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MARS, Inc: We Are Running Out of Chocolate
schwit1 writes There's no easy way to say this: You're eating too much chocolate, all of you. And it's getting so out of hand that the world could be headed towards a potentially disastrous (if you love chocolate) scenario if it doesn't stop. ... Chocolate deficits, whereby farmers produce less cocoa than the world eats, are becoming the norm. Already, we are in the midst of what could be the longest streak of consecutive chocolate deficits in more than 50 years. It also looks like deficits aren't just carrying over from year-to-year—the industry expects them to grow. Last year, the world ate roughly 70,000 metric tons more cocoa than it produced. By 2020, the two chocolate-makers warn that that number could swell to 1 million metric tons, a more than 14-fold increase; by 2030, they think the deficit could reach 2 million metric tons.
Chocolate rations have been increased to 20 grams!
Forget Ebola, forget IS, forget running out of IPv4 addresses, finally a real reason to panic.
So go ahead, make the most of it!
"There's no easy way to say this: You're eating too much chocolate, all of you."
My dentist has been telling me this for years. So has my wife. Do you think they're seeing each other?
I am starting to grow fond of the phrase "chocolate hoard".
Chocolate prices rise, people have larger incentive to grow cacao. I'm failing to see what the issue here is.
It's probably worth mentioning here that Mars, Inc. is one of the big players in the Cocoa futures market. This is not investment advice, but if you invest in cocoa futures based on this article, you would be making a bet based on a story from someone who hopes to make money off of you.
How can you eat more than stuff gets produced? Is there a secret vault with a strategic cocoa reserve?
Or should the submission read : Cocoa orders couldn't be fully fulfilled by the markets?
So, kind of an obvious question. How are we covering the deficit? If we are eating more than is being produced, how is that possible? Are we tapping into some big strategic cocoa reserve that is slowly dwindling?
I did quickly RTFA, but neither mentioned anything about this.
-"Those who fought today will die tommorow."-
The cause is obviously over-fishing of chocolate by the Japanese.
How is this supposed to work? Are they just printing more cocoa beans?
I can imagine demand rising a lot, but unless there are huge cocoa reserves
somewhere (which I doubt in the case of a perishable) in the order of multiple
yearly harvests (global production seems to be somewhere around four million
tonnes), I can't see how this demand is going to be met with actual chocolate.
They could alleviate some of this problem by contacting the people who run Trader Joe's. They have this one dark chocolate bar (can't recall the name of it) that is so nasty and bitter, that it is inedible completely (unless you dip it in honey, then it is barely tolerable). It is worse than baking chocolate and is actually sold as if it is intended to be eaten like a normal bar of chocolate. If they just full stop quit producing that travesty, perhaps that could free up chocolate resources for other uses for perhaps another year or so.
This space unintentionally left blank.
Now, if there was a serious shortage of beer or pizza, I could see that that would be worth discussing.
Chocolate is mostly an obsession of women, and children of tricks or treats age. I don't know why that is, but it never bothered me enough to investigate.
If the price of cocoa was exploding, then people would plant them. And yet the price barely went from 1500$ per tonnes in 2005, to a spike of 3000$ between 2009-2011 and now is down to 2000$ per tonnes. So if there is cocoa beans missing , why is the price going down ? I am willing to bet that there is some non-free-market shenanigan going on here. Otherwise as cocoa goes missing the producer would get better price, and more people would plant them.
C. Sagan : A demon haunted world:
http://www.amazon.com/gp/product/0345409469/
visit randi.org
Newsflash! The farmers can now make more on growing cocoa instead of opium because the price of chocolate has risen, whilst the price on drugs is declining. The war on drugs is won by market trends and not with guns.
Underholdning.info
I think people could get behind Senator Wonka's bill.
In fact look here : http://www.unctad.info/upload/... we are still at lower price than 1978, way lower in constant dollar, although production is increasing.
C. Sagan : A demon haunted world:
http://www.amazon.com/gp/product/0345409469/
visit randi.org
>> Last year, the world ate roughly 70,000 metric tons more cocoa than it produced.
>>... midst of what could be the longest streak of consecutive chocolate deficits in more than 50 years
From the link apparently this streak is 6 years.
I find it hard to believe that 7 years ago there was a stockpile of maybe a half a million tons of cocoa, especially as it is a perishable item.
"...the world ate roughly 70,000 metric tons more cocoa than it produced..." I hadn't heard that Obama ok'ed dipping into our strategic chocolate reserves. Anyone know how much is left?
