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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 prices rise, people have larger incentive to grow cacao. I'm failing to see what the issue here is.
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.
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Keep in mind that a 3 Musketeers bar is mostly sugar. There isn't much chocolate in it at all. There is just a thin shell of chocolate on the outside (predominately). That chocolate is very sweet. I'd bet it contains no more than 20-30% cocoa. (Our milk chocolate is 35% cocoa which is higher than most.) Most of the rest is sugar. (There is some cocoa butter which sells now for about $4.70/lb as the market is up for cocoa butter right now -- conversely to powder which is down as they move inversely to each other for reasons I've never quite understood.)
This is one thing we have a hard time communicating to chefs. They don't always understand that very good quality chocolate is a lot more affordable than they think. The price per pound is higher -- sometimes a lot higher. At the same time, there often is very little chocolate in the chocolate dessert once you've added flour, eggs, milk, cream, sugar, etc. So they can improve the quality of their dessert --- sometimes significantly -- without as much added price as you'd normally think since the chocolate is diluted by so many other ingredients.
Part of the problem is that there is a mindset that cocoa and chocolate are commodities in the same way that flour and sugar are rather than heavily labor intensive products that should be compared more closely to truffles, vanilla, fine cheeses, etc.all of which are typically carefully handcrafted products in much the same way that cocoa is.
About the locally produced bar -- As I said, you can't make good quality chocolate without good quality cocoa. You can't get good quality cocoa without paying the farmers significantly more. Hence you can not have a "cheap" high quality chocolate where the farmers were paid well. This doesn't always mean that an expensive bar is made with chocolate where the farmers were paid fairly for their cocoa. We all can think of products that were way overpriced for crap. So in general you can have overly priced bad quality chocolate but you can't have under priced good quality chocolate simply because good quality beans are expensive. Pay attention to the quality --- not the price. The price though will follow the quality.
I agree. Chocolate was once the domain of the rich and while Milton Hershey commoditized it by adding immense amounts of sugar and milk, I feel convinced it will some day become a specialty product once again that is more of a rare treat rather than the everyday snack.
Here is how it works in terms of labor:
The cocoa trees are highly disease susceptible so there is a lot more work that goes into keeping your cocoa plantation in good shape than say apples or oranges. There is a production of about 1MT / acre of cocoa per year so the land doesn't produce very much per acre as you might expect. Not all the cocoa comes into ripeness at the same time (unlike apples, oranges, etc.) so the farmer has to walk the plantation every few days harvesting each cocoa pod by hand one at a time as each pod becomes ripe. Each cocoa pod equates to about one chocolate bar and must be hand cut from the tree (not picked). The pods are then taken to a central area where they are split by hand and the beans removed and the central stalk taken out again all by hand. The beans are then put into wooden fermentation boxes (3 foot square) where they are fermented typically 5-7 days depending on variety. Each day the beans must be taken out of the boxes, clumps broken up and\ turned over, and then put back in so that they ferment rather than rot. Finally, they must be dried which takes another 5-7 days where they are put out in the sun in the morning and brought back in when it looks like it might rain or in the evening. Some farmers turn the beans every hour. The final price? $1.30/lb Let's look at pecans. The trees are a lot easier to grow, very disease resistant (comparatively) and they are harvested by a vehicle driving up to the tree, grabbing it and shaking it until all the pecans fall out and then they go to the next tree. The price? $4.50/lb if I buy it 1,000/lbs at a time.
Given the labor economics, the amount of cocoa will reduce until the price of the chocolate goes up enough to support higher prices for the farmers. This will happen whether we like it or not. This will also continue to happen as the 3rd world countries industrialize and less labor intensive forms of jobs are available such as working oil fields, mines, and other blue collar and white collar jobs in the various cities.
Probably the best widely available chocolate would be Guittard. Guittard is run by Gary Guittard and it was started by his great grandfather in San Francisco during the gold rush. I'm personally good friends with Gary and I know where they buy their beans (not all of them but enough so that I have a good sense as to what is paid and we buy from some of the same farmers.) Guittard buys some very premium cocoas (and some lower grade too.) For their premium cocoas, they pay premium prices. Gary (along with myself) are founding members of Direct Cacao an organization that was set up to promote the direct trade of cocoa with the farmers to help ensure that farmers get paid enough to keep cocoa a viable crop and to help keep quality up.
Lindt actually owns Ghiraldelli which is funny. When you buy San Francisco Chocolate, you are actually buying swiss. I'm familiar where they get some of their beans and their beans generally aren't particularly good quality. Their Madagascar chocolate is made with some of the lowest quality cocoas from Madagascar for example -- they couldn't buy their cocoa from the better growers for example Akkeson's plantation where we, Valrhona, and many of the europoean manufacturers buy their cocoa from.
Chocolate brands to look out for would be IMHO: Michel Cluizel, Pralus, Amedei, Domori, Valrhona (though they don't us as good cocoa as they used to). In the US, I'd look at companies such as Guittard (the big one) and smaller ones such as Amano, Theo, Patric, Rogue, Dandelion, Askinosie, Taza, Ritual, Dick Taylor, Fresco, Patomic, etc. There is a new movement in the US for craft chocolate making much in the same way the beer industry went a few years ago. These companies (and others) are at the forefront and many of their owners truly care about what they are doing and the farmers they work with. Among many of these companies is the desire to be part of the solution rather than part of the problem. I've been immensely proud to hear how the owners all want to pay the farmers more. Gary Guittard in one of our Direct Cacao meetings got up and specifically said: "We all need to pay even more to the farmers." I was so proud to be part of a movement where this was being said. The biggest hurdle is to educate the public so that chocolate isn't seen as just another commodity so that the public is willing to pay enough that we can pass that along to the farmers as we would like.
There isn't much monopoly that I've ever seen. There are some huge chocolate traders and companies out there. Many have the resources to create hedges so that the market doesn't affect them in the same way it does smaller producers. However, the chocolate business is pretty competitive. There are many brokers and in country cocoa traders. If one cocoa trader isn't paying the farmers as much as another, the farmers will switch. The farmers are typically poor so they don't feel as tied to loyalty as they might otherwise and they follow the price paid. The bigger problem is simply that Hershey's (as an example) has a low-end chocolate bar that they have to run all the ingredients and final products through the supply chain all to have a bar that is $1.00 (or so --- I don't keep track of their price as I don't eat the stuff) by the time it reaches the final customer. This means that they can only offer a price so high to make the numbers work.
So it is about educating the customer so that they will pay more. We (as a company) try to help educate the farmers and help them increase the quality of their cocoa. (Most of the world's cocoa is amazingly poor quality). If the farmers increase the quality of their cocoa, they can charge more. Hopefully, we will get to buy it when they do improve the quality. With good quality cocoa, the farmers can always charge less if they choose or if they have to. With poor quality cocoa, they can never charge more. Quality provides options for the farmers and in my experience really helps improve the self image of the farmers which is an amazing thing to see.
My focus as a chocolate maker is about quality. If you want to produce a quality product (as opposed to a low priced product), you have to be willing to pay what it takes to get the ingredients, materials, and skills that it takes to get it to all happen. Not everything about being a capitalist is about paying the very least -- it is about paying what it takes to get what you want. If you overpay, you are out of business. If you underpay, you won't get what you need and your product will probably suck one or more ways. That is just how the world works.
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.
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