Faced with a global cocoa shortage, Indian chocolate and confectionery manufacturers have resorted to price increases, quantity reduction, local sourcing and the use of carob powder.
The decline in cocoa production in Ghana and Ivory Coast has led to a global cocoa shortage, which has put enormous pressure on chocolate manufacturers. Companies are accepting price increases of up to 10 percent.
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“To mitigate the impact of rising cocoa prices, we have adopted a diversified approach. This includes a modest price adjustment of around 8-10%. A comprehensive review of packaging and supply chain spend has been undertaken to identify cost reduction opportunities. To maintain the growth trajectory and diversify the product portfolio, we have accelerated the launch of a new range of snack chocolates, a key part of the product roadmap 2024-25,” said Vimal Sharma, Founder-Director and CEO, SMOOR.
Chocolate makers are now sourcing locally produced cocoa.
Anshi, Co-founder of Colocal, said, “In India, Kerala and Andhra Pradesh produce the majority of the country’s cocoa. Colocal sources single-origin beans from Idukki, Kerala. It takes about 5 years for a cocoa seed to start bearing fruit, so the replanting rate is very low. Many brands also incorporate other ingredients to offset the cost. However, at Colocal, we have decided not to change course. We still produce 1.5 tonnes of chocolate per month.”
Chocolate Baked Goods
Due to rising cocoa prices, small bakers and home chefs are closing their businesses.
Srinivas Rao, Managing Director, Birdy’s Bakery, said, “The Indian chocolate market has grown due to the increasing lifestyle choices of the middle class. New products and innovations have been introduced. This market has shrunk considerably. Single owners have opened a small bakery and made and sold cakes from these premises. Home bakers have mushroomed. A number of them have had to close down. Birdy’s has worked with multinationals to develop ready-made chocolate solutions to replace the basic products they were making themselves.”
Bakeries are gradually moving away from non-chocolate desserts and are increasingly focusing on fruit-based products.
“As India is relatively new to the chocolate market as a producer of cocoa beans, it is facing a price hike. Multinational brands are increasing their prices by 20-30% for the final product to compensate for the cost of cocoa and are planning to increase it further by making chocolate less affordable. As pastry chefs, we plan to take advantage of this shortage to experiment with new flavours or use alternative ingredients,” said Chef Sehaj Ghuman, Pastry Chef and Instructor at the Academy of Pastry and Culinary Arts, India.
“We have reduced the amount of chocolate desserts in our menu and have deliberately promoted non-chocolate desserts like fruit products or other desserts that do not rely on chocolate or rely only on it. The prices will increase further if the next cocoa production is again affected by bacteria and the crops are damaged,” said Rahul Seth, founder and owner of Patisserie’22.