I am still PO at the EU to allow using other type of fat and still letting it called chocolate. Basically they allowed replacing higher quality fat with lower quality fat, which fits my definition of "adulteration".
C. Sagan : A demon haunted world:
http://www.amazon.com/gp/product/0345409469/
visit randi.org
Waste not want not.
Here's to losing my Karma Bonus again....
The size of deficit is not terribly useful without knowing the size of the stock available. How much is there sitting around to be eaten?
In the EU a few years back, a multi-millionaire attempted to take control of the ENTIRE chocolate raw ingredient market with the specific intent of synthetically massively raising the cost of the finished product, in order to earn BILLIONS. He failed, but similar business groups are still attempting to do the same, and use pre-emptive PR nonsense about the need for chocolate prices to explode to lay down the ground for the necessary financial support from banks and investors. The 'money-men' need to believe the coup plotters will succeed in inflating the price of finished chocolate bars and thus return a massive profit on their initial investment.
We same the same thing with the FILTH that control the diamond trade. As every INTELLIGENT person knows, diamonds are only semi-precious stones, artificially promoted as precious stones by a tight-knit group of criminal families that have taken over the majority of the planet's bulk diamond trade. Recently, when these criminals faced competition from new diamond supplies from lands not under their control, they had their family friends in Hollywood and the mainstream media invent the 'myth' of 'blood' diamonds- 'bad' diamonds that decent people should shun, as they shun ivory.
We see the same thing with the FILTH that control the computer RAM trade. A synthetic stock-market in RAM chips was created by people OUTSIDE those that manufacture the chips (using a similar principle to the control of diamonds) so more more could be made by RAM traders than was ever made by RAM manufactures. These people used their political influence in Washington and the EU to prevent actions against RAM price-fixing, and as a result RAM prices have rocketed upwards even as sales of PCs have stagnated over the last few years.
Capitalism FAILS when criminal scum 'middle-men' are allowed to interfere in the relationship between manufacturers and customers by plotting criminal enterprises that produce so much profit, all troublesome politicians can be happily paid off.
Without criminality, there is a natural feedback loop in all forms of Human farming. We call this 'supply and demand'. If more people eat chocolate, more of the raw ingredients will be farmed with greater efficiency. Those spreading the FUD that more demand = higher prices rely on just how dumbed-down the sheeple have become in the last few decades.
Recycling?
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Stop wasting it on shitty, low-quality candy, then.
Why do you think Mars is an acronym?
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
I have a strong suspicion that the many resource depletion posts we see on here employ faulty forecasting techniques.
In this case, the article never mentions anything about how prices adjust to:
-demand
-supply constraints
-externalities
It's through prices that all those things communicate and avoid dire situations.
PS: I don't reply to ACs.
I bet the US have "strategic military reserves" or something stacked up somewhere. As is usual in such cases, however, a conflict will break out in Europe... The pleasing thing is that the Swiss don't get to play neutral this time!
since you make your candy bars 10% smaller every year (and charge the same price if not more)
Cocoa is very labor intensive way more than you can reasonably expect and today these remote communities have roads to them. Farmers can now grow bananas, pineapples, passion fruit etc for a lot less labor and have it at port in just a few days. For this reason many cocoa farmers are cutting down their trees and replacing them with crops that are less labor intensive. Additionally the youth are looking to jobs in oil (such as in Trinidad) or in the cities.
What foods are similar to cocoa in terms of labor? Truffles, saffron, vanilla, good cheeses etc. all of which are very expensive comparatively. Nobody faults these for not being $3/lb or less
What's the solution? To pay the farmers more. Right now, Cocoa sells for approx $2800/ton and in my opinion it should be closer to $10,000 - $20,000 / ton. This means that a chocolate bar would sell for $6-10 depending on packaging. (We currently sell chocolate we make from cocoa from Chuao Venezuela where we pay $5.50/lb for the cocoa where the London market was around $1.40/lb so we paid the farmers four times the market rate.)
Don't be wooed by so called "fair trade" certification. When I see that, I know the farmers just got screwed. Why? With Fair trade the farmers get a premium of $150-$200/ton -- a price increase of 5%. On the other hand, the FT organization charges the farmers between $2500 - $10000/year for the certification and in personal experience I've only seen it at $10,000 / year. At the same time they charge $0.10/lb ($220/ton) to whoever imports it for it to maintain its FT certification and another $0.10/lb for thr use of the logos and trademarks. So FT gets $440/ton and the farmers get $200. Not so fair. Plus don't forget the farmers certification and of course the companies need to be certified too. Oh yea. The inspectors are $750/day plus travel.
