Chocolate Confectionery Market Size, Share & COVID-19 Impact Analysis, By Type (Dark, Milk, and White), Category (Premium, Seasonal, and Everyday), and Regional Forecast, 2020-2027

The global chocolate confectionery market size was valued at USD 114.33 billion in 2019 and is projected to reach USD 136.42 billion by 2027, exhibiting a CAGR of 2.3% during the forecast period.

This market is primarily driven by evolving preferences for novel and innovative confectionery products. The origin of cocoa is becoming an important factor in consumer purchasing decisions owing to the rising concerns regarding the safety of the product due to the presence of micro-organisms such as salmonella and heavy metal traces such as cadmium and lead. The rising trend of organic and sustainably sourced chocolate has contributed to new product developments in the chocolate confectionery industry. Attractive packaging solutions, enticing sensorial appeal, and health benefits are some of the factors that are driving the chocolate products market growth.

Swift Rise in Demand for Chocolate Confectioneries Due to Stockpiling During COVID-19 Lockdown

The production and sales of chocolate items have experienced a sudden slump due to the outbreak of the COVID-19 pandemic. In the initial stages of lockdown, panic buying of food supplies by consumers contributed to the rapid growth in the sales of mainstream chocolates in retail channels as a source of indulgence and comfort. According to the U.S. Department of Agriculture, grocery store sales were up 99% in the middle of March and 25% higher on April 1^st in 2020, compared to the previous year. However, there is a swift reduction in the demand for premium chocolates amidst the pandemic wherein premium and specialty chocolate products are used seasonally and are majorly used as gifting products during travelling and festival celebrations. The trend of consuming healthy products to maintain overall health is expected to create enormous opportunities for dark & organic chocolate confectionery in forthcoming years.

LATEST TRENDS

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Technological Advancements Contribute to the Increasing Demand for Premium Chocolates

Evolving consumer preferences towards innovative & novel products has necessitated manufacturers to introduce new products in the market. New technologies for chocolate confectionery formulation along with the beneficial natural flavors and other ingredients have given rise to a new phase in this industry. Consumers are willing to spend more for premium and crafted products. Premiumization is a budding trend driving the demand for premium and luxury chocolates in developed economies. Cocoa is emerging as a healthy ingredient owing to its richness in antioxidants & minerals. Higher cocoa content is perceived to have low sugar content, ultimately flourishing the dark chocolate segment. For instance, MycoTechnology, Inc. uses mushrooms to create sweeter chocolates with less sugar. The company also claims that its technology helps in reducing the sugar content by 70% in chocolate products.

Chocolate Sales Analysis

Stockpiling Stance of Consumers Led to Rise in First Quarter Sales of Chocolate Products

Chocolate sales statistics for the recent months reveal that there is a huge rise in the purchase of chocolate items before the lockdown measures were implemented in almost all countries. Consumers have purchased chocolate snacks and other confectionery products in bulk to sustain them for the next few months. Chocolate products are also known for their stress-relieving characteristics, which had led to the sudden rise in their sales in the initial months of COVID-19 outbreak. For instance, The Hershey Company’s (one of the major players in this market) net sales stood at USD 2.037 billion in the first quarter of 2020 which is an increase of 1% compared to the same period a year ago. The company’s net sales increased by 2.2% in North America in the first quarter of 2020 due to increased buying ahead of the lockdown period. On the other hand, the company’s international and other segments’ net sales have declined by 8.1% due to the slowdown in purchases in the Chinese market as the COVID-19 pandemic impacted the country well before the other countries.

The spread of the COVID-19 pandemic and extended period of lockdowns is negatively affecting the chocolate product sales. Furthermore, the situation is leading to the disruption of the supply chains including the movement of raw materials from the producing countries to the consuming countries. The same is projected to affect the market as it will lead to higher costs to the chocolate manufacturers and increased cost of end products.

