Valentine’s Day is a western holiday celebrating love and friendship that has spread throughout most regions of the world. Amongst the most emblematic gifts exchanged on Valentine’s Day are flowers, stuffed animals, and most importantly chocolate candies. In fact, chocolate candy sales in the United States usually exceed US$700 million during the week preceding Valentine’s Day. Similarly, the US is amongst the world’s leading chocolate importers, with more than US$1.4 billion in consumer chocolate candies imported annually. Other major chocolate importers worldwide include Russia, Canada, the European Union, and Mexico. This article explores the status of the global chocolate market.
Cocoa Production and Chocolate Markets Worldwide
Chocolate comes from the bean of the cocoa plant, which is endemic to Latin America. However, by the 1600s, European explorers had already discovered the sweet uses of the bean and had spread the cacao tree throughout the world. Today, cacao trees and cocoa beans are an agricultural commodity grown in tropical climates, such as West Africa and Southeast Asia. In recent years, Sub-Saharan Africa has accounted for approximately two-thirds (66%) of the worldwide cocoa bean output, followed by Latin America with some 15%, and Asia representing another 18% of the global output.
Throughout the last several years, the total production of cocoa beans worldwide has exceeded 4.5 million metric tons annually. Furthermore, the world’s largest cocoa bean producer, the Ivory Coast, has dominated more than 30% of the global market with an annual average of 1.3 million metric tons of beans. In terms of cocoa bean output, the Ivory Coast is followed by Ghana, Indonesia, Nigeria, and Cameroon, which together account for more than three-fourths (75%) of the total cocoa bean production.
Nevertheless, cocoa beans are not processed into chocolate in the countries where the commodity is grown. Rather cocoa beans are exported to and processed in Europe or North America. The value-added process of chocolate creation has for centuries been a profitable market dominated by a handful of producing countries, notably Germany, Belgium, Switzerland, the Netherlands, France, and the US. In fact, none of the ten largest chocolate candy producers, which dominate 70% of this consumer good market, is itself a producer of cocoa beans.
The world’s largest exporter of chocolate as a consumer good is the European Union, followed by the US. Throughout the last several years, the US has exported more than US$1 billion worth of chocolate consumer goods annually. Furthermore, the US, Mexico, and Canada are each other’s major trading partners within the consumer chocolate market, through major candy manufacturers, such as Hershey’s, Nestlé, Mars, Cargill, and Cadbury, amongst others. At the same time, the fastest growing markets for US and North American made chocolate products are located in Asia Pacific, particularly the Philippines, South Korea, Japan, Australia, Hong Kong, and Singapore.
Lastly, global cocoa bean production has increased fourfold since 1960. This substantial increase demonstrates not only an increase in the regions and areas devoted to growing cacao trees, but also the growth within the consumer market for chocolate products.