The CAGR for the world cocoa chocolate market is 4%. This is expected to continue until at least the end of 2025. It could even continue until the end of 2027. It’s expected to have a CAGR of 2.4% in the years from 2025 to 2027. Chocolate comes from the cocoa bean. This bean and the cocoa plant are native to South America.
Chocolate is harvested when cocoa beans are dried and allowed to ferment. Some useful by-products of the fermentation process include cocoa butter and solids. These are generated while making chocolate. The by-products are not useless. Cocoa butter is used in many different foods and personal care products. The same is true of the cocoa solids.
There are three main reasons why people around the world love chocolate. It’s delicious, especially when combined with butter and sugar. It also has valuable antioxidant and anti-inflammatory properties. This is crucial since it can prevent people from developing many debilitating diseases like cancer. It can also prevent people from becoming arthritic.
COVID-19 first appeared on the global stage in March of 2020. It was at best a nuisance virus. However, since it could be dangerous and even deadly for some people, governments decided to impose quarantines and lockdowns. The objective was to try to contain its spread. This had limited success. COVID-19 cases went up but not as much as they otherwise would have had social distancing, mask-wearing, pointless contact, etc… not been required.
Many industries and companies were forced to shut down. This negatively impacted the world cocoa chocolate market since it made it harder for these manufacturers to procure the raw materials needed to make chocolate at affordable prices. Also, people were suffering economically because of COVID-19. They were cutting back on nonessential purchases like chocolate. In any case, manufacturers found their production costs going up dramatically. They were forced to pass these higher costs onto the end consumer in the form of higher prices.
COVID-19 notwithstanding, the CAGR for the world cocoa chocolate market is growing at a modest but respectable and stable pace because a growing number of people around the world are being educated on the many health benefits of chocolate. They want to eat healthier so that they can look and feel healthier. Thus, they are willing to pay a premium for chocolate, especially if it’s good chocolate.
Another important driver of cocoa chocolate market growth is the fact that the middle classes are growing rapidly in developing nations. These people enjoy higher disposable incomes and greater purchasing power. They are also willing to pay a premium for luxury goods like imported Western chocolate. The middle classes in developing nations like India and China are increasingly health-conscious as well. Like their Western counterparts, they want to eat foods and maintain a diet that will make them healthy and keep them that way.
Incidentally speaking, these people also crave exotic Western foods.
There is a growing preference for organic products in the food and clothing industries. The world cocoa chocolate market is no exception. In fact, people are willing to pay higher prices for foods and pieces of clothing that are organically certified. Chocolate and cocoa manufacturers are paying attention. They’re responding by incorporating organic cocoa into their food products.
Manufacturers of chocolate and cocoa products find that incorporating organic cocoa also serves another benefit. It keeps people healthier and allows them (manufacturers) to justify charging the end consumer higher prices.
Most of these manufacturers are engaging in heavy research and development. Their ultimate objective is to increase the overall CAGR of the industry by coming up with innovative products that are healthy. They are doing extensive research to understand what products people around the world need and are willing to buy. Then, they are focusing their efforts on manufacturing and selling those products.
There is a major restraint for the world cocoa chocolate market. Cocoa is a commodity because it’s a fruit. Fruits and vegetables, even those that are cash crops (like chocolate is) are traded on open markets around the world. However, since these markets are very sensitive to current political and economic events, the price of the cocoa bean (fruit) can change dramatically and rapidly in a few hours. This can raise the costs of production. Manufacturers have to absorb the higher costs by charging the end consumer more.
Research has indicated that when the prices of elastic goods increase, people will flock to lower-priced substitutes. The cocoa bean and chocolate are elastic products because there are many readily available substitutes.
One of the key challenges that cocoa chocolate market manufacturers will face in the future will be in keeping production costs down even when the price of the cocoa bean rises dramatically. They must do this to keep the final costs (retail price) of the chocolate stable for the end consumer. This is the only way that people will be incentivized and motivated to buy more chocolate.
Cumulative growth analysis
The CAGR of cocoa chocolate market until 2025 is expected to be 4.48%. The CAGR in the years between 2025 and 2027 is expected to be 2.44%.
