A cocoa industry that’s always on the move
A market driven by growing, changing demand
The global cocoa market is growing. Global bean production, which totalled 4.1 million tonnes (Mt) in 2011, reached 4.8 Mt last year. Almost 75% of it is concentrated in West Africa and in particular in two countries: Côte d'Ivoire and Ghana.
This production is driven by global demand in a market that has undergone marked changes in recent years.
On the one hand, Asia is now a key player with a growth rate of chocolate consumption of more than 10% per year. This continent is also becoming a major centre for bean grinding, behind Europe but ahead of Africa.
On the other hand, consumption in developed countries is shifting towards premium chocolates, requiring the importation of fine cocoa in greater quantities. This currently accounts for just 8% of the global market, but is expected to grow.
In Europe, the Netherlands dominates the sector with more than 500 000 tonnes of beans being ground each year. France remains an important player, with chocolate production (semi-finished and finished products) of nearly 730 000 tons, of which 57% is exported. The French are also regular consumers of chocolate, ranked 6th in the world (7.3kg/inhabitant/year).
But a market that has experienced notable tensions since 2019
Strong global demand is creating market tensions, which intensified in the summer of 2019 following the decision by the two main producing countries (Côte d’Ivoire and Ghana) to impose a premium of $400/tonne on beans sold, with the aim of better paying their growers.
As a result, prices rose sharply in 2019. The forecasts in early March 2020 of the International Cocoa Organisation (ICCO) announcing a likely shortage of beans on the world market this year, assume that these tensions will increase. Indeed, despite an announced increase in production to 4.82 Mt of beans, consumption is expected to remain above production.
However, the global health crisis has had a variety of market impacts that could alter these forecasts.
On the supply side, despite some difficulties in transporting them to Ivorian and Ghanaian ports, the bean supply chain has not suffered major disruption. Financial aid is also being provided to bean producers, notably by the Ivorian government.
On the demand side, sales of consumer chocolates were driven by episodes of lockdown in developed countries, while artisan chocolatiers saw their sales decline sharply. Consumption has also changed in different ways around the world, with a decline in grinding in North America and Asia in the first quarter of 2020, whereas Europe announced a slight increase in grinding.
Prices have fluctuated a lot. As a result, uncertainty about demand led to a sharp drop in prices at the beginning of March, but thanks to its support, they then rose again. In May, the climatic impacts, and in particular the very low rainfall in Côte d'Ivoire, pushed up prices again, returning to pre-crisis levels at the end of May.
In the first quarter, the cocoa market weathered the crisis better than many other industrial sectors, although the situation remains uncertain for the second quarter.
The role of shipping in the industry
Due to the concentration of bean production in just a few countries and the positioning of processing plants in many parts of the world, the transport industry - especially shipping - plays a key role in connecting the various players within the sector.
Transporting cocoa beans in conditions that preserve their technical and sanitary qualities until their processing requires flawless logistics. For example, storage and transport conditions that are too humid are detrimental to their quality. Therefore, operators pay particular attention to the logistics of these goods.
Bean transport now takes place mainly by containers loaded with bags, big bags or bulk, but some shipments are also made by bulk carriers. The volumes traded are large, with for example 1.4 Mt of beans shipped to Europe last year.
The logistics of finished products also require special know-how. Cocoa butter is transported in tankers, Isotank containers or conventional containers equipped with flexitanks.
Other products (cocoa powder, mass, or finished products) are transported much more conventionally in cartons or pallets shipped in trucks or containers.
What is the place of France and HAROPA ports in the cocoa sector?
As a producing country, France exports about 60% of its chocolate production (more than 300 000 tonnes), 86% of which is sent to European Union countries. In terms of imports, in addition to the cocoa beans needed for production, France also imports semi-finished and finished products.
In this context, HAROPA, the main entry and exit point for goods in the industry, plays a major role in the logistics flows of the sector.
For example, imports of cocoa beans through HAROPA ports, either in bulk or in containers, accounted for a total of 78 000 tonnes in 2019, mainly destined for the two major French bean processing plants (Cargill Cacao and Barry Callebaut). Nearly 180 000 tonnes of chocolate products also passed through HAROPA ports in 2019, representing a volume of 11 000 TEUs.
In total, the chocolate sector accounted for 258 000 tonnes for HAROPA ports in 2019.