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All about Cocoa
bakemag.com, August 14, 2012
by Staff

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Prices for 10% to 12% butterfat natural cocoa powder were around $1.95 to $2.05 a lb as of April 6, down about 20% from a year earlier when prices were rising to recent historical highs of $2.50 to $2.55 per lb in late April and most of May 2011. Prices have steadily declined since early September 2011 as global cocoa bean supplies have increased and cocoa/chocolate demand has been held in check by ongoing economic concerns, especially in Europe.

Global cocoa bean production increased from about 2.9 million tonnes in 2000-01 and 2001-02, to consistently around 3.6 million tonnes since 2005-06, and has ranged from 3.4 million to 4.3 million from 2005-06 to present. Global cocoa bean grind, on which use/demand are based, also averages around 3.5 million tonnes. Thus, on any given year there may be a surplus (production greater than grind), or a deficit (grind greater than production). But there also is a carryover of about 1,500,000 tonnes of cocoa bean stocks from year to year — or 45% to 50% of annual production.

Black cocoa powder continues to be in greatest demand with the tightest supplies. One factor is the use of black powder in Oreo cookies. The fairly recent introduction of Oreos into India has in part spurred global demand for black powder.

The majority (about 70–75%) of the world’s cocoa beans are grown in tropical areas in West Africa. Other areas include Asia/Oceana (13–17%) and South/Central Americas (12–15%).

About 35% of the world’s supply comes from the Ivory Coast, followed by about 20% from Ghana, with Nigeria and Cameroon also key producers (about 6% each). Indonesia produces from 10% to 15%, Brazil about 5% and Ecuador about 4%.

Europe is the primary cocoa bean grinding region of the world, using about 1.3 million tonnes annually. North American grind (US, Canada and Mexico) pales in comparison at roughly 450,000 tonnes. Malaysia also has become a key region for cocoa grind, mostly supplying the growing Chinese and Indian markets, which are expected to account for the bulk of cocoa/chocolate demand growth in coming years. There also has been a significant increase in “origin” grinding, or processing cocoa beans in the country of origin so they can capitalize the higher value products (powder and butter versus beans).

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