Mars Inc is a major American company in the global cocoa chocolate industry. It’s surviving through major technological innovation which is the result of extensive investment in research and development. They have invested heavily in better yielding crops and in equipment that processes foods much better.
The result is the ability to produce lots of nutritious food that is also tasty. This has solidified Mars’s position as a market and industry leader.
Many of these chocolate manufacturers also make the raw ingredients and materials for many major and life-saving prescription drugs.
Many chocolate manufacturers make sweets. One of these is Mars. it makes the popular candy M&Ms. It also makes Mars bars.
By Food and Beverages
These companies also incorporate chocolate and cocoa by-products into many food and beverage products. For example, Nestle makes Nesquick. This is a mineral-boosting chocolate product that tastes delicious. Many young parents add it to milk to boost the overall caloric and nutritional intake for their young kids.
Nesquick is sold in powder and liquid forms.
Cocoa butter is used as the main ingredient in many cosmetics and personal care products. It has strong healing properties. It can also deliver intense moisture to the skin and it’s an excellent binder of and to materials.
There are four main regions:
North America has the highest market share because the demand for chocolate is highest in this region. Also, many of the major chocolate manufacturers are in America. A few are in Canada. Additionally, a growing number of people are learning about the benefits of chocolate for their health. They are demanding that food manufacturers, in general, incorporate more chocolate and chocolate by-products into different types of products. Carnation instant breakfast is a good example of this. The chocolate in the powder is what gives this breakfast drink most of its important nutrition in the form of vitamins and minerals. However, Carnation instant breakfast comes in bar and liquid form.
The European Union has the highest CAGR.
The Asia-Pacific region has a growing CAGR. The middle classes are exploding in this part of the world. They increasingly hunger for Western name brand goods like Godiva and Ghirardelli. They are willing to pay a premium for these products. These middle classes are also trying to imitate Western lifestyles and diets. A growing number of people in these middle classes are also health and nutrition conscious.
Because they want to live healthier, they want to eat healthier. This is the reason why they’re willing to pay a premium for healthy foods that have chocolate and chocolate by-products in them.
There are few barriers to entry so competition is intense in this ‘dog eat dog’ market. Companies are finding that they can survive only if they invest heavily in research and development. It’s through research and development that they can find the technologies to develop innovative products with good health benefits that they can market and sell at a premium.
However, research and development alone are not always enough. Many companies are finding that it’s difficult to enter into new markets. They are trying to enter into strategic partnerships in an attempt to solidify their market position in existing markets. They also want to enter into new markets.
Companies are also merging with and acquiring other companies. The objective here is to try to solidify existing market positions and enter into new markets.
Mars Inc is a major player in the chocolate industry. It does more than sell candy brands. It has diversified by selling petcare and innovative food products. It has also invested heavily in research and development to develop and market foods that are tastier and more nutritious.
List of companies
The cocoa chocolate market has a modest CAGR. This is largely driven by increased world demand for chocolate products. The volatility of the cacao bean price is one element that could threaten the growth rate. This is especially true in light of COVID-19
Cocoa Chocolate Market – Summary
Cocoa chocolate and mankind’s affair dates back to at least two millenniums when the Olmecs discovered cocoa fruit as edible and a source of energy. Since then, each has only grown fond of the other. First in Mexico, then by Aztecs and Mayans it was cultivated before enthralling the Spanish to reach the mainland of Europe as an exotic fruit in the sixteenth century. Since then, it has been commodified and has gone zillion times under the lens to evolve continually. The trade surrounding it has grown manifolds in the last century. And market giants want a piece of that for themselves. The global cocoa market is expecting a revenue hike by a moderate CAGR of 4.84% during the forecast period (2018-2025) whereas, the chocolate market is expecting a growth rate of 2.44%. Market Research Future’s (MRFR) report on the same includes proper segmental and regional analysis to have an overall knowledge of the cocoa chocolate market.
