Cocoa Ingredients Market Analysis

Global Cocoa Ingredients Market Overview

Cocoa Ingredients Market is projected to register a CAGR of 4.45% and reach a value of USD 19,737.5 million by 2028. Cocoa ingredients are derivatives of cocoa beans and are used widely for various purposes. Cocoa ingredients come in several forms which include cocoa powder, cocoa liquor, and cocoa butter. Cocoa ingredients are found in two categories such as conventional and organic. 

The primary application of cocoa ingredients is found in chocolates as key cocoa-based confectionery ingredient. Apart from the confectioneries, cocoa ingredients find massive application in baked products, dairy & frozen desserts, beverages, dips, sauces & dressings, and among others. Few of the significant reasons for the growth of the global cocoa ingredients market are creative packaging and increasing popularity of chocolate for gifting purpose followed by potential demand of chocolate from various industries. Moreover, growing demand for health & wellness products and growing demand for natural food ingredients are expected to be prime opportunities for market players. However, rising incidence of obesity and other health concerns, fluctuating prices, and increasing health consciousness among consumers expected to hamper the growth of global cocoa ingredients market during the years to come. 

COVID-19 Impact Analysis

The rapid proliferation of the COVID-19 pandemic has resulted in a global crisis. Impacting over 195 countries, the pandemic has already created an economic downfall worldwide. The global pandemic is deemed to create a chaotic environment, resulting in a global recession. With the rapidly increasing number of cases, the global cocoa ingredients market is getting affected in many ways.

Cocoa ingredients are made from cocoa beans. Cocoa beans are the key ingredient in the manufacturing of cocoa ingredients. These are processed in factory settings to obtain cocoa ingredients such as cocoa powder, cocoa butter, and cocoa liquor. With barriers to cross-border transportation of commodities due to the pandemic, the cocoa ingredients manufacturers have become dependent on the local raw materials suppliers, increasing the bargaining power of suppliers. The outbreak of the COVID-19 pandemic and the subsequent adoption of lockdown strategies in many countries restricted the availability of labor to carry out the production process. Moreover, the lockdowns also affected the transportation industry, hampering the supply of key raw materials. Thus, the limited availability of labor and key raw materials harmed the overall production of cocoa ingredients across the world.

Market Dynamics

The global cocoa ingredients market has witnessed a significant growth rate over the last few years and is projected to register a 4.45% CAGR during the forecast period. Various factors are driving the growth of the market. Exponentially growing chocolate sales worldwide is expected to be the major factor driving the global cocoa ingredients market. Moreover, the increasing popularity of chocolate for gifting purposes, growing demand for healthy ingredients in chocolate products, and creative packaging fuel the market growth. However, the rising incidence of obesity and other health concerns slows down market growth. Market players are witnessing several growth opportunities due to growing demand for health & wellness products and inclination towards organic products. Increasing health consciousness among consumers is a major challenge faced by the producers of cocoa ingredients across the globe.

• Potential Demand of Chocolates from Various Industries

The global consumption and demand for chocolate are growing steadily. The demand for chocolates for bakery and confectionery-based applications is increasing exponentially. Increasing disposable income backed up by developing economies in countries such as India, China, and Brazil is anticipated to fuel chocolates. Chocolate has high application in a wide range of sectors, including bakery, confectionery, desserts, seasoning, and others. Furthermore, health-benefiting applications of cocoa ingredients are also fueling the demand. Cocoa butter, cocoa solids, and chocolate are rich sources of antioxidants. Furthermore, epidemiological studies show an inverse association between the consumption of cocoa and the risk of cardiovascular disease. Thus, the increasing pharmaceutical applications of cocoa ingredients are showing promising potential wherein these ingredients are increasingly incorporated in the medical formulations targeting gastrointestinal disorders and heart health

