getting fresh: Blommer gets bluntAs I make room on my desk for the 10-lb. dark chocolate bar (you read correctly) given to me at Blommer Chocolate Company’s commodity and purchasing seminar yesterday, I cannot help but reflect on the state of the cocoa industry, as explained by executives at the 9th annual event. (Blommer held the same seminar in Philadelphia on Oct. 9; another will take place in Union City, Calif., on Nov. 4.)
Topics of discussion included the cocoa supply situation, developments at origin, differentials, social responsibility, cocoa demand (grind and consumption trends), product ratios and the cocoa price model, technical analysis of the market and an update on sugar and dairy.
It was a lot take in.
Unavoidable doom and gloom was a part of the presentation, which included a staggering amount of technical analysis and chart numbers that this reporter still is trying to wrap her brain around. The recession was a dominant thread tying together the day’s focus.
Despite the economy, Blommer is doing well, thanks in part to “unforecasted demand,” reported President and Chief Operating Officer Peter Blommer. As a result, the company’s plants are “running full out.” As mentioned in a recent issue of Candy Industry, “chocolate features prominently in new product introductions,” he added, which helps. So does the strong “connection between the consumer and the brand of chocolate.” In short, Blommer is about 4% ahead of plan (June-September), which may or may not be indicative of the industry as a whole, the coo pointed out.
Regardless, “we’re lucky to be in the chocolate business and not selling cars,” he asserted.
Sustainability was another thread in the daylong seminar. For example, Blommer recently announced a partnership with the Rainforest Alliance to bring certified, sustainable cocoa to the industry while benefiting cocoa farmers. And as reported in last week’s sweet & healthy eNewsletter, Blommer is one of several companies participating in a new Cocoa Livelihoods Program in Ghana, funded by the Bill & Melinda Gates Foundation.
After all, the chocolate industry is dependent on the production of cocoa trees and their pods, which contain much-needed cocoa beans. Nearly 40% of production comes from the Ivory Coast in West Africa, followed by Ghana at 21% -- but production in the latter is plateauing, according to Kip Walk, director of cocoa for Blommer and chairman of the World Cocoa Foundation. Although production in Ecuador spiked with the introduction of single-origin and high cocoa mass chocolates, it is actually a small (3%) producer of cocoa. The Ivory Coast remains the focus for cocoa suppliers.
“This part of the world is crucial for us today and probably will be for years to come,” Walk stated.
Unfortunately, issues in the Ivory Coast have driven supply down, while demand remains strong, resulting in higher prices. For example, it takes four months for a cocoa pod to fully mature, Walk explained, and while there currently is an abundance of ripe cocoa pods, there is a lack of mature trees. Thus, the last of the Ivory Coast cocoa shipments will come in February. Although better pricing for farmers is helping them to invest back in their farms, that action won’t manifest into more crops right away. Black pod disease is another problem affecting production. New techniques (at least, when it comes to cocoa) such as side-grafting are enabling farmers to recreate growth from the best of its trees.
Africa aside, Blommer also has made efforts to increase and improve production in Indonesia, which accounts for 13% of the cocoa supply. Production there is threatened by a moth called the cocoa pod borer, which was responsible for ending cocoa production in Southeast Asia in the early 1900s, Walk noted. But training programs that are teaching farmers to strengthen the cocoa pod, for example, have resulted in great improvements throughout the community, he reported, adding that the farmers (15% of which are women, interestingly enough) are “very eager to learn.”
In the end, “if a farmer can produce one metric ton (16 bags) of cocoa a year, that’s good,” Walk said.
On the demand side, said Shelia Fortune, commodity hedging manager for Blommer, the issue is grind, i.e. the conversion of beans into products. Western Europe and the Americas are the first and second leaders, respectively, in terms of grind. Worldwide, about 625 metric tons are predicted for next year for a 2.7% increase over 2009, but those numbers are down from recent years.
At retail, consumption of chocolate also is down, Fortune noted, especially for large bars. But she predicts a rebound in consumption, post-recession, including in the premium sector.
“Chocolate is recession-resistant, but not proof,” Fortune said.
As everyone knows, the prices of cocoa, sugar and milk (the key ingredients in chocolate) are up. I cannot begin to dissect the numbers presented by Blommer regarding these costs, but needless to say, they’re a concern.
Sugar production has been greatly impacted by bad beat crops as a result of poor weather conditions, explained Jeff Rasinski, director of commodities for Blommer. Although Idaho, Michigan, Minnesota and North Dakota are recovering, California is not. Mexican imports of sugar will increase in 2010 following its massive export of sugar this year (due largely to the value of the peso). Canada is one source of more affordable sugar, Rasinski pointed out, and although India is the largest consumer of sugar in the world, Brazil is the largest producer, which is not an ideal situation for the former country.
In brief, “we don’t know if this is a market that can stomach another price increase,” Rasinski stated.
