Easter 2015 may be remembered as the end of the cheap chocolate era: cocoa
prices are expected to double by 2020 as the world’s cocoa supplies run low.
According to David Guest, professor of plant pathology at the University of
Sydney, the cost surge is inevitable. The squeeze is partly a result of farmers
moving into higher-return crops such as coffee and maize, which are less
susceptible to pests and diseases, but it is also linked to problems around the
labour-intensive cultivation of cocoa trees.
“It takes about three years after you plant a tree to start harvesting,” said
Guest. “You need to look after these trees properly, which requires labour. And
labour shortages are a real problem in the cocoa-growing areas because of a
drift of young people to the cities and people suffering from poor health.”
Another factor, says Guest, is that around 70% of cocoa beans come from west
Africa, which has seen major political and social upheaval over the past couple
of decades.
Demand is also growing rapidly in places that have not previously consumed a
lot of chocolate – particularly China and India. In Asia, demand is now rising
almost seven times faster than in Europe. Even recent bumper cocoa crops cannot
keep up.
“All eyes are on Asia,” said Angus Kennedy, editor of trade magazine
Kennedy’s Confection. “Demand there, and in Nigeria and Vietnam, has
seen consumption increases of up to 230% a year. We are not making enough
cocoa.”
Not everyone believes the picture is so gloomy. Raphael Wermuth, head of
media relations at Swiss cocoa grinding group Barry Callebaut, which sold more
than 1.7m tonnes of chocolate last year, says that prospects for the chocolate
market are not quite as dire as some are suggesting. “The recent public
announcement from the International Cocoa Association has claimed a much smaller
cocoa deficit by 2020,” he said. “While we still think there will be a
shortfall, we believe it will be smaller than expected as programmes aimed at
increasing cocoa yields take effect.”
Other big international confectionery manufacturers, such as Mars, have
forecast cocoa bean shortages of up to one million tonnes by 2020.
But for confectioners catering for in the niche chocolate market, the gloomy
forecasts are of little concern. Lee McCoy, managing director of online retailer
Chocolatiers, which focuses on selling speciality chocolate from around the
world, said: “Although this is a big issue for large corporations, it will have
little impact on retailers like us. Most people who buy cocoa for the niche
market are already paying over the odds, so this will not affect our end of the
scale.”
McCoy believes that, in any case, change in the industry is long overdue, and
any price increase is to be welcomed. “This will be good for the people growing
cocoa, because they earn next to nothing, and so the more money therer is to be
passed down, the better,” he said. “At the moment, only a very small fraction of
the price of chocolate actually goes to the growers and so in terms of giving
people in Africa and Central America a good wage, this is an exceptionally good
thing.”
He added: “It’s not just down to the industry to be aware of chocolate
prices. Consumers should be looking to see where and how it has been
grown.Fairtrade is a start, but directly traded is better. From our experience,
going directly to growers, rather than using a middleman, means that growers get
around four or five times the price.”