At a popular pâtisserie in Delhi, a skilled chef deftly glazes a chocolate cake. Her skill is impeccable, yet her distress is evident — and the sweltering heat outside has little to do with it. Around 60% of the pâtisserie’s menu is chocolate-based; they get close to 60 chocolate cake orders on average a day, and their other chocolate desserts are perennial bestsellers. Even during mango or strawberry season, roughly 12-15 kg of chocolate go into their creations daily, and much of that is sourced from imported brands.
“The soaring cocoa prices globally have meant a massive hike, 110% to 200% in some cases, in the prices of our primary ingredient — chocolate,” the chef says. “We’ve already increased the prices of all our chocolate items by 5%-7%, from cakes down to a macaron. We’re trying to hike it slowly so as to not shock the customer, but our focus now is to start experimenting with more non-chocolate flavours.”
The price of cacao beans, the primary raw material for chocolate, skyrocketed to a record price per tonne in April, owing to extreme crop shortages and dangerously low liquidity on the commodities market. A combination of factors are at play. In West Africa, nations that produce the major share of the world’s cocoa beans, a bad harvest season has been brought on by adverse weather conditions, black pod disease, and ageing cacao trees. Additionally, historically inequitable market practices have left farmers with critically low incomes to replant new trees or implement disease prevention measures. The global chocolate crisis is such that top traders have forecast cocoa futures to climb significantly this year, while reports predict a global shortfall in cocoa for the 2023-24 season.
A heavy blow
In India, importers and suppliers of cocoa and chocolate brands are also facing the fallout of the war in the region. “We import cargo by sea, and with the crisis in the area, all cargo prices have shot up by 20%-30%. On top of that, the currency has weakened significantly, which has also made an impact since we buy in foreign currencies,” says a senior manager at a major supplier in the country. According to him, the prices of these products have already shot up by 50% and are expected to increase even further. “There’s a lot of volatility in the cocoa price index, and even if the prices go down today, it’ll take several months for that to reflect in India.”
For the time being, suppliers have enough stock to last another six to eight months, so there may not be an apparent shortage of chocolate in the market yet. But for professionals who deal with cocoa and chocolate daily at higher price points, the price surge is already causing heavy blows.
Home bakers have been hit too. One baker, who was excited to embark on a new journey, now finds her happiness tempered by concern. “I not only make a number of desserts with chocolate but also use it in savoury sauces. Every day, I use several kilograms of white, milk, and dark chocolate, and the price hike is impacting my cost of production,” she says. “I do not intend to remove chocolate from my menu entirely, but I definitely have to keep it to just a couple of signature items for now. Once my café launches, I may have to increase the prices of my chocolate items, reduce portion sizes, and negotiate with suppliers for better deals.”
Bitter cost of indulgence
In another part of India, a small cookie company has built a name for itself in the past few years, with almost 80% of its menu featuring chocolate in some form. “The prices of all these ingredients have gone up significantly. In fact, chocolate contains sugar and other ingredients, so the price hike isn’t as much in comparison as it is for cocoa powder or nibs that contain pure cocoa,” says the chef-owner of the business.
Panache, a 7-inch cookie with dark chocolate
For the time being, they’re bearing the losses themselves by reducing profit margins. “Our customers have come to expect a certain standard and specific flavour profiles in our cookies. Which is why we cannot reduce the chocolate content nor substitute a higher-priced cocoa ingredient for another. We will not disturb the recipes of our signatures and bestsellers, come what may,” he adds.
Prices on a roller coaster
- The price of dark chocolate has increased by nearly 50% since the beginning of the year.
- Other chocolate products have seen similarly steep price hikes.
- A variety of chocolate products from different suppliers have already seen dramatic increases, with some prices more than doubling.
Shrinkflation, skimpflation and other compromises
Chocolate producers are also resorting to covert tactics such as shrinkflation (reducing pack sizes) and incorporating more fruits and nuts. Major brands have already reduced the size of certain products, with some products now containing less chocolate than before.
Quality over all else
However, for most specialized professionals working with chocolate or cocoa products, cutting corners in terms of quality is unthinkable. “I’d much rather not have chocolate desserts in my menu at all,” says one bakery owner, expressing their commitment to quality.
The way forward seems to be pivoting to non-chocolate creations for bigger players, even those who may not be outrightly concerned about the price hike presently. At some well-known hotels, seasonality plays a key role in their menu engineering, with chocolate taking a backseat as other ingredients come to the forefront.
A selection of pastries from Lavonne
Bean to bar: the way forward?
Historically, India has been a consumer of cheap, mass-produced chocolate. However, in recent years, a bean-to-bar movement has been growing in the country, emphasizing complete control over the chocolate-making process, from sourcing or even growing their own cacao to crafting the final bar. The global price hike hasn’t spared such homegrown artisanal chocolate makers either. While they use cocoa sourced from organic farms in the cacao-growing states of India, they supplement this with cocoa from international markets.
But it’s not all cloudy on the horizon for craft chocolate makers in India. A number of these producers have created a significant international presence by focusing on quality and sustainability. And some believe the rise in cocoa prices could, in fact, be a boon for artisanal chocolate makers, as more consumers look to high-quality products. The recalibration of the market has also seen farmers planting more cacao trees. “The new plants will take three to four years to bear fruit, but you can safely expect an oversupply of cacao from India in the future,” says one farmer involved in this shift.
