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Moho River Cacao


Growing prosperous farming communities through meaningful market access
Our Missions Moho River Cacao is committed to three distinct organizational missions: social, environmental and product. These missions guide our day-to-day operations, and remind us why we do what we do. Page 2 Social Impact Read the results of our rst annual farmer survey, designed to better understand the people who produce our cacao. Page 3 Environmental Impact From providing organic certication free of charge to initiating ambitious seedling programs, MRC helps preserve Belizes natural resources and promote responsible land use. Page 4 Product Impact Customers & Partners MRCs customers and partners provide the resources and support necessary to overcome obstacles and get things done. Here we highlight several joint projects and initiatives from the 2012 season. Page 6 Centralized processing allows MRC to consistently produce high quality cacao. Page 5

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Issue #1 -- June 2012 Metrics Assessment Our evaluation of ten key performance metrics for the 2012 season. Page 7

Letter from the Director


The 2012 harvest season brought enormous growth to Moho River Cacao (MRC), as our processing volume shot up 300%. This number means much more than just a percentage. Heres a snapshot of what our growth means on the ground in Belize: Innovative extension services Our eld staff has been working with a steadily growing number of farmers, from 50 in 2011 to over 180 during the 2012 harvest season. Gabriel Pop, MRCs General Manager and strategic visionary since day one, has built new approaches to extension assistance, constantly rening outreach strategies to increase cacao production and farmer income. Emeterio Sho, our extensionist in San Jose, meets with farmers at their homes, visits their farms and listens to their feedback, building a network of supporters in the remote, high-producing villages of San Jose and San Antonio. Sebastian Mis, MRCs rst extensionist and one of our most productive cacao farmers, has forged new partnerships with conservation organizations to lead agroforestry trainings and has helped over 50 farmers directly on their farm. Each of these extension ofcers attended a comprehensive cacao management training at the Fundacin Hondurea de Investigacin Agrcola Moho River Cacao Annual Impact Report - 2012

(FHIA), as well as local trainings in composting and peer education. During the wet season, MRC has scheduled three additional trainings on nursery management, farm planning and tree pruning.

and communication through his role as administrator, ensuring that everyones voice is heard and that our inventory is fully tracked and traceable. Next to our processing facility, Galo Mejangre manages our nursery, keeping thousands of cacao seedlings alive and healthy through varying weather conditions and typical agricultural challenges. Commitment to transparency We have enormous thanks to give to Samantha Garwin, or as we all know her Super Sam. Originally hired to create a system for measuring and monitoring MRCs social and environmental impacts in the Toledo District, Sam also developed and implemented systems used by our processing team to manage and improve quality control, trained the team to execute the systems, and created the framework and gathered data points for this report. Our growth this year is not just a number: its people. As youll read in this report, we have an ambitious vision for the Belizean cacao industry and for the positive social and environmental impacts a vibrant cacao industry can bring to this beautiful and diverse country. Our extension team, processing team, and our increasing network of farmers in villages around southern Belize are all to thank and appreciate for their efforts toward catalyzing this vision. I cant wait to see whats in store next. -- Emily Stone, Managing Director

Moho River Cacaos new 20 x 80 drying deck tripled capacity this season, enabling the San Felipe facility to process up to 10,000 pounds of wet cacao per week.

Quality above all else At our processing facility, Toribio Cocs unwavering commitment to producing the worlds nest cacao beans has meant laboring though unbearable heat, week-long rainstorms, and all kinds of unexpected daily challenges. Rosaria Choc and Mercedes Ishim sort through hundreds of pounds of cacao beans daily, ensuring a consistent premium quality to all of our sacks of cacao, while also bagging up the beans, leading groups of tourists through our facility, and keeping the space tidy. Samuel Tzui, newest and youngest member of the team, has contributed immense improvements in organization

One company, three missions


Moho River Cacao sources the best cacao from smallholder Belizean farmers and uses tightly-controlled processes to create consistently exceptional beans for premium chocolate makers.
Social Mission
To grow prosperous farming communities by providing meaningful market access.

