Global Warming… Now Effecting Mars
Global warming’s impact to agriculture will have a tremendous impact to the chocolate and candy industries
Many may argue that the most important commodity on Earth is chocolate. Mars Candy is one of the world leaders in the candy industry, with sales estimated at $33B for 2015[i]. With brands like 3 Musketeers®, Dove®, Milky Way®, Twix®, Snickers®, and M&Ms®, Mars relies on the successful production of cocoa beans to produce their chocolate. Cocoa bean production has historically been dominated by the Cote d’Ivoire (Ivory Coast), which produces more than twice the amount of cocoa beans per year than the world’s second largest producer.[ii]
Cacao is very delicate crop. It must be grown within 20° of the equator, in areas with “high temperatures, high humidity, abundant rain, nitrogen-rich soil, and protection from rind. In short, cacao trees thrive in rainforests.”[iii] Due to global warming and rising temperatures, cacao tree crops will likely need to be moved in Cote d’Ivoire from 350-800 ft to 1,500-1,600 ft above sea level in order to counteract the impacts of changing precipitation patterns which in-turn effect the necessary humidity levels to grow cacao trees. A recent study found that this change in cultivation area will negatively impact the production of cacao, as 89.5% of locations studied as possibilities for new growth were likely to have a decrease in suitability for cacao production by 2050.[iii] As the Chief Sustainability Officer for Mars has said, “most of the models will say that it’s going to get drier in West Africa, and that’s not good for cocoa.”[iv]
Beyond, just chocolate, Mars recognizes the risk that global warming can play on their entire supply chain. Due to recent droughts and increasing temperatures in California, the production of almonds has been greatly impacted, which can have downstream impacts to major Mars brands including, Snickers®. As the temperatures rise, the chill levels needed to support the growth of almonds may be put in jeopardy.[v] To help curb the potential risk to their supply chain, Mars has started to work very closely with meteorologists to help predict future impacts to supply. Using these meteorological models, Mars will be able to better predict its eventual supply needs, and therefore will be able to better determine future products and supply.[vi]
Rather than looking elsewhere for their production of cacao trees, Mars has made a concerted effort to help the suffering farmers of Cote d’Ivoire. This involves working with farmers to provide superior types of trees, fertilizer, and training. Beyond just supporting their farmers, the executives at Mars recognize that global warming is a problem that needs their corporate support as well, leading Mars to invest in a 211-megawatt wind farm in Texas, which produces enough electricity used by its US operations.[vii]
Furthermore, Mars recently partnered with 9 other global food companies (including: General Mills, Unilever, and Nestle) to lead an effort to reduce the worlds reliance on fossil fuels and reduce the impact of global warming. Mars, along with these other companies, has set a goal to remove the use of fossil fuels from their production system completely by 2040.[vii] Over the course of 2015, Mars made a number of improvements to help meet their 2040 goal. Mars had a very successful 2015 as it was able to reduce its greenhouse gas emissions by 25% in (primarily due to their wind farm in Texas) and reduce its fossil fuel use by 18.1%, just missing their goal of 25%. Mars, both domestically and abroad, is making a concerted effort to move towards renewable energy, including: the use of thermal springs in Hungary, treating wastewater anaerobically (to produce biogas as a form of renewable energy) in Poland and the Czech Republic, and using solar gardens in Nevada.[viii]
From the coast of California to the Ivory Coast, global warming is having a serious impact on Mars’ supply chain and products. One day, chocolate may not be a special treat, but more of an expensive luxury.
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Sources:
[i]Mars Inc. is a private company. Revenue estimates are sourced from Forbes magazine estimates. “America’s Largest Companies.” Forbes Magazine, www.forbes.com/companies/mars/.
[ii] “FAOSTAT.” FAOSTAT, Food and Agriculture Organization of the United Nations, Statistics Division, faostat3.fao.org/browse/q/qc/e.
[iii] Scott, Michon. “Climate &Amp; Chocolate.” National Oceanic and Atmospheric Administration. Agency of the U.S. Department of Commerce, www.climate.gov/news-features/climate-and/climate-chocolate.
