Cocoa “Shortage” – Some Radical Thoughts – Part 2
In part 1 of this article some alternative ideas were proposed for the medium to long term issues associated with Cocoa supply. This article considers the alternatives suggested above in a little more detail
Accept Higher Costs and Reduced Supply
Raising prices and seeing demand reduced is likely to happen in the short term, but the major manufacturers will find this difficult to sustain in an industry built on increasing volume and large scale manufacturing. Some reduction in range is likely to try to reduce costs but there is little scope for major cost savings within the current regulatory framework. There could be benefits in general nutrition if chocolate was moved from the “food” to the “indulgence and treat” category in the wider consumer mind, but this will be a generational change.
A significant limiting factor in cocoa supply/demand is cocoa butter availability. In virtually every market place for a product to be labelled as chocolate the main vegetable fat component has to be cocoa butter, constituting up to around 30% of the weight of the chocolate. Currently in most regions there is a limit of 5% added vegetable fats. These widely used fats are very similar to cocoa butter and have and compatible properties. They are derived from bulk vegetable fats such as palm, but only account for a very small proportion of the usage of those bulk fats.
An alternative solution to the current and future supply issue would be to increase the allowed level of added vegetable fats in chocolate products. Given the level of controversy and opposition which was associated with permitting 5% vegetable fats in chocolates across the EU this move would certainly attract opposition from many quarters. However, for the consumer it would be beneficial in controlling price and in spite of the regular scathing remarks from celebrity chefs and the like, consumers in the main accept the current situation quite readily and may be amenable to further changes if properly p[resented
The current generation of cocoa butter equivalents and replacers are technically sophisticated and mimic the characteristics of Cocoa butter very closely. Raising the allowed level would therefore reduce consumer prices and manufacturing costs
It is fairly straight forward to calculate the tonnage of Cocoa Beans required to produce a tonne of chocolate depending on the type and formulation. Milk chocolate in the form of blocks or coating comprises a significant majority of the tonnage in most theatres. For a typical UK milk chocolate formulation, without vegetable fats this is about 0.5 tonnes bean per tonne chocolate and for a typical European formulation slightly higher at 0.65 tonnes/tonne. This requirement is significantly reduced by the permitted use of 5% Cocoa butter equivalent fats and if this was increased further it would reduce the Cocoa bean required with very little if any effect on quality, it may well be necessary to slightly increase the Cocoa mass used to compensate for the loss of flavour from the cocoa butters, but this would be slight
Beyond this it is interesting to consider whether all the added Cocoa butter in chocolate products could be replaced by Cocoa butter equivalents, particularly for coatings. This might require a new category of products which would need to be differentiated from current low quality products made from cocoa powder and cheaper vegetable fats. Perhaps requiring that the non fat cocoa solids were in the form of cocoa mass would be a possibility, in which case CBE’s would be technically necessary because of the final fat system composition.
The following figures are indicative only, based on typical UK chocolates, each formulation would obviously have slightly varying effects
This suggests that by allowing the vegetable fat addition to be raised to 10% would result in a 28% reduction in cocoa bean required per tonne of chocolate.
Moving to all the added fat being CBE’s would reduce cocoa bean requirement by 80%.
The issue with both of these concepts is consumer acceptance. The products may be satisfactory, but the consumer is (quite reasonably) very wary of anything which cannot be labelled as “Chocolate”
From an ingredient cost point of view, there could be substantial savings depending on the price of Cocoa butter. CBE’s have always traded at just below the price of Cocoa butter, which suggests their manufacturing costs is close to that of Cocoa butter at historic rather than recent levels.
The move to complete replacement of cocoa butter as the added fat in at least some chocolates would require both regulatory and consumer acceptance of a major change from long standing tradition. This could however be a vital long term consideration with a broad range of benefits:-
- Consumer value could be maintained with less price volatility
- There would be an emphasis on Cocoa bean quality rather than quantity
- Small farmers would be protected, even if yields were reduced and some changes in practice required
- The claims that Cocoa growing contributed to deforestation would be reduced
- The reductions in Cocoa crop due to social, political and climate change which affect large scale plantation operation would be diffused
Novel “High Tech” Concepts
The current reduced supply and consequent higher prices for Cocoa has led to a number of hi-tech start ups trying to produce cocoa like solids from various alternative bean sources and microalgal, oleoogels and enzymatic attempts to produce “Cocoa butter” alternatives from non fat sources as well as producing cocoa butter compatible fats in a more conventional manner from alternative vegetable fat sources
These “alternative” sources face several potential problems which should not be ignored
- Some at least would be considered “novel foods” with all the necessary testing and regulatory requirements
- They are likely in the short term at least to be expensive compared with currently available alternatives
- Broad consumer acceptance to higher cost, less satisfactory “innovative” products is likely to be extremely low
- “Chocolate” as a reserved description is very precious to consumers and these novel products could not be described as chocolate or be acceptable ingredients within current regulations
- Producer countries and regulatory structures are extremely protective of the status quo and likely to resist any attempt to dilute the current regulations
Whilst these innovative approaches are technically very interesting and able to attract substantial investment, the more straight forward approach of increasing the level of current CBE fats in chocolate could be rapid and less technically challenging, controversial as that might be.
The current relative shortages and price increases in Cocoa bean supply should be seen as an indicator for the future and as a promoting factor to initiate longer term more radical ideas rather than just increasing prices and hoping things will improve.
A core question is how to take the consumer along the various pathways, Cocoa and Chocolate not only evoke strong emotional responses in the broad consumer population, but also give rise to what might be termed “elitist” sentiments and widely disseminated opinions by those unaffected by such a “minor issue” as the price of a child’s chocolate bar but who none the less would consider themselves to be arbiters of taste and quality on behalf of everyone.