United Cacao defends farming practices after press attack

Peruvian cocoa farming company United Cacao was forced to respond to accusations of illegal deforestation on Thursday, working to assure investors it operates in compliance with local and environmental laws.

The AIM-traded firm was in the firing line overnight, when a delegation of leaders from indigenous and forest communities in Peru joined with non-government organisations in calls for it to be suspended from trading.

They claimed links between financing raised on AIM, and the illegal deforestation of at least 11,100 hectares in the Peruvian Amazon by United Cacao’s direct subsidiary Cacao del Peru Norte and two related companies - Plantaciones de Pucallpa and Plantaciones de Ucayali.

“The illegalities, abuses, and forest destruction perpetrated by Dennis Melka’s companies in the Peruvian Amazon have been public for years now,” said Julia Urrunaga, Peru programme director for the Environmental Investigation Agency.

“In spite of the Peruvian government having ordered the companies to stop operations and comply with the law, they continue to systematically violate Peruvian laws and ignore the Peruvian authorities.”

Thursday’s update from United Cacao pointed to a January ruling from the Federal Supreme Court of Peru, which reaffirmed the Loreto Superior Court of Appeals ruling of 26 March 2015.

That ruling originally confirmed the company’s environmental permitting and agricultural zoning since 1997.

“Further to this the company submitted its terms of reference for the environmental reporting documentation, known locally as a PAMA,” United Cacao’s board went on to say.

“The authorities requested that the company submit a PAMA due to the ongoing nature of agricultural activities on its land. Since that time the authorities have not issued documentation changing this position nor requesting an alternative environmental certification,” it added.

United Cacao said its terms of reference for the PAMA were approved by the authorities on 9 October 2013, and as part of those terms its community participation plan was submitted on 4 September 2014 and subsequently approved.

“Final approval of the PAMA is expected during the course of 2016. Further announcements will be made in due course, as appropriate.”