Environmental Mission
To prevent deforestation and encourage organic, sustainable agricultural practices.

Product Mission
To produce an increasing volume of the highest quality, organically farmed cacao.

As the homeland of the Maya, inventors and consumers of the worlds rst chocolate products, Belize has a special place in the cacao industry. Belizean farmers, the majority of which are traditional Kekchi or Mopan Maya, produce organic cacao from high-quality varieties including the rare white heirloom bean known as Criollo. MRC purchases cacao as fresh fruit in order to centrally process the product, providing farmers with increased security, more exibility with their time, and immediate compensation for their work. MRC offers the option of picking up cacao on the farm or at the farmers home, saving the farmer the time and expense of bringing the cacao into town. MRC is the rst and only entity to directly connect small family farmers in southern Belize with the premium chocolate market in the United States. The chocolate makers in this growing market deeply value cacao farmers, enabling MRC to achieve substantial social impact in Belize while growing a nancially sustainable organization. The business and social objectives of MRC are inextricably linked, as increased and improved cacao production in southern Belize is how we will achieve our business objectives as well as directly improve quality of life for cacao farmers in the region.

An astounding portion of Belizes land is protected in some way or another: 44%, according to the Biodiversity & Environmental Research Data System of Belize. Despite this, Belize is currently facing several major ecological threats, including industrialization of agricultural production through mono-crops such as oil palm and the discovery of crude oil in the southern region of Belize, where most of the countrys cacao is grown. As a shade crop, cacao prevents deforestation while providing a cash source for cacao-farming families. In Belize, cacao is grown organically and mostly in an agroforestry-based system, allowing for high biodiversity levels and income diversication for families. The Maya of Belize have been producing cacao for decades, but have historically had only one market option to sell their beans; the industry has never reached a nancially viable volume. The introduction of a competitive market for Belizean cacao brings new services, ideas, pricing models, and meaningful relationships to these farmers, catalyzing a renewed interest in cacao farming and a realistic vision of industry growth.

In addition to carrying some of the nest historical and ecological properties available in the cacao market today, cacao produced by southern Belizean farmers and processed by MRC staff carries a guarantee of superior quality due to MRCs method of centralized fermentation and drying. Operated entirely by Mayans, many of which are cacao farmers themselves and come from long familial histories entwined with cacao, MRCs processing facility ensures that every single batch of cacao receives personalized attention. Each batch of cacao is hand-selected at the farm, moved into the fermentation boxes manually and checked on at least once daily by MRC staff, and raked attentively in MRCs hand-crafted solar dryer three times a day by quality control specialists. After processing, the cacao is examined and sorted to ensure that only the highest-quality beans make it into our burlap sacks for exporting. The sacks are lined with hermetically-sealed Grain-Pro bags to prevent any contamination or outside interference with the cacao.

Moho River Cacao Annual Impact Report - 2012

Social impact
Grow prosperous farming communities by providing meaningful market access.
Moho River Cacao measures its social impact using both direct and indirect metrics. Cash paid directly to farmers is a direct metric because it is transparent. Moho River Cacao increased its price paid per pound of wet cacao this year from BZ $0.75 / US $0.38 per pound to BZ$0.85/US $0.43 per pound. The average amount of fresh wet cacao sold to MRC by individual farmers was 567 pounds, meaning that farmer income from cacao grew an average of BZ $56.70. For subsistence farmers, this is a small but meaningful increase that can be used to pay for a childs education, to invest in new tools for the farm, or to start saving for the future. In contrast, school attendance is considered an indirect metric because it is difcult to pinpoint the exact reason a child does or does not attend school. Although it is free to attend primary school in Belize, secondary school is not free, and often puts a signicant nancial burden on the family. There are additional fees if the child performs poorly, and for this reason it is common for a child to be removed from school if he or she has a single bad semester. Moho River Cacao holds an Annual Growers Meeting at the beginning of each production year with the goal of bringing together farmers and customers -- that is, premium chocolate makers -- to discuss the seasons goals and challenges. This year, registration for the AGM included the option to Moho River Cacao Annual Impact Report - 2012 complete a survey. The goal of this survey was to give Moho River Cacao a baseline on some of the indirect metrics, such as school attendance, that will be used to evaluate progress moving forward. Farmer gender

