CHOCOLATE RENAISSANCEBack to the flavors

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CONTENT

Chocolate numbers

Varieties

Flavors and sensations

Hacking chocolate or “Bean 2 Bar”

Coming next 2

CHOCOLATE NUMBERS

World market - US$ 83.2 Billions in 2010, to be US$ 98.3 Billions in 2016 - 2.7 % yearly growth. (Filmed entertainment $ 88 B; Consumer Electronics $289 B)

Americans consumed 3 Billions Pounds (1.6 Billions Tons) of chocolate for $13.1 Billion in 2001 Non chocolate candy products = $ 7.6 B

71% of Americans prefer Milk chocolate - 4 Billion ton of beans harvest in 2013

A 1500 year old business, at least

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WHO EATS IT?

Europeans

16 of the top 20 consumers per capita

GER, Swiss, UK are top with approx. 10kg/head/year

All Americans

Others

Overall consumption trend is a yearly 2-5 % increase3.3% on average over last 10 years

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WHAT DO THEY EAT?

Milk far ahead, then filled chocolate

Large differences (Belgium)

FDA White chocolate:At least 20% cacao butter/fat and 14% dried milk. - 55% sugar MAXIMUM

FDA Milk chocolate10% chocolate liquor minimum12% dried milk minimumFat must be from cacao bean (butter)

5Dark chocolate

WHERE IS CACAO COMING FROM?

3/4 come from Africa (40% Ivory Coast alone)

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CONCENTRATION OF PRODUCERS

In 10 years

Africa 69 to 72%

America 14%

Asia 17 to 15%

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CACAO PRICE 2002/2012Variations between $ 1,361 to $ 3,730 / Ton

• Prices barely kept pace with inflation in buyer’s markets

• No visible impact of social initiatives

• Price increase due to higher demand • Bulk buying remains king

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COCOA CLASSIFICATION

Bulk - Uncertified, no guarantee of variety, ripeness, fertilizer, fermentation level etc..

Commodity price - Approx. $ 2.25/Kg

Certified: By one or more certifying body usually focused on one specific characteristic (organic, fair, no-children slavery etc.) This guarantees the certified component but does not necessarily guarantee variety, quality or taste.

Improved commodity price - $ 2.5 to $ 3.5/Kg

Fine flavor (high quality): Guarantees of variety, origin, processes and taste. But not necessarily clear on other criteria.

Negotiated price well above commodity price. Up to $ 20/Kg9

GLOBAL GROWTH

• Certified segments growing faster than overall production

• Fine flavor steady in volume, grows in value

• Volume and value growth in bulk

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BIGGEST BULK BUYERS

Large multinational companies with worldwide sales

High level of concentration

No reference to cacao quality

Top 10 chocolate/candy companiesBilling in US$ M Brand Country

Mondelez (ex-Krafts food)

19.965 Toblorone, Cadbury

US

Mars 16.200 Mars, Twix, Bounty

US

Nestle 12.808 Kit Kat, Smarties

CH

Ferrrero Spo 9.612 Nutella IT

Hershey’s 6.112 Hershey’s bars US

Lindt 2.796 CH

August Storck 2.205 Merci, Original GR

Yildiz 2.095 Godiva, TUR

Meiji Co. 1.791 JAP

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BEAN VARIETY

The “historic” classification

Criollo - Originally from Central America, Criollos dominated the market until the mid 17th. There may not be any “pure” Criollo trees left. ~ 6% of world production

Forasteros - Originally from the Upper Amazon region, the appellation covers a large group of cultivated, semi-wild and wild sub-varieties. They include Comum in Brazil, West African Amelonado (Africa), Nacional (Ecuador),Matina or Ceylan in Costa Rica and Mexico. Hybrids from the Upper Amazon region are widely used in large plantations worldwide. ~ 82% of world production

Trinatario - Considered part of the Forasteros family, are a cross of Criollo and Forastero started unintentionally in Trinidad after the 1727 “blast” destroyed the original Criollo trees. Currently present in Venezuela, Ecuador, Cameroon, Samoa, Sri Lanka, Java and Papua New Guinea. ~ 12% of world production

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THE DNA CLASSIFICATION10 DNS identified strains (USDA, Mars - Motomayor study 2008)

Cluster Outside Inside Flavor Comments

Amelonado Melon shape, thick skin, shallow ridges, round tip

greenish seeds

Earthy cocoa, leather, wood, bitter

Close to the Guina. Used to be important in West Africa

Contamana Oblongue, rugby ball shape purple-ish seeds

Floral, complex fruity Witch broom resistant, widely cross bred

Criollo Round and oblongue shape with moon-like surface redish seeds

Very fruity and complex aromas with

fine acidity

Pre-Columbian strain with extra qualities but weak and

short yield Curaray

Guiana Small size and yield. Earthy and strong cacao flavor

High fat and high caffeine content,

Iquitos

Maranon Close to the Ecuadorian “Nacional”

