Organic Chocolate Spread Market

Market Overview

The global organic chocolate spread market size was valued at USD 621.1 million in 2022. It is estimated to reach USD 907.3 billion by 2031, growing at a CAGR of 4.3% during the forecast period (2023–2031). With organic chocolate spreads becoming an essential breakfast item, their demand is likely driven by the rising consumer interest in low-calorie spreads throughout the forecast period.

Organic Chocolate Spread is a spreadable organic chocolate-based product used as a topping or filling for bread, toast, pancakes, and other treats. The worldwide Organic Chocolate Spread market has continuously developed because of the increased demand for organic and healthier food items. Key market participants provide a variety of goods, including dark chocolate spread, milk chocolate spread, and hazelnut chocolate spread, among others. Organic Chocolate Spread is commonly used in home and commercial settings such as hotels, cafés, and restaurants. Organic chocolate spreads may also be used in baking and cuisine.

Market Dynamics

Global Organic Chocolate Spread Market Drivers

Organic Chocolate's Health Benefits are Gaining Popularity

Consumers throughout the world are increasingly preferring healthy cuisine over traditional pleasures. Despite their delicious flavor and opulent appearance, chocolate spreads are often not considered healthful. However, customers worldwide are becoming increasingly interested in organic options as they learn about the health advantages of organic chocolate spreads, particularly dark chocolate variants. With organic chocolate spreads becoming an essential breakfast item, their demand is likely driven by the rising consumer interest in low-calorie spreads throughout the forecast period.

Product Innovations Favoring Market Growth

Recent years have witnessed various product launches and innovations in the organic chocolate spread category. For instance, in February 2021, Valeo Foods, an Irish multinational food and beverage company, entered the chocolate spread space by launching ChocoBee, which is made using 100% sustainably sourced ingredients. This new product range also signaled the brand's departure from honey-based items. In another instance, UAB CHOCO GROUP, a Lithuania-based chocolate manufacturer, launched its new line of organic chocolate spreads under the Mulate brand at the Nordic Organic Food Fair in November 2019. These spreads included caramel, black currant, nuts, and tahini. Food fairs and chocolate festivals are prominent locations for brands looking to showcase their products and target various consumers.

Numerous vegan food makers have also ventured into the organic chocolate spread market in recent years. For instance, in September 2020, Violife, a Greece-based vegan food manufacturer, launched a new vegan chocolate line under the Violife Cocospread brand. Violife marketed its new product as free from soy, nuts, gluten, and dairy. With an average calorie intake of only 235kcal per 100g., the Violife Cocospread was intended to offer customers an alternative to other mainstream products.

Global Organic Chocolate Spread Market Restraint

Increasing Threat of Substitute Products

Conventional and other spreads are the most superior substitutes for organic chocolate spreads worldwide, notably in Asian markets. While the popularity of organic chocolate spreads has been increasing across Asian countries such as India and China over the past decade, the average Asian consumer is yet to consider such Western indulgences as an integral part of their breakfast routine. Such factors demand organic chocolate spreads to invest heavily in advertising or promotional activities created to increase consumer awareness regarding the health and environmental benefits associated with organic chocolate spreads.

Organic chocolate spread manufacturers face immense competition from fruit spread, jam, or marmalade brands. While chocolate spreads are principally targeted at chocolate lovers or kids, fruit spreads or jams are preferred by a significantly varied set of consumers worldwide. Furthermore, the increasing instances of product innovation and launches in the fruit space have made it even more challenging for organic chocolate spread brands to stay competitive.

Global Organic Chocolate Spread Market Opportunities

Rising Per Capita Chocolate Consumption

Given European countries' rising per capita chocolate consumption, prominent organic chocolate spread manufacturers will likely target European consumers over the forecast period. The established perception among a sizable number of European consumers that chocolate spreads are an integral part of an individual's breakfast routine will likely facilitate regional expansion. On the other hand, prospective brands are expected to target Asian markets such as China, India, and Japan due to cheap land and labor availability.

Furthermore, the sheer population in these countries offers lucrative business opportunities for relatively new brands to exploit. Over the medium term, the organic chocolate spread market will become intensely competitive, given the consumer demand for innovative chocolate spreads. In this respect, packaging will play a key role in allowing brands to achieve product differentiation. Given their vegan and sustainable halo, organic chocolate spreads packaged using environmentally friendly or sustainable materials will help build greater consumer interest worldwide.

Regional Analysis

Based on region, the global organic chocolate spread market is bifurcated into North America, Europe, Asia-Pacific, Central and South America, and the Middle East and Africa.

Europe Dominates the Global Market

Europe is the most significant global organic chocolate spread market shareholder and is estimated to exhibit a CAGR of 4.2% over the forecast period. Europe houses some of the world's most revenue-generating countries, such as Russia, Spain, and Switzerland, for organic foods, owing to many exports. Such factors are likely to bode well with the regional growth. Europe is the world's largest chocolate producer and has the highest number of organic-certified firms that also create spreads. Furthermore, emerging organic and fair-trade certified cocoa enterprises and regional organic product sales are projected to promote regional market expansion. Furthermore, the region's large millennial and Gen Z populations will likely drive significant demand for the product.