[iv] Charles, Dan. “As Big Food Feels Threat Of Climate Change, Companies Speak Up.” NPR, www.npr.org/sections/thesalt/2015/12/01/456369536/as-big-food-feels-threat-of-climate-change-companies-spe
[v] “Global Warming, Impact On Agriculture And Adaptation Strategy.” www.ucsusa.org/sites/default/files/legacy/assets/documents/global_warming/ucs-ca-agriculture2.pdf.
[vi] Taylor, Kate. “The Smart Reason the World’s Largest Candy Maker Is Hiring Meteorologists.” Business Insider, Inc, www.businessinsider.com/mars-chocolate-hires-meteorologists-to-deal-with-climate-change-2016-9.
[vii] “MARS UNITES WITH GLOBAL FOOD COMPANIES ON CLIMATE ACTION: ‘WE CAN AND MUST DO MORE.’” Mars, Incorporated, www.mars.com/global/press-center/newsroom/mars-unites-with-global-food-companies-on-climate-action-we-can–and-must-do-m
[viii] “Improving Energy And Climate.” Mars, Incorporated, www.marsgcc.com/global/sustainability/operations/energy-climate.
The thought of not being able to afford chocolate everyday is horrendous.
This is a great example where going for sustainability is actually really crucial for cost control. I’m glad to see a partnership among food giants to alleviate the issue of climate change. Though I am curious to see how mars is trying to save the cacao supply from global warming with short-mid term solutions. One solution I can think of is to be more creative with product development and marketing to increase the mix of non-chocolate products or sell more products that has less %composition of chocolate. Mars has a pretty diversified product portfolio and I think they will not be too severely impacted by this situation as they have room to maneuver. Confectionary companies that are more susceptible to this issue are ones highly reliant on chocolate itself such as Lindt and Ritter Sport. I hope the best for them.
This is a really interesting illustration of how climate change affects agriculture (cacao production) and in turn, incentivizes corporations (like confectionery companies) to focus its efforts on increasing renewables usage and helping to support local farmers. While I’m glad to hear that Mars, and several other food companies, have committed to reducing reliance on fossil fuels, an area that concerns me is the negative impacts of climate change on regional agriculture and farming, such as Cote D’Ivoire’s ability to produce cacao in the future. There is a related article in Scientific American that discusses climate change’s impact on cacao production (https://www.scientificamerican.com/article/hit-by-climate-change-central-american-coffee-growers-get-a-taste-for-cocoa1/), and what I found particularly interesting in the article is that, while climate change negatively impacts cacao production in certain areas like Cote D’Ivoire, other regions, such as Central American countries (ex: El Salvador), may actually benefit from the changing climate in terms of cacao cultivation. This makes me wonder if 1) Mars (and other confectionery companies) will be able to continue chocolate/candy production through different agricultural sourcing, but at the same time 2) continue to support local farmers in Cote D’Ivoire by helping them identify other crops (that Mars may need to use) to pivot towards as climate change continues to impact the agricultural landscape.
I find Mary’s comment really enlightening. While I certainly appreciate the efforts Mars is taking, such as helping farmers increase productivity from existing cacao trees, it is impossible to deny the very painful truth that eventually cocoa trees will no longer grow in what is currently the “cocoa belt”. Therefore, don’t you think Mars needs to “think outside the box” and either consider gradually moving production to other areas that are expected to benefit from climate change, such as Central America, or find substitutes for their raw inputs?
No, not chocolate. No. Why??? This might be the best reason to take immediate action on climate change that I have ever heard.
I am so glad to hear that Mars is really doing something to prevent the disaster that would be losing chocolate instead of just paying lip service to the problem. The areas from which they source their raw goods are some of the least equipped to deal with the massive impact of climate change and I think it is great that Mars is trying to help them through that transition. It isn’t often that companies surprise you like this, especially major junk food manufacturers. Thanks so much for highlighting their good work.