7%
Male Female

93%
Investment in childrens education

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School-age females attending school Primary ! Secondary

4% 57%
What follows are the results of this survey, a baseline for years to come. Going forward, our goals include: Increase the percentage of farms owned and operated by women Increase the percentage of children who attend secondary school, particularly females. Vital statistics Average age: 44 years Median age: 46 years Average # of children: 4 Median # of children: 3

43%

96%
Attending Not attending

School-age males attending school Primary ! Secondary

32% 68%
Attending

53%

47%

Not attending

Environmental impact
Prevent deforestation and encourage organic, sustainable agricultural practices.

Moho River Cacao has a four-pronged environmental strategy: organic certications, farmer trainings, tree planting and facilities and resource consumption. Outside of these focus areas, MRC works with NGO partners and the Belizean government to promote cacao as a priority cash crop for Belize, particularly as an alternative to less environmentally favorable crops such as African oil palm. MRCs efforts were publicly recognized in November 2011 through the appointment of MRCs Managing Director, Emily Stone, to the newlyformed Belize National Organic Council. Organic certications As part of its pre-season extension services, Moho River Cacao offers organic certications through IMO, the Institute of Market Ecology, free of charge to any cacao farmer in Belize. The certication process consists of a farm visit and thorough evaluations to ensure that no pesticides or herbicides are being used. In the 2011 season, Moho River Cacao certied organic 52 farmers in the Toledo District. In 2012 that number increased to 119 farmers in Toledo and south Stann Creek districts. This represents over a 200% year-over-year growth in the number of farmers certied organic and a nearly 95% growth in certied organic acreage under our certication program. This certication allowed Moho River Cacao to export up to 26 metric tons of certied organic cacao in the 2012 season, and is essential to securing the highest possible price from the world market.

combined, the projects will yield a total of 50,000 cacao trees to be planted during the months of July and August. These trees will be monitored to ensure their success in the 2013 season and beyond. Facilities and resource consumption Moho River Cacaos facilities consist of a small ofce in Punta Gorda Town and a processing facility in San Felipe Village. Fuel Vehicle fuel use is carefully recorded and monitored. Efforts are made to maximize efciency of all vehicle trips to minimize use of fuel. Materials With the exception of heavy duty greenhouse plastic used for drying deck roofs, all facilities were built using local materials. Water Rice sacks used to cover fermentation boxes are washed a maximum of once per week, and the gray water that results is used to water decorative plants around the processing facility. The company vehicle is washed a maximum of once per week. Waste Cacao shells and nibs discarded during the quality control process are either added to the nursery compost pile or used as mulch for decorative plants around the processing facility.

Oscar Zacarias, our certifying agent from IMO, talks with farmers about organic certication requirements. Oscar visits Belize from Guatemala once per season to certify Moho River Cacao farmers.

Tree planting As Phase 1 of an ambitious seedling project aimed at scaling the overall cacao production levels in Belize, MRC funded three nursery projects during the 2012 season. The rst project consisted of distributing 25,000 seedling bags to high-producing farmers to start their own farm-based nurseries. The second involved planting 5,000 seedlings in a small nursery located on the grounds of the San Felipe processing facility. For the third project, MRC partnered with a local non-prot conservation organization, Yaaxche Conservation Trust, to grow an additional 20,000 seedlings, some of which will be grafted. All

Moho River Cacao Annual Impact Report - 2012

Product impact
Produce an increasing volume of the highest quality, organically farmed cacao.