Nacional Orange colored avocado shaped pod

Very dark seeds

Fruity and floral including red fruits,

berries. No bitterness

Very fine quality originally form the foot hills of the Andes in Peru and now

mostly in Southern EcuadorNanayPurus

Source

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37 “CULTIVARS” -

Amazonas - Bahia- Cacao Monka - Canoabo - Carenero - Catongo - Caucano -CCN-51 - CCRP - Ceylan - Chuao - Chuno - Comum - Cumboto - Cuyagua - EET - Esmeraldas - Guasare - ICS - IMC 67 - Indio Rojo - Java - La Red - Maracaibo - Matina - Merideño - Nicaliso - Ocumare - Pajarito - Pandora - Perija -Playa Alta - Porcelana - Rio Caribe - Sur Del Lago - Theobahia -Trinitario

CCN-51 = Coleccion Castro Naranjal 51 (1965) Guayaquil (Ecuador)CCRP = Cadbury Cocao Research Project (1979) OceaniaEET = Estacion Experimental Tropical (1950’s) Ecuador Some are “Fino Aroma”ICS = Imperial College Selections IMC 67 = Iquitos Mixed Calabacillo (1930’s) based on Maranon fromPeru

Source http://www.c-spot.com/atlas

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CERTIFICATIONS

Fairtrade

Rainforest Alliance

UTZ Certified

Many others

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WHAT’S IN A BEAN?

Variances exist depending on varieties

Polyphenols contains the “Flavonoids”

Average Component %

Oleic acid 18Shearic acid 18Palmitic acid 14

Other fat 3Carbohydrates 31

Protein 11Polyphenols 3

Minerals 1Total 100

Cacao butter ~ 54%

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CACAO PRODUCTION / GROWING

Select the variety

Seed and transplant

Protect

Harvest

Ferment 3 to 8 days

Dry

Bag

Ship17

CHOCOLATE PRODUCTION

Processes made by all chocolate makers, including large firms and bean 2 barEx. Hershey’s, Amano, Potomac chocolate or Nestle etc..

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Not needed if you don’t want cacao powder

Depends on the maker’s private recipe

FLAVORS & SENSATIONS

Humans have 8,000 taste buds scattered over the tongue capable of perceiving salty, bitter, sour, sweet and umami (Meat) sensations

Each bud has a matching sensor in the brain (Columbia University)

The brain interpretation forms the taste.

Taste is a “holistic” sensation - Square chocolates do not taste the same as round ones

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CHOCOLATE FLAVORS

Many aromas

Inspired by wine tasting

6 to 7 main aroma groups

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FLAVOR AND VARIETIES

Traditional / “old” vision

Criollos are fruity and great - High quality. About 7% of world production

Forasteros are acidic and rugged - Low quality. About 85% of world production

Trinatarios are close to Criollos - about 8% of world production

Translates into : South American beans are great, African beans are low quality, Asian beans are middle ground - NOT QUITE TRUE

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WHERE IS FLAVOR FROM?

50% comes from genetics, i.e the bean variety

30% from the processes,

20 % “terroir” e.i. location, soil, weather etc.

Fermentation, roasting and conching are the key flavor-forming steps

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Approximated percentages

YIELD VERSUS FLAVOR ?

Criollo yield ~ 1 to 1.5 Ton per hectare

“Fino de aroma” + Certified + custom

Susceptible to desease

CCN-51 ~ 4 to 6 Tons per hectares

Desease resistant

No questions asked23

GOURMET CHOCOLATE EXPLODES!

In 2013 global chocolate market grew by 3.4% while first gourmet chocolate maker, Barry Caillebaut grew by 19.3% in volume and 21.4%in value (http://www.reuters.com/article/2014/01/15/us-barrycallebaut-results-idUSBREA0E0IU20140115)

In 2013 - 20% of chocolate sales worldwide in “Dark chocolate”, and growing - a 93% growth over 2010 (KPMG Report)

There are 22 “Salon du chocolat” (totaling over 3 million visitors worldwide) plus countless conferences worldwide, totaling millions more.

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HACKING CHOCOLATE?

Passionate chocolate lovers

Dissatisfaction with existing products

Bean quality, sugar, grower’s treatment etc.

Low cost tools, DIY and the Internet

Wet grinders, small tempering tools etc.

Web communities - thechocolatelife.com ; chocolatealchemy.com; www.homechocolatefactory.com etc.

New suppliers cocoatown, cacaocucina, brooklyncacao etc.

Affluent buyers25

HACKING CHOCOLATE?

Quality oriented - Meticulous bean sourcing - Small batches (Starting 20lb) - Creative flavors - Creative marketing

59 Bean 2 bar makers in the US, (25% in CA) http://ultimatechocolateblog.blogspot.com

Very small to semi-industrial

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THE NEW CONSUMER

Hybrid consumer - Luxury & Quality seeker,

Daily luxury versus volume eater

Life style choice

Dark chocolate perceived as quality

The global experience , i.e the chocolate pause27

THE IRRESISTIBLE DARK INVASION

Key market 5 year evolution

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COMING NEXT

Towards a healthier Chocolate - Traceable origin, varieties, sustainable, fair etc..

“Customization” from small newcomers will be expanded by big players

Innovation via digital revolution in making new shapes and sensations

Sustainability and productivity in the field are main issues

Key volume markets: Brazil, China, Colombia, India, Russia, South Africa, Turkey and Vietnam (Mondelez statement)

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