As for milk, Rasinski asserts that companies should just close their eyes and buy it. As an increasing number of herds are “retired,” milk production has fallen, resulting in higher prices as well as imports of cheap butter fat, plus a lot of cash and carry; in other words, companies are simply buying and freezing butter for use when needed rather than dealing with availability and price changes.
Of all the commodities, “I’m most worried about dairy,” Rasinski summed up.
Yes, it was a lot to take in. But I appreciate the bluntness with which Blommer presented the information. (As Rasinski stated, “I wish I had better news to report.”)
I also appreciated its generosity. The next time the receptionist in my office comes to me in search of dark chocolate, her self-prescribed remedy for stress, I’ll just point her towards that 10-lb. bar of Blommer. I hope she has a chisel.
For more information about Blommer Chocolate, visit www.blommer.com.
Shigeo Hirai named World Chocolate MasterShigeo Hirai, sous chef of the Grand Hyatt Toyko, was selected World Chocolate Master 2009 by a jury of leading international chocolate professionals at the Salon du Chocolat Professionnel exhibition at Porte de Versailles in Paris.
The decision was made after three days of competition at the event, which was sponsored by Barry Callebaut. The award included a special trophy, created by leading Dutch designer Rob Verhoeven and a prize package worth 25,000 euros (about $37,500).
Second places went to Lionel Clement from the United States. Third place was awarded to Michaela Karg of Germany.
The jury, headed by President of Honor Yves Thuries, Meilleur Ouvrier de France, also gave awards for Best Praline, Best Gastronomic Chocolate Dessert and Best Chocolate Pastry as well as the International Press Award.
For more information, visit www.worldchocolatemasters.com and www.barry-callebaut.com.
Puratos introduces Cremfil SilkNew Cremfil Silk non-dairy custard cream from Puratos Corp., Cherry Hill, N.J., has a creamy silk texture that manufacturers can use in a variety of baking applications. Not only does it offer excellent sculptability, but it stays intact through the baking process, maintaining a beautiful glossy sheen. It also is suited for cold applications and boasts excellent clean-cut properties.
In addition to its bake and freeze-thaw stability, Cremfil Silk avoids excess water evaporation and provides a longer shelf-life than traditional custards.
For more information about Puratos, visit www.puratos.us.
Cadbury brand chocolate fountain hits Canadian marketplaceGiles & Posner, the company that introduced Europe to the chocolate fountain, is launching a Cadbury brand home entertainment product line that includes a range of fountains, fondues and fillers now available in stores across Canada, just in time for the holiday season.
Designed with the Cadbury chocolate lover in mind, the new range will feature the Cadbury Mini Chocolate Fountain, which requires just 400 g. of fondue chocolate to run; the Cadbury Hot Chocolate Drink Maker, which heats, melts, mixes and froths; the Cadbury Caramilk Fondue Set, which features two compartments so that a combination of fillings can be used; the Cadbury Caramilk Fondue Filter, for use on its own or with the Cadbury Caramilk Fondue Set; the Cadbury Crunchie Fondue Filter, for use on its own or with dipping products; the Cadbury Chocolate Fondue Set for up to four people, including fondue pot, chrome stand, two semicircle serving dishes, four stainless steel fondue forks and a tea light; and Cadbury 227-g. Milk & Dark Fondue Chocolate in practical 227-g. pouches.
For more information, visit www.canada.cadbury.com or www.gilesandposner.com.
Circle-K customers receive vintage Butterfinger barsNestlé USA distributed 200,000 free limited-edition vintage Butterfinger bars at participating Circle-K stores last week as part of a www.DudeWheresMyBar.com giveaway. The 1928 retro wrapper played into the alternate reality game experience on the site, which features actor Seth Green, whose Butterfinger bar is mysteriously stolen. Nearly 2,000 Circle-Ks were in on the event.
For more information about Nestlé, visit www.nestleusa.com.
sweet of the week: Amazing Grass Protein BarSan Francisco-based Amazing Grass has launched a new Chocolate Peanut Butter Protein Bar combining the antioxidant rich fruits and vegetables of their alkalizing Green SuperFood Powder with organic peanuts and whey protein. The bar offers five-plus daily servings of fruits and vegetables and contains every nutrient the body needs, except for Vitamin D, which is processed naturally from sunlight. It also boasts 12 g. of protein, 270 calories, 14 g. of omega fats, 19 g. of sugar and 28 g. of carbohydrates.
“Grass has never tasted so good,” says company co-founder Todd Habermelh. “The response so far from consumers has been phenomenal – they love the taste and texture of the bar, and the convenience it offers them in meeting their daily nutritional needs. The wheat and barley grass that we grow is harvested at the proper time, before gluten forms. So it may be a surprise to some people that all of our products, including the new Chocolate Peanut Butter Bar, are gluten-free.”
The suggested retail price per bar is $2.99. Retailers can place an order by calling 1-866-472-7711 or e-mailing firstname.lastname@example.org. For more information, visit www.amazinggrass.com.