DRIVING FACTORS

Increasing Association of Chocolate with Festivals & Special Occasions to Drive  Growth

In many countries across the world, chocolates are mainly consumed and associated with seasonal festive occasions, fuelling their demand in the global market. Chocolates have become a popular dessert of religious events, special occasions such as Christmas, Easter, and others. Consumers are seeking more innovative varieties of chocolates every year. The mature markets across the world such as Australia, Canada, Russia, and others have shown notable growth in seasonal launches in the past few years. The leading manufacturers are intensively focusing on investing in research and development centers, distribution networks, and attractive packaging to capitalize on the growing demand. The growing demand for craft, customized & premium chocolates among millennials is further fueling the chocolate confectioneries market growth.

Robust Demand for Specialty Chocolate Products Supports Market Growth

The rapid escalation in demand for premium or specialty chocolates, especially in developed markets such as the U.S., France, Belgium, and Germany has been observed in recent years and an upward trend is expected in the coming years. Increased consumer preference towards knowing the origin of ingredients used in chocolate confectioneries is expected to further foster the growth of specialty chocolates. The emerging trend of clean-label and organic products to maintain overall health & wellness has increased the demand for dark & sugar-free chocolate snacks with higher cocoa content. The increasing awareness regarding labor welfare is expected to fuel the demand for fair-trade chocolate in the foreseeable years.

RESTRAINING FACTOR

Growing Awareness Regarding Health Risks Associated with Chocolate Confectioneries to Impede Market Growth

The increasing prevalence of lifestyle-related health conditions such as obesity and diabetes associated with excessive sugar consumption is having a significant impact on the chocolate industry. According to the Global Diabetes Community, U.K., it is estimated that 415 million people had diabetes in 2018 across the world and is expected to rise to 642 million people living with the disease worldwide by 2040. Diabetic patients resist the consumption of chocolates to avoid and reduce sugar intake in their daily diet. Thus, the increasing number of people suffering from health conditions such as diabetes and cardiovascular diseases is expected to dampen the overall market growth during the forecast period.

SEGMENTATION

By Type Analysis

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Dark Chocolate Segment to Grow at Significant CAGR Backed by Shifting Consumer Preference towards High-end Chocolates

The rising per capita income of consumers across the world has led to increased spending on premium, dark chocolates. Dark chocolates offer a premium appeal to the consumers along with the healthy, sensorial, and textural benefits. Dark chocolate is a rich source of antioxidants, balances the blood pressure level, and offers many other advantages that entice consumers to buy it in the market. However, the milk chocolate segment holds the major market share across the globe owing to its popularity among children and adolescents. On the other hand, white chocolate found vast scope for the consumer categories preferring to avoid the bitterness of dark chocolate.

By Category Analysis

Emerging Trend of Premiumisation to Drive Global Chocolate Sales

The demand for premium chocolates is growing across the world due to the rising consumer discretionary income and evolving gifting tradition. Consumers look for novel chocolate flavors and innovative chocolate formulations, which fuels the segmental growth. Moreover, the increased importance of seasonal chocolates during special events and their increased affordability is also aiding the growth of the market. The growing demand for such chocolates has encouraged manufacturers to introduce small, consumer packs in the market, which is expected to boost growth during the forecast period.

By Chocolate Consumption Analysis

Reticence of U.S. Consumers towards Sugar Intake is Affecting Sales by Volume

The volume sales in the U.S. reached 1,410.20 thousand tons in 2019 and is projected to witness a marginal growth trend throughout the forecast years due to the consumer reticence towards high sugar intake. The FDA altered the regulations in the year 2018 for all the U.S. chocolate confectionery products, forcing companies to have a declaration on the packaged items about how the added sugar content is likely to create health issues. On the other hand, the volume demand for sugar-free chocolates is expected to grow at a CAGR of 6.3% in the country. The country’s per capita consumption of this confectionery items was at 4.5-4.6 kg, which is higher compared to sugar confectionery products at 3.0-3.1 kg/person in 2018.

Consumers in the U.S. are becoming more inclined towards chocolate confectionery products having reduced sugar content to cut down on the sugar intake levels. The leading players in the industry are taking efforts to develop and launch low-sugar chocolate products. For instance, Nestlé has patented a new process to naturally sweeten chocolate and to cut the use of refined sugar. On the other hand, consumers also prefer the private label chocolate products considering the value for the price.