Moho River Cacao will be successful only if it is able to accomplish two things: increase the amount of cacao produced in Belize and guarantee customers a consistent, high quality product. The former is being addressed through a seedling program, discussed in more detail on the previous page; in 2012, MRC will distribute 50,000 young trees to be planted by farmers. The latter is addressed at MRCs centralized processing facility located in San Felipe Village, Toledo District. In the 2012 season the processing team focused on three main objectives: rst, develop standardized processes for achieving the desired level of of fermentation and drying in each and every batch. Second, track each batch from purchase to bagging, to allow for tighter quality control and sourcing transparency. And third, collect data and avor samples to better characterize the MRC product. Standardized processes The single most important processing step in developing chocolate avor is fermentation. MRCs fresh, wet cacao beans are picked up at the farm during the day and are allowed to drain of their juice throughout transportation to the processing facility. Beans are then loaded into the top level of a tiered fermentation box structure, where they are covered with rice sacks. The fermenting cacao is stirred or moved every 24 hours for 6-8 days. Since the time to achieve a particular fermentation level can vary based on ambient temperature, bean freshness or air ow, daily cut tests begin on the fth day of fermentation. When the desired Moho River Cacao Annual Impact Report - 2012

fermentation level is reached, beans are moved to the drying decks. On the drying decks, the cacao is raked three times per day to ensure even drying, develop avor and prevent mold from developing. Beans dry for an average of 7 days, after which they are hand sorted to remove any smalls, ats or miscellaneous organic matter. They are then stored in hermetically sealed GrainPro brand bags inside of thick burlap sacks; this helps maintain an appropriate level of moisture

purchase date, and this number accompanies the beans throughout fermentation, drying and bagging. Batch tracking allows MRC to know the conversion rate from wet seed weight to dry, bagged bean weight, as well ass how much fermented, dried cacao is currently in inventory. It also provides a framework for accountability: at any given time, the staff at the cacao house knows which batches are at what stage of processing. Data collection A nal focus of the 2012 season was to begin collecting data for each step of processing. Relevant data points include: How many days a batch was fermented or dried The temperature each fermentation box reaches at the warmest time of the day The percentage of Criollo beans in a batch Quality metrics such as the percentage of beans in a batch that are under-fermented or contain slate, mold or insect damage. With this data, MRC can answer important questions about processing: How are fermentation and drying rates affected by weather patterns? How does the number of days spent in fermentation boxes affect quality? Which farmers produce the highest percentage of Criollo varietal beans? Regularly gathering data also allows MRC to seamlessly experiment with new techniques and tools and quantitatively analyze the effects. 5

General Manager Gabriel Pop checks the temperature of a fermentation box.


and ensure that no insects or animals can access the beans. Batch tracking Cacao that enters the MRC processing facility on a particular day is considered to be a batch. Each batch is assigned a number corresponding to the

Customers & Partners

Taza Chocolate
Customer Taza Chocolate is a bean-to-bar chocolate maker located in Somerville, Massachusetts. Taza makes Mexican-style stone ground chocolate, which is minimally processed to ensure the maximum amount of avor in the nal product. Taza is the rst chocolate company in the United States to be certied Direct Trade by a third-party organization. Taza Chocolate has been an important supporter of Moho River Cacao since its inception, sharing deep knowledge about cacao processing and the craft chocolate market. Taza will be crafting its rst products with Moho River Cacaos beans in Fall 2012.

Sustainable Harvest International - Belize


Partner The mission of Sustainable Harvest International (SHI) is to provide farming families in Central America with the training and tools to preserve our planets tropical forests while overcoming poverty. Founded in 1997 by a returned Peace Corps volunteer, SHI addresses the tropical deforestation crisis in Central America by providing farmers with sustainable alternatives to slahsand-burn agriculture. Moho River Cacao has beneted from several trainings conducted by SHI eld staff, giving our extensionists a growing toolkit to bring new skills and farming methods to the farmers in our network. In addition, SHI is actively promoting cacao farming in communities around the Toledo and Stann Creek districts, assisting farmers with seedling nurseries and farm management resources. Their role actively contributes to catalyzing growth in the cacao industry across southern Belize.