So what to do? Buy good chocolate. A bar should be anywhere from $5-$15. You can't make really good chocolate without using great cocoa. You can't get great cocoa without paying a significant premium to the farmers -- often 2-4 times the NY or London terminal price. So you know they are paid well. You simply can't have a $1-2 chocolate bar after if has been run though the supply chain (stores, distributors, the factory, various cocoa brokers, etc.) and know the farmers were paid well no matter the certification.
Severe munchies in some states.
This sounds like banana's, and even pork - where those selling the product make enough fake news about a fake shortage - then raise the price. There is no shortage and never was. There is just folks willing to lie - so they can charge more for delivering less value. It is low-grade thuggery and makes systems inefficient.
Tomorrow: Mars announces Soylent Brown
Don't forget Ebola. The Ivory Coast grows a huge amount of the world's cocoa. It is right next door to Liberia. Most of the labor to harvest the cocoa crop is migrant labor from Liberia. Ivory Coast has closed its border with Liberia in response to the Ebola. So, the cocoa crop there is not going to be harvested unless the growers figure out another source of cheap labor. Stock up on chocolate now.
Have any of you eaten ice cream lately? Its better then half AIR. They are pumping so much air into ice cream you can plug you mouth with it and still get enough air to not pass out. I refuse to buy ice cream anymore. I make my own. Try melting it it doesn't melt to a puddle it stays fluffed up. We are getting assraped by the food industry The ice cream rip off is only one small example.
Jack of all trades,master of none
I wonder if there is a 'National Strategic Chocolate Reserve'. Its a proven morale booster and reward system. Might be handy to have a lot of it on hand in times of crises.
Well if there is not a National Strategic Chocolate Reserve, I bet there are quite a few countries who could use some imported US democracy!
Seriously, these companies should be working on the cacao plant to get it to grow in other environments. Right now, it is grown in many locations that are ran by drug lords, gangs, etc.
However, it is pricy enough that it could be grown in greenhouses further north.
I prefer the "u" in honour as it seems to be missing these days.
So you're saying we're at peak chocolate now? Can't we just build pipelines to get the crude into our factories? Maybe use solar energy in it's production?
So, in addition to women... Mars Needs Chocolate!
cut out the bliss point bullshit that makes your products addictive and everyone will be doing better. fewer people will develop type II diabetes and you will have a viable long term strategy. what's that? you dont want to affect your profits despite being a sound strategy? hmm, sounds like you are the problem.
Anons need not reply. Questions end with a question mark.
My Wife's response:
"OK that's it, I'm cutting you and the kid off. More for me!!!"
Min
On the whole, I find that I prefer Slashdot posts to twitter ones because I don't get limited to 140 chars before
Not only is chocolate labor-intensive, it's a terrible excuse for a plant. If its seeds are not spread by animals, it will either rot on the tree, or fall right next to the parent and compete with it. Also, at least in Central America, the primary pollinator of the cacao plant is some sort of tiny sandfly -- locally they call them "chitras". And it's not like they're growing this stuff on nice flat fields in neat rows either. Even after the harvest, you have to hope that the weather stays nice long enough to ferment and dry the beans. And then, as you say, they have to contend with a miserable pay scale. There may be worse occupations, but I can't think of any offhand.
Those who advocate genocide deserve every protection afforded by law, and none afforded by common human decency.
Expect divorce rates among the lower income levels to rise as women lose the ability to cope without chocolate.
This is not a real problem.
Demand goes up.
Supply doesn't match demand.
Prices go up.
Demand adjusts downward to meet prices.
Simple market corrections.
This is not a real problem.
In the early 60s I worked as an exterminator. Our company was hired to fumigate warehouses full of cocoa beans owned by Nestle. They hired every vacant warehouse in New York State to hold those beans. I got to see a lot of warehouses and an unimaginable quantity of beans. The fumigations were strictly precautionary.
I was told that Nestle was taking advantage of low world prices and had bought the the entire world' scrap,of cocoa beans for thst year. In following years, they could either sell them at a profit, or use them up in Nestle chocolate factories.
Since supply is constrained and this is a trend not a blip, they should double prices now, and as demand drops below the increased revenue line, the day it was implemented, be the first firm to announce "lower prices" which nobody will be able to duplicate! Or argue with.
JJ
Time to come up with chocolate substitutes.
