The Ethical Cocoa Food Bank Support Programme

TRADE GATEWAYS  have created the Ethical Cocoa programme to support Food Banks from Cocoa sales.

This also features a Tokenization Platform which enables Cocoa and Cocoa Farms  to be tokenized and sold. 

Support via Cocoa Farm Purchase

Under this Support programme, purchasers would purchase Ethical Cocoa Tokens in batches of one hectare (2 and a half acres) of cocoa farms, to be managed by FADU. 

Each hectare provides one tonne of cocoa. The Cocoa  Farm would be fully owned by the Buyer. However, the Buyer would be able to donate some of the accruing cocoa sales to the related Food Bank. 

The current cocoa farm batches offered  are in Ijebu-Igbo.

How does a Tokenization Platform work?

Asset tokenization platforms enable  the creation of a digital proof of ownership for real-world liquid assets.

These asset-backed tokens have real-world capital and liquid value. Digital assets offer a flexible system for managing  digital assets and facilitating transactions. Once assets are tokenized, they can be used for transactions globally across borders.

The Cocoa Farms as Going Concerns

Most investments are valued based on their ability to provide returns to the investor and/or the likelihood of being worth more at a later date. Farmland has historically provided both (in a very stable manner ) for investors.

Income produced on the property is the most important factor for a farm investment. After cultivation of the cocoa farms, they will have going concern value.

The purchaser does not need any farming knowledge or to be present at the farm as the farm will be fully managed for them by FADU. In return they will pay FADU a management fee of around 10%

It can be seen from the cultivation schedule that that the annual ongoing costs for a one hectare farm of cocoa are about 110,000 naira. One hectare of cocoa farm produces about 1 tonne of cocoa. The international price of cocoa is currently about $10,000 per tonne or about 11 million naira

As such, after paying annual cultivation costs and FADU management costs, the purchaser can expect a future net return of about 10 million naira per annum per hectare from the cocoa farm.

Let’s assume a typical investor would want to make at least 12% per annum. As the farms batches would give a gross return of around 800%, it can be seen that these are very good investments indeed.  Additional to this is ongoing net annual revenue of around 10 million naira. All management by FADU.

The price of cocoa in the world markets could be reasonably expected to increase in the future giving the purchaser both increased revenue and an increased valuation for the farm