Yaaxche Conservation Trust


Partner Ya'axch Conservation Trust is a Belizean organization that aims to maintain healthy forests, rivers and reefs for the benet of all. Through protected area management, advocacy, and working hand in hand with communities Ya'axch strives to develop capacity for the wise use of land and natural resources in and around the Maya Golden Landscape in the Toledo District. Yaaxche has served as a critical partner in agroforestry eldwork and strategic planning of cacao farm expansions. The central nursery at their Golden Stream Field Station is serving as an experimental nursery for 20,000 cacao seedlings grown for MRCs producers. Yaaxches eld staff have partnered with the MRC extension team for trainings on agroforestry farm management, and Yaaxches management has been an essential leader in pushing the sustainable agriculture agenda in the Toledo District of Belize.
Photo credit: Conor Hagen

Mast Brothers Chocolate


Customer Mast Brothers Chocolate is a family-owned bean-to-bar chocolate maker in Brooklyn, NY. In 2010 Mast Brothers turned heads by sourcing 20 metric tons of cacao from the Dominican Republic to the United States via sail freight. Mast Brothers was the rst to make a widelydistributed chocolate bar from Moho River Cacaos beans. Their Moho River bar uses 100% Belizean cacao, possibly the rst-ever chocolate bar made in the United States with exclusively Belizean cacao. 6

Mast Brother Michael Mast, farmer Armando Sam and Managing Director Emily Stone.
Moho River Cacao Annual Impact Report - 2012

2012 Key Performance Indicators


Each year, Moho River Cacao reviews its progress on ten mission-related metrics. Heres how we did this year, and our targets for next year.
Metric
Farming family income from MRC Children attending secondary school Woman operated farms Certied organic farmers Certied organic acreage Farmers trained in sustainable farming methods. Seedlings grown and distributed to farmers Tons of cacao produced annually Average fermentation level Incoming requests for product

Mission
Social Social Social Environmental Environmental Environmental Environmental Product Product Product

2012 Achievements
BZ $56.70 increase year-over-year 45% of secondary school-age children 7% of farmer base 119 farmers 318 acres 48 farmers 50,000 seedlings 20 metric tons 70% fermentation 6 chocolate companies

2013 Goal
BZ $70.00 increase year-over-year 50% of secondary school-age children 10% of farmer base 175 farmers 450 acres 150 farmers 50,000 seedlings 30 metric tons 80% fermentation 10 chocolate companies

Looking forward...
The 2013 harvest season is anticipated to bring an increase in production levels and a heightened excitement about the industry from both experienced and new cacao farmers. We look forward to assisting farmers in planting over 50,000 trees this summer and monitoring the growth of those trees. We foresee expanding into new territories, farther north in Belize, which have suitable land for cacao farms and Belizeans ready to take on the challenge and opportunity of growing cacao for premium chocolate makers. Our buying, extension, and processing teams will continue to work hard day after day providing the best possible farm services for our cacao producers and excellent quality for our chocolate maker customers. Were excited to work more closely with the government of Belize over the coming year to promote sustainable, organic agroforestry across the country and to make sure that cacao farming has a stable and visible place in that agenda. We believe there is enormous potential for the positive impacts of cacao farming to multiply and catalyze meaningful social and environmental improvements across the country. We are only one part of a growing and bustling network of players in the industry, and we look forward to working together over coming years to turn our shared vision of a booming Belizean cacao industry into a reality. Stay tuned!

Management Team
Emily Stone Managing Director Gabriel Pop General Manager Alex Whitmore Founder Jeff Pzena Founder
Supported in the 2012 season by: Deon Chavarria, Rosaria Choc, Samantha Garwin, Mercedes Ishim, Galo Mejangre, Sebastian Mis, Armando Sam, Elvin Sam, Emeterio Sho

Contact us
General inquiries: info@mohorivercacao.com BZ +001 301.662.3336 US +011 617.990.7430 Belize ofce: Prince St. and Jose Maria Nunez Punta Gorda Town Toledo District, Belize On the web: http://www.mohorivercacao.com facebook/mohocacao @mohorivercacao

Moho River Cacao Annual Impact Report - 2012