliminary survey, and subsequently by a choice experiment to evaluate how these changes might be aligned with farmers' preferences. Studies will also be conducted to understand the potential impacts of the off-farm removal of husks on soil properties and soil nutrient cycling. The outputs from the individual work packages will be integrated to develop alternative flow designs for a novel value chain based on different scenarios (e.g. location and scale of operations, changes in farming practices, infrastructure needs). The economic viability of the whole value chain will be assessed from a farmers' perspective and from the perspective of a commercial operation using cost-benefit analysis techniques.

The implementation of a novel value chain for cocoa pod husks will have considerable social, economic and environmental impact which will benefit a number of stakeholders, including the Indonesian cocoa farmers and the cocoa sector as a whole, the Indonesian food and packaging industry and the general public.

The new value chain will have significant impact on the farmers' economic stability and welfare through increased household income (as a result of the collection, storage and transport of the husks to the manufacturing facility), introduction to new technologies, development of new skill sets, promotion of farmers' cooperatives, creation of jobs and entrepreneurial opportunities. Moreover, it will provide an understanding of the environmental impact that the current uses (non-standardised application of non-composted husks to soil) and proposed uses (collection of husks) have on soil quality and nutrient cycling, and propose suitable alternative strategies (e.g. through addition of inorganic fertilisers, composted materials or re-introduction of husk-derived fractions to soil). These will be used to design a viable novel value chain for cocoa pod husks that is based on good farming practices and has minimum impact to the environment. The project outputs will form the basis for: (i) stimulating collaborative activities between stakeholders involved in the project (Indonesian farmers, Indonesian Agency for Agricultural Research and Development of the Ministry of Agriculture, Indonesian Coffee and Cocoa Research Institute, Mars Chocolate Ltd) and beyond (e.g. Indonesian food and packaging SMEs, the public-private Cocoa Sustainability Partnership forum), (ii) designing viable commercialisation plans, and (iii) attracting public-industry investment for improvements in infrastructure and for new manufacturing facilities. These impacts will considerably improve the economic and environmental sustainability of cocoa production, which is key for the long-term social and economic stability of the Indonesian farming communities.

The Indonesian cocoa industry will benefit through the commercial exploitation of an underexplored natural resource (cocoa pod husks), which at the moment have low value. This will be driven by the extraction of added value components (e.g. dietary fibre, biomaterials, lignin) with considerable market opportunities within the food, packaging and chemical sectors. Besides the potential global impact, commercialisation of these husk derived products will particularly have an impact on the Indonesian food and packaging sectors which have been experiencing significant growth in the last few years. Within the Indonesian food sector, this will be materialised through the development of healthier food products (e.g. ice cream), containing fibre extracted from cocoa pod husks, that have a lower sugar/fat content and a higher fibre content. This is a global priority for food manufacturers and a significant growth area driven by the need to address concerns by health authorities and consumers, and potentially reduce the risk of obesity and cardiovascular diseases. Within the Indonesian packaging sector, this will be materialised through the use of husk derived fibre components as biomaterials for the production of starch-based biodegradable foam packaging materials. These materials are used as alternatives to styrofoam packaging materials; the latter use harsh chemicals for their production, such as styrene and benzene. The above impacts will result in an improvement in the quality of life and the health of the general public through: (i) the development of functional ingredients that can be incorporated into food products, (ii) the reduction in our dependence on petrochemicals and (iii) the reduction in pollution from chemical synthesis of plastics.