Hot Chocolate!

A recent report by Reuters challenged the assumption that chocolate is a recession-proof treat that consumers continue to buy despite the grim economic outlook. Analysts said worsening economic conditions in the euro zone had prompted a sharp slowdown in European demand for chocolate. In Switzerland, the world’s top chocolate consumer, domestic chocolate consumption dropped about 8 percent by volume in the first four months of the year. In Germany, one of the world’s largest chocolate consumers, retail sales of chocolate bars fell 7.3 percent on the year in the first four months of 2012.

Thankfully fine chocolate in the UK does not appear to be affected by the same pressures. Fine chocolate is generally regarded as chocolate made from beans grown in countries such as the Dominican Republic, Ecuador, Peru, Venezeula and Madagascar. Cocoa from these countries sells at higher prices than beans from origins such as West Africa. The premium is exacerbated by economies of scale: mainstream chocolate is made on an industrial scale whereas fine chocolate is made in small batches, which inevitably costs more.

The good news is that the UK fine chocolate market is growing in leaps and bounds so higher prices do not appear be deterring ever-increasing numbers of consumers seeking out better quality chocolate.  Supermarkets have spotted an opportunity and upgraded the quality of their own-label bars so that it is possible to find good quality, high cocoa solid bars at very competitive prices. However the supermarkets are very much following the trend set by small innovative brands and the retailers who stock them.

We can summarise current trends in fine chocolate as ‘The Three Ds’:  Dark, Designated Origin and Direct Sourcing.  Gone are the days when milk chocolate dominated the UK’s palates: the sterling work done by Green & Black’s and Lindt over the past ten years has paid off so that the balance is rapidly tipping towards dark. One reason for this is the “health halo” on dark chocolate. In July Barry Callebaut AG won the backing of the European Food Safety Authority for its claim that cocoa flavonols can be good for blood circulation. Designated Origin allows consumers to appreciate how where and how cocoa beans are grown influence the flavour of the finished chocolate: what French wine-makers refer to as terroire. Direct Sourcing is a new concept. Now that there are so many onpack certification schemes – organic, Fairtrade, Rainforest Alliance, Utz and more – emphasis is shifting to companies who have a direct relationship with the farmers whose cocoa beans they use.

Divine have a unique position here as they are 45% owned by the Ghanian farming co-operative Kuapa Kokoo. The farmers have direct influence over how the company is run and share in the profits from the chocolate. Their Christmas launches build on the success of the current range. Explained Rosanna Mayhew “our new Ginger Thins will appeal to the adventurous foodie – they go along with our existing Mint Thins but are more of a daring option! To appeal for the stocking filler market we have also launched Christmas tree shaped chocolates – one milk, one dark, and one white chocolate.”

Another company with a similar ethos is relative newcomer GO*DO (it means “pleasure” in Italian), who buy cocoa beans direct from organic farming groups in the Dominican Republic, Ecuador and Peru. GO*DO embody another growing trend: affordable indulgence. Using a 35g bar size keeps down calories (195 per bar) and rsp (£0.85). Bar flavours are all very Italian – Dark, Milk, Almond,  Hazelnut,  Espresso and Vanilla. Top Sante magazine were impressed, calling GO*DO ““our favourite choccie treat”.

Green & Black’s agree that provenance and sustainable sourcing are becoming ever more significant. Monika Skrzypczak commented “Christmas 2012 for fine chocolate will be about products that provide value outside of price.  Playing alongside an increasingly price competitive grocery sector, the fine foods channel has a unique opportunity to showcase premium through products that add value, be it tasting notes that complement the Green & Black’s Tasting Collection, or through exciting displays that signpost our Premium credentials”.

A different approach has been taken by Montezuma’s, who over the summer launched a range based on the “Great British Pudding”. Flavours included Eton Mess, Spotted Dick, Apple Crumble and Lemon Meringue. Suitably patriotic packaging reinforced the quirky Britishness of the bars. A similar approach could work well at Christmas.

Another specialist brand doing well is Booja Booja. They have recently won three Organic Food Awards as well as two Great Taste Awards, including Three Stars for their Hazelnut Crunch truffles. Laura Herrell pointed out another reason for their success. “Free From is now one of the most rapidly growing sectors in the Grocery trade and has moved from being a niche to an essential part of any fine food retailers range. Our dairy free chocolate truffles are a source of great delight to people who realise that they can still enjoy extraordinarily delicious treats without suffering negative health effects.  As the country’s leading manufacturer of fine dairy free, gluten free chocolates our attention is now firmly fixed on ensuring that we are able to supply our customers what they want, whenever they want it, in the run up to Christmas.” Truffles work for Monty Bojangles too, with sales reaching 40 packs per store per week during December.

The world of Fine Chocolate may not be totally insulated from the current economic downturn but at least in the UK specialist chocolatiers and retailers appear in rude health as we head towards Christmas. More dedicated chocolate brands will launch at the Speciality and Fine Food Fair, now with its own Speciality Chocolate Fair. And Chocolate Week 2012 is stuffed full of chocolate-infused events including consumer show Chocolate Unwrapped, this year at a prestigious Covent Garden venue.

I’m dreaming of a Dark Christmas…

For more information