Asia-Pacific is anticipated to exhibit a CAGR of 5.2% over the forecast period. The Asia Pacific market for organic chocolate spread is competitive and highly fragmented due to many international and regional players. Chocolate spread companies have also used social media marketing and celebrity endorsements to gain a considerable regional share. For instance, in May 2019, Epigamia, an FMCG brand, entered into a strategic partnership with Bollywood celebrity Deepika Padukone and launched a new product line- Crafted by Deepika chocolate spreads, which are made of desi ghee and contain no preservatives. Such initiatives are likely to boost the future demand for organic chocolate spreads.

Additionally, many international brands are penetrating developing countries such as China and Japan to explore new markets and gain significant market shares. Moreover, rising awareness among consumers about the favorable health effects associated with the consumption of dark chocolate is a significant factor contributing to the demand for dark chocolate spreads.

North America houses some of the world's most renowned chocolate companies, including Hershey and Mondelez International, which offer various chocolate products and confectionery. Additionally, the region has a larger number of consumers who are inclined toward organic food products, which is driving market growth. According to a 2019 U.S. Department of Agriculture report, consumer preference for organically produced food items has continuously spurred in the past few years, showing double-digit growth in organic product consumption. This has led to an increase in store shelves and stock-keeping units of organic products, with nearly three out of four conventional grocery stores selling organic products. Furthermore, many introductions and products in the organic chocolate spread segment with a focus on price, packaging, and ingredients by manufacturers are expected to drive market growth further shortly.

Central and South America, Latin America, and Brazil are hot spots in the Central and South America organic chocolate spread market, as consumers in this region are inclined toward organic foods and organic produce. Consumers in the region have been showing increasing concerns about the health implications of high sugar consumption. Therefore, the rising health and wellness trends continue to spur the sales of reduced-sugar chocolate spreads, as consumers are shifting to dark chocolates with low sugar. Therefore, health and premiumization trends drive the Central and South American organic chocolate spread market. The region's middle-class population has grown significantly in recent years, with growing job opportunities enabling them to spend on healthy products. This is expected to favor market growth.

The Middle East and Africa, South Africa, Saudi Arabia, and Israel are the key markets for organic chocolate spreads in the Middle East and Africa. International organic chocolate brands will likely boost their brand reputation by penetrating Saudi Arabia, South Africa, and UAE markets in the forthcoming years. A large customer base for chocolates and chocolate-based products is present in these countries. As with most other international markets, the important drivers of organic chocolate consumption include growth in population size, rising per capita chocolate consumption, and rising consumer income levels.

Segmental Analysis

The global organic chocolate spread market is bifurcated into type and distribution channels.

Based on the type, the global organic chocolate spread market is bifurcated into hazelnut, duo, milk, and dark.

The hazelnut segment dominates the global market and will likely exhibit a CAGR of 4% over the forecast period. Hazelnut is known to promote heart health. Moreover, it is highly nutritious—it contains vitamins, minerals, antioxidant compounds, and healthy fats—among the key factors driving its popularity. Experts recommend hazelnut as part of a balanced diet because it is high in dietary fiber, which helps regulate bowel motions. Also, hazelnut chocolate spread is a tasty snack and a great addition to many dishes. Consumer's inclination towards hazelnut as a healthy and tasty ingredient has also encouraged manufacturers to incorporate it in a maximum number of food items. These perceptions and the versatility of organic hazelnut chocolate spread that makes it ideal for usage in various food products are driving the segment growth.

Based on distribution channels the global organic chocolate spread market is segmented into supermarkets and hypermarkets, online, and others based on distribution channels.

The supermarket and hypermarket segment dominates the global market and will likely exhibit a CAGR of 3.9% during the forecast period. Organic or conventional organic chocolate spreads are popular goods supplied in supermarkets and hypermarkets by local and worldwide companies. These establishments attract many customers and are typically placed in the heart of a city. Consumers visit these stores on weekends and holidays to buy household items and groceries. The cost of items at these stores varies by brand, giving customers the choice of selecting things from several brands based on their budget. Hypermarkets and supermarkets sell various organic chocolate spreads offered by various brands. Owing to the rising demand for organic chocolate spreads and the increasing shelf space, many supermarkets and hypermarkets have trained professionals who know about organic product specifications to answer consumer questions about ingredients and the manufacturing of various organic products.

Some major retail giants operating in the market are Kroger, Walmart Inc., Costco Wholesale Corporation, and Target Corporation. These companies have brick-and-mortar stores in several countries and sell products online through their websites. Supermarkets and hypermarkets offer relatively lower prices than retail stores, as consumers purchase products in bulk from these self-service superstores.

Recent Developments

• May 2023- Hu Kitchen, an organic chocolate company, secured a USD 10 million Series A fundraising round. Hu Kitchen will use this cash to develop its product line and distribution network.
• January 2023- Barry Callebaut, the world's largest chocolate manufacturer, paid USD 500 million to buy the organic chocolate brand Alter Eco. This acquisition will allow Barry Callebaut to strengthen its footprint in the booming organic chocolate sector.