Just a couple of years ago Youxing He was a relative unknown to his fellow villagers in Mao County, Sichuan Province. That changed when, in 2008, he secured a 3 million yuan (approximately $443,675) deal to sell Sichuan pepper to European retail giant Carrefour.

Women from Qiang minority group in Mao County of Sichuan province harvest pepper. [WWF]

The deal, made possible through a groundbreaking project initiated by the Chengdu office of WWF-China, quickly attracted the attention of local pepper growers.

Of particular interest to the growers was that they could earn 6 yuan above the average market price per kilogram by selling to Mr. He. Once word got around that He had distributed 80,000 yuan of his profits to the 318 members of his cooperative, interest piqued even further. In 2009, the number of growers wishing to join He’s cooperative had almost doubled.

The problem

Mao County – an area encompassing panda habitat – is renowned for its production of high quality Sichuan pepper, one of the most important condiments in traditional Chinese cooking and a key ingredient in the Sichuanese version of hot pot.

For local villagers, the sale of Sichuan pepper has long been a primary source of income. Unfortunately, this income has historically been limited by a sales structure that included middlemen who skimmed off a large portion of the profits. In order to supplement their incomes, farmers went to the forest to chop firewood and collect medicinal plants and wild vegetables.

With the giant panda population in steep decline in the biodiversity-rich Upper Yangtze region, the Chinese government and conservation organizations took various measures to protect great tracts of panda habitats. Yet the downside was obvious. The forests were now off limits to local people who previously relied on them for their livelihoods. Suddenly, pursuing economic opportunity meant criminal activity.

WWF understands that for biodiversity protection initiatives to succeed, the well-being of communities who rely on their environment for income and survival must be considered. We knew there had to be a middle way.

Bridging the producer-buyer gap

Pandas and their habitats enjoy greater protection, now that farmers are able to earn decent income. [WWF]

In 2005, a village leader asked He to form a Pepper Association. By holding training sessions on good planting practices and by taking on the role of middleman to negotiate pepper sales at normal market prices, the association aimed to produce sustainably grown Sichuan pepper and help pepper growers keep a greater portion of the profits.

The first two years were extremely difficult. He spent all his life savings in his search for potential buyers. He and his association members attended almost every food and agricultural product expo throughout the country, but they were never able to sell quite enough. Without securing long-term and stable orders, He found it hard to attract pepper growers to sell their produce to the association.

The situation didn’t change until WWF-China selected the association as a partner in its Alternative Livelihood Project and introduced them to Carrefour, the second-largest retailer in the world.

According to Carrefour’s policy, payments are made two months after a purchase is made. In 2007, in order to help the cash-stricken pepper association, WWF’s project manager Ye Li persuaded Carrefour to pay half of its payment in advance.

That year, the pepper association sold about 13 tonnes of pepper to the supermarket giant. It was an amazing success. In 2008, WWF decided to help He upgrade the association to a cooperative, a relatively new concept in China back then.

Thus, the Sichuan Mao County Pepper Cooperative was born. In its first year, the cooperative inked a 3 million yuan deal with Carrefour. Since 2010, the pepper from the region has become part of Carrefour’s direct purchasing system, one of the biggest projects of Carrefour China to help farmers improve their incomes, and enhance the freshness and traceability of its products.

The cooperative has sold its pepper to more than 116 Carrefour stores in 32 cities around China.

A model for sustainable development

WWF volunteers from Sichuan province promote sustainably grown pepper in Carrefour. [WWF]

To date, the cooperative has sold more than 90 tonnes of pepper to Carrefour, benefiting more than 1,300 families in Mao County. On average, each family’s income has increased about 500 yuan annually, which is 20% of their annual cash income. The Mao County residents no longer need to worry about where and how to sell their pepper.

Yet He thinks even bigger. “Our goal is to sell our pepper to every Carrefour supermarket in the world,” he said during an event organized by WWF-China at Shanghai World Expo.

WWF’s pepper project is a new model for sustainable development in a biodiversity-rich landscape. It is also an example of the implementation of a good government policy that is supported farmers, community organizations and companies.

“Our customers can buy good quality products and at the same time, we contribute to the panda protection. Carrefour’s brand is enhanced. It’s not a win-win project. It’s a win-win-win-win-win project – Carrefour, nature, customers, farmers and WWF,” said Jerome Chevrier, general manager of Carrefour China's north and west regions.

The success of the project has important benefits for both people and nature. The farmer’s income security ensures the long-term protection of the nearby giant panda nature reserves. Innovative farming practices ensure sustainability so that the natural resources of the region will not be overexploited. Through WWF’s holistic approach, people feel a spirit of optimism and cooperation, and the nearby panda populations have their best chance of survival.