REGIONAL INSIGHTS

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North America is the major market shareholder due to the growing demand for premiumized chocolate confectioneries. The market in the region is primarily propelled by the growing trend of organic and clean-label chocolate confectioneries. Consumers are looking for healthy products that also provide indulgence. There is growing popularity of dark chocolate in the region which is attributed to the increasing knowledge regarding the health benefits of cocoa. The rising interest in knowing the origin of chocolate and labor welfare concerns among consumers is expected to contribute to the growth in the demand for fair-traded cocoa and chocolate, strengthening the region’s position in the chocolate confectionery market share.

The market in Asia Pacific is expected to grow at a significant CAGR. The demand for chocolate confectioneries in emerging economies such as China and India has witnessed an upward trend in recent years, attributed to the increasing consumer expenditure on indulgent confectionery products, especially chocolate items. In developed countries such as Japan and Australia, the industry is currently driven by the knowledge of perceived health benefits of cocoa such as its polyphenol content and its role in healthy aging.

Europe is the largest market for confectionery products of chocolate and is expected to rise at a CAGR of 1.7% during the forecast period from 2020 to 2027. Within Europe, countries such as Switzerland, Belgium, Germany, Austria, and the U.K. are the largest producers and consumers of chocolate products. The per capita consumption of chocolate in these countries is higher than the countries of other regions. According to CBI Ministry of Foreign Affairs (EU), the global per capita consumption of chocolate was 0.9 kg per year while the same is higher in European nations (Switzerland at 10.5 kg and Germany at 9.2 kg per capita per year).

KEY INDUSTRY PLAYERS

Barry Callebaut to Invest in Innovation & Expansion to Strengthen Market Presence

Barry Callebaut, a leading player in the chocolate industry, is focused on investing in the development of innovative products to strengthen its position in the market. For instance, in February 2020, the company launched completely dairy-free chocolates to its plant craft range.

The market exhibits a highly consolidated structure. It is dominated by five major players holding approximately 88% share in the entire market owing to their huge client base, strong brand loyalty, & robust distribution network. The key players such as Olam International, Cargill, Inc., Nestle S.A, and Berry Callebaut AG are focusing on strategic mergers, acquisitions, and partnerships to further consolidate the market.

Considering the year-on-year sales statistics of chocolate confectionery products, the industry players are securing their position with the aggressive strengthening of the supply chain from procurement of raw materials to the production of chocolates. This will enable the market players to achieve sustainable growth in the industry.

LIST OF KEY COMPANIES PROFILED:

• Barry Callebaut (Zürich, Switzerland)


• Nestle S.A. (Vevey, Switzerland)


• Chocoladefabriken Lindt & Sprungli AG (Zürich, Switzerland)


• Ferrero SpA (Alba, Italy)


• HARIBO GmbH & Co. KG (Bonn, Germany)


• Mondelez International (Illinois, U.S.)


• Meiji Holdings Co., Ltd. (Tokyo, Japan)


• The Hershey Company (Pennsylvania, U.S.)


• Ezaki Glico Co., Ltd. (Osaka, Japan)


• Mars Inc. (Virginia, U.S.)

KEY INDUSTRY DEVELOPMENTS:

• October, 2019 – ITC Company (India) launched the most expensive chocolate priced at approximately INR 0.43 million for a kilogram under the brand name of Fabelle. The limited-edition product called ‘Trinity - Truffles Extraordinaire’ entered into Guinness World Records to become the world’s most expensive chocolate.


• June 2019 – Mondelēz International, Inc. launched Cadbury Dairy Milk chocolate with 30% reduced sugar in India. The product is made of natural sweeteners and free from artificial preservatives.

REPORT COVERAGE

The chocolate confectionery market research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading distribution channels of the product.

An Infographic Representation of Chocolate Confectionery Market

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Besides this, the report offers insights into the market trends for chocolate confectionery and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years.

Report Scope & Segmentation