I suspected very much as I read this that that is exactly what this is about. Some of the candy companies have been wanting to and trying to get regulations passed that let them produce lower quality stuff and still call it chocolate, which they can't do currently in the USA (although some pass off some pretty poor crap and the consumer thinks that they are getting chocolate). I find it very hard to believe that on an on-going basis we are consuming more chocolate than the farmers can produce. Sure, one year or even a couple that might happen, but if it happens every year then there is a pretty obvious question that you should be asking yourself.
I'm an American. I love this country and the freedoms that we used to have.
First we loose the cocoa, then the sorghum and rice, lastly the corn, then humanity suffocates in the overabundance of nitrogen, oxygen deficient atmosphere.
It seems to me like this problem will eventually cause people to look into ways to automate the bean picking process, and remove much of the labor-intensiveness?
It's not like this hasn't been an issue before with other crops.... I get the idea that the only reason this has been done with all the manual labor for so long is geography. The beans are grown primarily in places where labor is dirt cheap.
Paying the farmers more will happen naturally if chocolate gets too scarce. (Companies intent on making cheap candy will use very little cacao in whatever they sell, and those interested in really good chocolate candy will up the price.) But those with a vested interest in getting large supplies of cacao beans at as low a price as possible will probably invest in technology to harvest them more efficiently. Get directly involved in the process, opening up farming operations using the machinery -- and you've got your own supplier that you own and control. Not a bad solution, really -- and will bring costs back down again.
pollarda, I'm posting as AC to avoid losing the mod points I've voted you up with (first time I've done that BTW)...
Just wanted to say thanks! Your posts have been extremely informative. I've never been a chocolate "snob" myself (apologies for the somewhat pejorative term), and although I've known a few, they haven't been able to paint the industry in a different light in the way you've been able to do for as all here. You've certainly given me (for one) something to think about.
You've also completely avoided using this topic as an opportunity for advertising your own company. As much as I sincerely appreciate that... may I ask specifically what the name of your company is, and whether or not they offer online sales? Your contributions to this topic certainly entitle you to some free advertising IMO!
I've got a solution: boat lift from Mexico and Central America.
(before you get excited, it'll never happen; for political reasons Puerto Rico can't get enough labor to harvest coffee, and it's right nearby... a boat lift to the Ivory Coast is way too expensive)
Nothing Mars Inc. makes actually has Cocoa in it. It's nothing but vegetable oil, milk solids, carageenan, natural and artificial cocoa flavoring, and other artificial bullshit.
Why do you think the Chocolate industry has been lobbying every year to reduce the amount of cocoa and still be able to legally call it chocolate. American industry will do what it has always done. Added more fillers and extenders in order to increase profits at the cost of flavour.
It can be correctly assumed that nearly everyone here has enough post-secondary education so as to eschew and disparage this thing called the price mechanism precisely because it does not involve government meddling. Let it work, Science damn it!
Just a quick note to say thanks for your comments in this thread. Fascinating to learn some more about the chocolate industry and what the hell chocolate is. As an Australian that recently moved to the US I have been surprised about the weird tasting chocolate that is commonly available (e.g., Hershey bars) and now have a better idea what to look for.
Would love to know what you make so I can look out for it in the stores (... if there's anywhere in Ohio that stocks them!)
Someone should check for clogged pipes at the chocolate factory, duh.
I read somewhere (I lost the source) that one solution being worked on is to develop a new variety of the cacao tree that is more productive. Seems there has been some success in that except that the cocoa produced by the new trees tastes like crap. Like tomatoes and corn, expect the new variety to displace the current one resulting in a lesser quality product being accepted as "normal".
If demand is high, shouldn't the supply demand paradigm kick in and raise prices? What am I missing here?
THis is like a classic example of supply and demand. Trust me, the situation will fix itself. There will be time when those farmers will cut down banana plants and put cocoa there instead, if people will keep buying chocolate at higher prices.
It is a plant that is easily cultivated at any latitude up to 25 degrees. It is also readily cultivated in green houses if you really want to push it.
We will never run out of chocolate.
In a free market, what will happen is that prices of chocolate will go up which will both discourage consumption while increasing the rewards for production.
The system self corrects. Econ 101.
What might be in danger is the Mars business model. That might be in for a bumpy road. But chocolate itself? Absolutely fine.
I've decided to stop wasting my time responding to AC trolls/sockpuppets... so if you want a response from me... login.
Let's hope this ends the race to the bottom of price and quality.
Reality, brown food color (blood) + "natural" flavors - chocolate even cheaper.
