The tiny Himalayan kingdom of Bhutan seems an unlikely place to associate with Nutella. It’s more likely to conjure up images of craggy mountaintop monasteries and strings of prayer flags, or the fact it measures national happiness rather than the conventional measure of a country’s prosperity, GDP.
But that may all be about to change, as the first 100% foreign-owned company in Bhutan has spotted an opportunity for hazelnut production, the key ingredient in Nutella and Ferrero Rocher chocolates.
Teresa Law and Daniel Spitzer founded Mountain Hazelnuts back in 2008, shortly after Bhutan held its first democratic elections and was becoming open to the possibility of international investment. The pair had been working and living in Asia for more than 20 years and had fallen in love with the Himalayan region through Spitzer’s former company, which grew trees and produced sustainable wood products in rural China.
Over the past nine years, they have worked with thousands of families, monasteries, nunneries and schools in Bhutan to develop hazelnut orchards, distributing 7m trees. They’ve also guaranteed to buy the nuts at an agreed price, and give training in how to grow them.
Now, the first orchards are beginning to bear fruit: the couple and their impact investment partners hope to eventually produce 3% of the world’s total hazelnut crop, while creating a reliable income and new skills for Bhutan’s rural mountain communities.
For Ngawang Choden, a farmer in the eastern Mongar province of Bhutan, the best thing about growing hazelnuts is how little care they need.
“I want to give my children an easy income and I don’t want them to have to go through the difficult work that I had to do in my childhood,” she says. “The hazelnut tree does not need as much care as my other crops, so my children should be able to look after them without the backbreaking work.”
Hazelnuts only require pruning once a year, and watering during the winter, she says, so they add income without too much extra work. In addition to her cows and other crops, which include chillies, spinach and broccoli, Choden now has 1,300 hazelnut trees over three acres, and expects her first full harvest this year.
Choden is no stranger to hard work. From an early age she worked on the family farm by clearing jungle to grow vegetables, and she became the primary worker after her brother died and her father left them. As a result, school was never an option, and her biggest concern is that her daughters are able to study.
“I’ve put my daughters in school in Mongar, which is about an hour’s walk from my house. I believe that in this day and age education is vital, and I don’t want my children to lead the tough, laborious life I’ve led, so I let them focus on school and don’t let them work on the farm,” she says, adding that she spent her first earnings from hazelnuts on a laptop and a mobile phone, and has begun saving in case her oldest daughter doesn’t win a government scholarship for college.
“In the future, I hope to get to a point where my mother doesn’t have to work any more and both my children are educated through until college, and I hope to pay for this through my income from hazelnuts.”
As one of the first to try growing hazelnuts in her village, Choden has also been appointed community lead grower. “A lot of the farmers come to me for advice as they see my trees are growing well,” she says. “This responsibility has given me the confidence to be more involved in the community.”
But hazelnuts aren’t just a way of improving rural lives. In 2016, global exports were worth $1.9bn, according to the Food and Agriculture Organization, and the market is growing by about 6% a year, due to the use of the nuts in anything from spreads, coffee and cereal to dairy alternatives.
“I would say all nuts are lucrative at the moment,” says Jara Zicha, senior analyst at commodity research company, Mintec. “It’s just such a trendy commodity because of all the health benefits.”
Nutella’s owner, the Italian confectionary giant Ferrero, is the world’s largest buyer of hazelnuts, the majority of which are grown in Turkey. But a major frost in 2013 slashed Turkey’s harvest and sent prices soaring, prompting buyers to look for new sources. “There’s been a push for production increases since prices shot up a few years ago because of that,” says Zicha. “As a buyer you want to mitigate risk. Relying on one supplier is never good.”
With ideal conditions for production, Bhutan may become an important source of hazelnut production, and while orchards won’t fully mature for another couple of years, Mountain Hazelnuts is already well established as the country’s biggest private sector employer.
The company employs 800 people directly and says it supports a further 1,200 through buying goods and services. “A hazelnut tree has a lifespan of 50 years. I may not live to see that, but I am already seeing some of the impact,” says co-founder Law. “One example is the number of services that are coming to east Bhutan, such as a bank branch, new housing and businesses, and the farmers’ market that has sprung up in the community.”
It’s this expansion of services that could be the real benefit from hazelnut production in Bhutan, according to Cecilia Tacoli, principal researcher at the International Institute for Environment and Development.
“It’s not about rural versus urban,” she says. “Everything in rural society revolves around large towns where there might be a local health centre and a set of services. You need services that are ‘urban’ but they don’t necessarily have to be in a big city.”
While a new potential source for Nutella might be welcome news to fans of the chocolate spread around the world, in Bhutan, hazelnuts could have an altogether more long-term impact.