• Fluctuating Prices

The cocoa bean is the major raw material required for the production of cocoa ingredients. The price of cocoa affects the cost of production and pricing. The price of cocoa beans has been fluctuating over the past five years. Average cocoa prices have increased for two consecutive years from USD 2.44 per kg in 2013 to USD 3.14 per kg in 2015. However, since 2015, the prices have declined with a sharp reduction of 30% in 2017 over 2016. The price of cocoa beans is volatile as production is greatly affected by weather conditions, and most growers are concentrated in certain regions of the world. Moreover, there are numerous cocoa suppliers in the market, which adds to the volatility, affecting the production of chocolate products. The fluctuation in prices has led to the increased cost of production, thereby affecting the profit margins and creating an environment of uncertainty for the manufacturers of cocoa ingredients

• Growing Demand for Health & Wellness Products

Increasing consumer preference for fat-free and healthy food products has encouraged chocolate manufacturers to include healthy ingredients in chocolates in addition to the traditional cocoa as the main ingredient. Food items containing trans-fat are losing market share to low calorie & low-fat products as trans-fat is linked to cardiovascular diseases. Considering the facts, the major chocolate companies are tapping into consumers’ growing health and wellness concerns by improving the nutritional profile of their chocolate portfolio. The opportunity remains higher for cocoa ingredients as they contain numerous nutrition content, which is one of the important factors driving the sales at present and is expected in the future.

Segmentations

By Product Type

Based on product type, the global cocoa ingredients market has been segregated into cocoa powder, cocoa liquor, and cocoa butter. The cocoa powder segment accounted for the largest market share in 2020, whereas the cocoa liquid segment is expected to record the highest CAGR of 4.68% during the forecast period.

By Category

In terms of the category, the global cocoa ingredients market has been divided into conventional and organic. The conventional segment accounted for the largest market share in 2020, whereas organic cocoa segment is projected to exhibit a higher CAGR of 5.0% during the forecast period.

By Application

Based on application, the global cocoa ingredients market has been divided into bakery & confectionery, beverages, dairy & frozen desserts, sweet & savory snacks, dips, sauces, & dressings, and others. The bakery & confectionery segment accounted for a larger market share of 46.54% in 2020 and is expected to register a CAGR of 4.45% during the forecast period.

Global Cocoa Ingredients Market Share, by Region, 2020 (%)Sources: MRFR Analysis 

Regional Analysis

By region, the global cocoa ingredients market has been divided into North America, Europe, Asia-Pacific, South America and the Middle East & AFrica. Europe accounted for the largest market share of 31.10% in 2020. Asia Pacific was the second-largest market in 2020 and is projected to exhibit a CAGR of 4.75% during the review period. The market in the North America is expected to register the CAGR of 4.28% during the forecast period.

Europe

Asia-Pacific is one of the most lucrative regions among the manufacturers of cocoa ingredients. It accounted for a 31.10% market proportion in the global cocoa ingredients market. The market in the region is projected to expand a CAGR of 4.35% during the forecast period. Europe is the world's largest manufacturer of chocolate. This region houses confectionery production plants of several multinational companies such as Nestle S.A., Mondelez International, Inc., Mars, Incorporated, Lindt & Sprüngli AG, and Ferrero SA. These large confectionery companies majorly drive the consumption of cocoa ingredients in the Europe region. Also, rising consumer demand for natural ingredients in the food application for flavoring boosts the sales of cocoa ingredients. Moreover, Europe is among the key markets for personal care and cosmetics production, which further contributes to the growth of the cocoa ingredients market in Europe.

Asia-Pacific

Asia-Pacific accounted for 26.88% of the global cocoa ingredients market in 2020 and is projected to expand at a 4.75% CAGR during the forecast period. Increasing the use of cocoa in snack food and beverages in Asia-Pacific boosts the market growth. Indonesia is also among the key contributor to the growth of cocoa ingredients in this region. Many cocoa companies such as Olam, Musim Mas, and Barry Callebaut have significant acreage plantations in Indonesia. The key players take several initiatives to boost the market growth. For instance, in April 2021, Mondelēz International, Inc. and Olam Food Ingredients collaborated in Indonesia to create the world's single largest sustainable commercial cocoa farm. Many end-use manufacturers are launching chocolate-flavored products in the market owing to high consumer demand. Also, rising disposable income, improved retail distribution, and the growing availability of international brands in the emerging countries is driving the growth of the cocoa ingredients market in the region. 

