Chocolate for many millennia has undoubtedly been the most popular and favored sweet in the world. The main ingredient in chocolate is cocoa, which is mainly grown in parts of Africa, Latin America, and Indonesia. The global chocolate market has been segmented into white chocolate, milk chocolate, dark chocolate, and other chocolates, which include unsweetened chocolates, semi-sweet chocolates. Cocoa, in the form of butter or liquor, is used to produce chocolates. The variety in chocolates depends primarily on the percentage of cocoa used. According to FDA, the percentage of cocoa in white chocolate should be at least 20%, in white chocolate at least 10% of cocoa liquor in milk chocolate and at least 35% for dark chocolates.
The chocolate market has been evolving for many decades and has adhered to regional trends. The global chocolate market has witnessed a substantial rise, owing to factors such as demand for premium products, product innovation, and branding.
The cocoa tree is native to South America and was further propagated to different regions later. Since then, cocoa cultivation has been predominant in African countries such as Côte d’Ivoire, Ghana, Cameroon, Nigeria, and other countries such as Indonesia, Brazil, Dominican Republic, Ecuador, and Peru. To make the overall cocoa industry sustainable, especially in terms of socio-economic sense, Voluntary Sustainability Standards (VSS), Fairtrade, UTZ were put forth. This has assisted in increasing the overall reliability over the cocoa supply and to mitigate the risk regarding public perception.
As per the International Cocoa Organization, the cocoa production in February 2019 was showing significant growth. Côte d’Ivoire, Ghana, and Cameroon exports were recorded to be 1.469 million tonnes, 674,735 tonnes, and 109,410 tonnes, respectively. A significant challenge has risen in terms of global cocoa demand. African countries have a very low yield per hectare as compared to Asian countries, which have the potential to match the growing demand for cocoa.
Even if 70% of cocoa comes from West Africa, many of the cocoa growers remain under poverty. This has been taken into consideration, and several manufacturers are trying to produce chocolate locally, influencing the chocolate prices, especially in Europe. This can exert pressure on the supply chain of chocolate.
Chocolate, for many centuries, has been the most preferred sweet used across diverse applications. Chocolate primarily is produced as a confectionery that comes in many forms, such as powder, liquid, paste, or the conventional block. It has been used in bakery usually in the form of compound chocolate, made up of cocoa vegetable fat and sweeteners, a low-cost alternative for pure chocolate. Additionally, milk, dark, and white chocolate are also utilized in the preparation of brownies, cakes, creams, and mousses, and even for decoration purposes.
The use of chocolate has also been on the rise in beverages. Hot chocolate and a variety of nutritional chocolate drinks are becoming trendy. Chocolate is mainly used in beverages to enhance taste, richness, and to add color. It is also used due to its masking capabilities, maintaining a clean label, and its anti-oxidant property, which is why many beverage manufacturers choose chocolate as its primary ingredient.
The rise in the trend of health consciousness has tilted the global chocolate market toward dark chocolate. On account of its higher cocoa percent, dark chocolate has been the most favored chocolate type due to its health benefits. Some of them include cardiovascular effects that regulate blood pressure and insulin resistance. The consumption of dark chocolate is also believed to benefit the immune system. It helps to inhibit the growth of cancer cells. Dark chocolate is also an anti-diabetic agent, which can act against obesity and other illnesses related to glucose homeostasis. According to the World Health Organization, 650 million adults of 18 years and above were obese in 2016, and the number is expected to rise in the coming years. Consumption of chocolate as a health enricher will likely provide a fillip to the chocolate market.
Consumer perception regarding chocolates is a point worth considering as it is one of the crucial factors that can decide what kind of chocolate will the consumer buy. Common beliefs such as bitter chocolate is healthy or bitterness determines how pure the chocolate is, are some of them. These traits play a huge role in product development and branding. Chocolate manufacturers also have to keep in mind the preference of consumers regarding their size, shape, texture, personal experience, packaging, and local trends. Customers nowadays demand both taste and health benefits. Hence, several chocolate manufacturers have launched functional chocolates that contain pre-biotic ingredients and vitamins to attract consumers. Recently, in Feb 2019, an Australian brand called Gutsii introduced its chocolate bars that are both healing and nourishing along with the usual taste of chocolate.
The changing consumer behavior compels chocolate manufacturers to be on their toes and keep on innovating newer products. This is particularly prevalent in global chocolate manufacturers where they have the required capital to facilitate product innovation. For instance, Mondelez International inaugurated its technical center in Poland in June 2017 to strengthen its growth, equipment, and capabilities. It also announced the opening of its new R&D center in India in Oct 2018, focusing on innovation. The company has invested USD 15 million in order to strengthen its position in India.
The chocolate industry is also observing a unique trend in terms of product development, where a number of manufacturers are trying to enhance their production capabilities using 3D printing. The Barry Callebaut Group announced to open its first 3D Printing studio for chocolates in Feb 2020. This will forge a new shift in chocolate production where manufacturers will be able to produce chocolates with intricate design.
Europe and North America have always been the largest consumers of chocolate. On the other hand, the Asia- Pacific market has witnessed significant growth in recent years. Rising disposable income, strengthening distribution channels in the form of retail and online stores are the critical factors behind the growth. The cocoa cultivation in Indonesia has remarkably bolstered regional market growth. Asia-Pacific houses Companies such as Marou Faiseurs de Chocolat (Vietnam), Krakakoa (Indonesia), and Chocolate Concierge (Malaysia).
The North American market for sugar confectionery still holds the lion's share in the global chocolate market. According to the National Confectioners Association, chocolate sales accounted for USD 21,100 million in 2018. The already mature market in Europe has been observing new trends. The demand for organic chocolates, on the other hand, is thriving in Western Europe.
Chocolate consumption has witnessed a dynamic change and has a strong inclination toward Western countries in Africa and Middle East countries as well. The rise in the number of expatriate workers in Middle East countries is said to be a key factor responsible for the growth of the chocolate market.
Prominent players are entering into the Asia-Pacific market to grab the available opportunities. For instance, Lindt & Sprungli AG is launching its chocolate cafes and boutiques in Japan’s prime locations to boost sales in the upcoming years. Barry Callebaut in July 2019, made a public announcement about its manufacturing plant in India, which will be operational by mid-2020.
|Market Size||USD in Billion By 2030|
|Forecast Units||Value (USD Million)|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends|
|Segments Covered||by Type (White, Milk, Dark, Other), Application (Food (Bakery Products, Sugar Confectionery, Desserts), Beverages)|
|Geographies Covered||North America, Europe, Asia-Pacific, LAME and Rest of the World|
|Key Companies Profiled/Vendors||Mars Inc, Hersheys Co , Nestlé SA , Ferrero Group , Parle Products PvtLtd, Mondel?z International , Meiji Co Ltd , Chocoladenfabriken Lindt & Sprüngli AG , Ezaki Glico Co Ltd , pladis Foods Limited , Cargill Inc, Barry Callebaut Group ,|
|Key Market Opportunities||Increasing Prevalence Of The Food & Beverages Industry Enhances The Expansion Of The Chocolate Market Share|