Among the drivers, its popularity spanning across ages and regions is the chief driving force behind the cocoa chocolate market growth. Market players are banking on that in their endeavor to expand their business. Celebrity endorsement and product promotion are further increasing its market penetration. Cocoa chocolate has health benefits; with anti-oxidative, anti-inflammatory, and anti-depressant properties it has created a niche which will only increase in volume over the time. Furthermore, cocoa chocolate is generating huge demand in sectors such as confectionery and food & beverage, pharmaceuticals, and cosmetics.
Organic cocoa and chocolate are getting noticed by a lot of people lately for its zero chemical and artificial ingredient property. Growing health-related awareness among people is impacting the market the most. The industry is witnessing several key players setting up boards to increase research & development and better the market flow of the cocoa, from production to consumption. Researches are initiated to enhance the production rate and entice consumers with new production pattern and flavors.
However, fluctuating raw material price can cause more damage to the market than ever imagined. Oscillating prices can hamper the smooth growth that the cocoa chocolate market has been enjoying for so long during the forecast period. At the same time, local markets are overwhelmed by several substitutes which can counter the regular growth rate of the cocoa chocolate market.
Application-wise segmentation of the cocoa market includes confectionery, food & beverages, cosmetics, and pharmaceuticals. The estimated market volume could go up from 4,263.2 kilotons to 5,331.4 kilotons by 2025, with a CAGR of 3.25% during the forecast period. Food & beverage sector can emerge as the biggest segment, but the fastest CAGR can be attributed to confectionery.
The same segmentation of the chocolate market comprises confectionery, food & beverages, cosmetics, and pharmaceuticals. During the forecast period, a scaling of 9,431.8 kilotons seems easily achievable with a CAGR of 2.12%. Food & beverage sub-segment will have the largest market volume of 4,998.9 kilotons by 2025 whereas, confectionery can register the fastest CAGR of 2.40% during the same time frame.
Geographically, the cocoa chocolate market covers North America, Europe, Asia Pacific, and Rest-of-the-World (RoW).
By consumption, the global cocoa market can further be segmented into value and volume. The market can reach a market valuation of USD 16.61 billion with a 4.48% CAGR. Currently, Europe claims the top spot and the market valuation could reach USD 7.29 billion. However, the APAC would register the fastest CAGR of 5.22% during the forecast period. By volume, the market can ensure 5,331.4 kilotons production with a 3.25% CAGR during the forecast period with Europe in the lead with its predicted market production of 2,372.5 kilotons. However, the APAC region can register the fastest CAGR with 4.01% during the review period.
Consumption-wise segmentation of the chocolate market leads to value and volume. The value-based market has Europe in a commanding position with USD 46.73 billion valuation in 2018, and it can go up to USD 54.71 billion during the forecast period. However, the APAC can register the fastest growth rate of 3.04% during the review period. Volume-wise, Europe leads the segment with 3,159.3 kilotons of production and its position can remain the same during the forecast period with the output rising to 3, 621.8 kilotons. However, it is the APAC that is expected to show the fastest growth rate of 2.76%.
The global cocoa chocolate market experiences strategies such as investment, merger, regulations, research & development, acquisition, product launch, expansion, joint ventures and many other formats being implemented by the market influencers. Of these, joint venture is the most effective strategy and has control over 42% of the market.
Key competitors influencing the global cocoa chocolate market are Cemoi Chocolatier (France), Republica del Cacao (Ecuador), Nestlé S.A. (Switzerland), Mars Incorporated (U.S.), Irca S.p.A. (Italy), Fuji Oil Holdings Inc. (Japan), Guittard Chocolate Co. (U.S.), Ghirardelli Chocolate Co. (U.S.), Varihona Inc. (France), Barry Callebaut AG (Switzerland), Alpezzi Chocolate SA De CV (Mexico), Kerry Group Plc (Ireland), Olam International Ltd. (Singapore), Tcho Ventures Inc. (U.S.), The Hershey Company (U.S.), Cargill, Incorporated (U.S.), Foley's Candies LP (Canada), Puratos Group Nv (Belgium), Ferrero International S.A. (Italy), and others.