Everyone who buys Wild Hunt will receive 16 specially prepared DLCs absolutely for free, regardless of platform.
Wait, there's chocolate in Mars bars? I'm shocked.
"I find it hard to believe that 7 years ago there was a stockpile of maybe a half a million tons of cocoa, especially as it is a perishable item."
Yeah, the truth is the cocoa stockpiles are over million tons. It's a rolling reserve, split in many places, so it gets renewed. But really, the world wide cocoa reserves are estimated at over million tons.
>the world ate roughly 70,000 metric tons more cocoa than it produced
So... where did that come from if it wasn't produced? Another World? Space? Is there a secret interstellar cocoa trade agreement and Aliens helped out with our shortage? ..... Oh, MARS!!! Now I see.
So...if..the gas industry can charge crazy prices..citing we're running out of oil...
Then we could charge a whole lot more for chocolate if we say we're running out of cocoa! GENIUS!
So last year we imported 70 000 tons of cocoa from... outside Earth ? Or are there long-term stocks of cocoa somewhere ? Because if the latter, then getting rid of those stocks year after year and moving to a tighter production chain makes a lot of sense, and fits in the trend of decreasing transaction costs. It could also be a sign that producers expect their cocoa products to sell less well in the future, or raw cocoa to become cheaper. In any case, the claims in TFA make little sense.
Maybe we deserve this world ?
Supply and demand will make the prices which will make US think twice to buy choco in case there is a shortage.
Folks, are you sooooo massively stupid you dont get this ? It appears to me there might actually be a justification for MBA schools, given all this WHINING.
Also, I work as a software engineer at a company which makes high-end consumer products. I went to school for 17 years. The payoff is about as good as quitting school after 9 years and working as a labourer in said company. I could whine all day. I do some minor whining and then I carry on.
So, choco-planters, STOP THE FUCKING WHINING. Shit is tough, do hard+smart work. Dont believe in communism and neither in the bankster lies.
Has the OP never heard of supply and demand? Wait, you don't need to answer.
They will switch to The World's Best Nougat.
http://en.wikipedia.org/wiki/Nougat
Of course the American Solution(TM) to choco shortage would be to stage some revolution somewhere and then swoop in with aircraft carriers in order to establish a Puppet Regime. Said regime will then sell the choco to Hunter Biden who will mark it up by 275% and sell it to the American end user.
So they managed to exfiltrate some money from almost everyone ?
That's LAME compared to:
1.) Make some blinking, colorful glass beads
2.) Have the glass bead transmit location and sometimes intelligence back to FtMeade and TelNof A/B
3.) Make the victims power said glass beads every night.
So, Oppenheimers made some money and the nuke bomb - now you have two Russkie Jews making "1984".
Any arguments about Russkie superiority ?
Never seen or even heard of any of those. No matter since I couldn't afford them anyway.
Craft beers have driven all beer prices up to the point I no longer drink any beer, certainly not in restaurants or non-dive bars where the cheapest crap is like $5-$8 for a glass.
Guess I'll have to give up chocolate as well, especially once you manage to price it out of just about everyone's budget.
Good luck selling your luxury goods to the 1% and their lackeys.
2/3 of my family is unemployed. The statistics being touted by politicians and companies are complete fantasy. Don't you assholes get that your supposed customers - average Americans - are either running out or completely out of money?
When we are eating more chocolate than there is produced, is it because someone invested in futures, is it because its not really chocolate, or is it just really old chocolate?
Wrong - chocolate don't hurt your teeth. It is the suger they usually mix in that is the problem.
Alarmist article from a big corporation to set the stage for loose regulations on chocolate so that the masses can keep getting their 99cents "chocolate" bars (aka hydrogenated fat with dark-brown solids, corn syrup, emulsifiers and natural flavoring agents, whatever other non-cocoa crap - tastes like cocoa) and the company's pockets full.
Dude, didn't you know about the Strategic Cocoa Reserves... underground salt domes in Texas and Louisiana that store about 112 million cubic meters of beans?
That that is is that that that that is not is not.
If we're eating more than we produce, that means we're eating stockpiled chocolate, right? Which means old chocolate bars. And we haven't noticed?
I used to wonder about the unique "Tropical Chocolate" bars we used to be issued in Vietnam. They always had a musty smell to them, but I figured it was from their unique properties (NOT to melt in hot climates) .. and of course all military rations are expected to be stored for lengthy periods of time.
The real panic won't begin until the stores (e.g., stored, stockpiled chocolate) run out.