Competitive Landscape

The market comprises tier-1, tier-2, and local players. The tier-1 and tier-2 players have reach across the globe with diverse product portfolios. Companies such as Archer Daniels Midland Company, Barry Callebaut, The Hershey Company, Puratos Group, and Ferrero SpA dominate the global market due to brand reputation, product differentiation, financial stability, strategic developments, and diversified regional presence. The players are focused on investing in research and development. Furthermore, they adopt strategic growth initiatives, such as expansion, product launches, joint ventures, and partnerships, to strengthen their market position and capture a large customer base.

Prominent players in the global cocoa ingredients market include Archer Daniels Midland Company (US), Barry Callebaut (Switzerland), Olam International Ltd. (Singapore), Nestlé S.A. (Switzerland), Mondelēz International Inc (US), The Hershey Company (US), Ferrero SPA (Luxembourg), Chocoladefabriken Lindt & Sprüngli AG (Zürich), SunOpta Inc. (US), and Puratos Group (Belgium).

Recent Developments

Few developments that occurred in recent times influencing the market growth of cocoa ingredients are listed below:

• Barry Callebaut: In 2022, they launched a new ruby chocolate compound targeting convenience applications like bakery and ice cream. This exemplifies their focus on product innovation.

• In November 2021, Archer Daniels Midland Company (ADM) acquired Deerland Probiotics & Enzymes. The acquisition will help to strengthen ADM’s innovation leadership in dietary supplements and functional foods.


• In November 2021, The Ferrero Group (“Ferrero”) announced a definitive agreement pursuant to which it will acquire the remaining shares of Ice Cream Factory Comaker and relevant group companies (ICFC), an ice cream manufacturer.


• In September 2021, Barry Callebaut acquired the Europe Chocolate Company in Belgium with the aim of supplying a range of highly customised chocolate specialties and decorations to a variety of customers.


• In Jnauary 2021, Puratos Group acquired Ruskhleb with the aim of extend its offering of local sourdoughs and allow more bakers in Russia to capitalize on growing consumer demand.


• In May 2021, Mondelez India launched an all-new product innovation – Cadbury Oreo Milkshake Mix. The company launched products like Cadbury Dairy Milk Silk Oreo, Cadbury Dairy Milk in Lickables, Oreo Cadbury Dipped, etc. Through this launch, the company provides its customers a uniquely luxurious experience, which combines the best of both worlds.

Scope of the Report

Global Cocoa Ingredients Market, by Product Type

• Cocoa Powder


• Cocoa Liquor


• Cocoa Butter

Global Cocoa Ingredients Market, by Category

• Conventional


• Organic

Global Cocoa Ingredients Market, by Application

• Bakery & Confectionery


• Beverages


• Dairy & Frozen Desserts


• Sweet & Savory Snacks


• Dips, Sauces, & Dressings


• Others

Global Cocoa Ingredients Market, by Region

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  • Mexico
  
  
  
  


• Europe
  
  
  
  • UK
  
  
  • Germany
  
  
  • France
  
  
  • Spain
  
  
  • Italy
  
  
  • Belgium
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • China
  
  
  • India
  
  
  • Japan
  
  
  • Australia & New Zealand
  
  
  • Malaysia
  
  
  • Indonesia
  
  
  • Thailand
  
  
  • Rest of Asia-Pacific
  
  
  
  


• South America
  
  
  
  • Brazil
  
  
  • Argentina
  
  
  • Rest of South America
  
  
  
  


• Middle East & Africa
  
  
  
  • GCC Countries
  
  
  • South Africa
  
  
  • Rest of Middle East & Africa
  
  
  
  

Intended Audience

• Cocoa ingredients Manufacturers


• Chooclates Manufacturers


• Bakery & Confectionary Manufacturers


• Beverages Manufacturers


• Raw Material Suppliers


• Retailers, Wholesalers, and Distributors


• Governments, Associations, and Industrial Bodies


• Investors and Trade Experts