Real and Compound Chocolate Market Size, Share & Industry Analysis, By Type (Real Chocolate and Compound Chocolate), By Form (Chips, Slabs, Coatings, and Others), By Application (Confectionery, Bakery, Dairy and Frozen Products, Beverages, and Others), and Regional Forecasts, 2019 - 2026

KEY INDUSTRY INSIGHTS

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The global real and compound chocolate market size was at USD 24.25 billion in 2018 and is projected to reach USD 35.62 billion by the end of 2026, exhibiting a CAGR of 4.97% in the forecast period (2019-2026).

Real chocolate mainly consists of cocoa mass and cocoa butter, whereas the compound chocolate has vegetable oils as a replacement of the cocoa butter along with cocoa powder, which is used in place of cocoa mass. Real chocolate has superior sensorial properties. However the utility of compound chocolate lies in its technical advantages viz. high heat resistance, which makes it suitable for consumption in warmer countries.

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The demand for chocolate confectioneries in emerging economies such as China and India has witnessed a positive trend in recent years, attributed by rising consumer expenditure on indulgent confectionery products, especially chocolate confectioneries. This trend has pushed the sales of real and compound chocolate – the demand dynamics for which is expanding from the traditional processed food sector. The steady growth trajectory for the industrial chocolate market will witness a transformation depending on the end-consumers awareness and inclination of real and compound chocolate.

MARKET DRIVERS

“Robust demand for Specialty Chocolate Products.”

The global market for real and compound chocolate is driven by robust demand for premium sized chocolate offerings, which primarily utilizes real chocolate as a major ingredient. Rapid expansion in demand for premium or specialty chocolates, especially in developed economies 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. Premiumisation trend in chocolate confectioneries in the developing economies like China and India also remained strong in the year 2018, attributed by growing income of Chinese consumers, coupled with a strong demand for higher quality products with attractive packaging.         

“Significant Opportunities For Economical Cocoa and Chocolate Products”

The global real and compound chocolate market is also driven by favorable market sentiments for economically priced chocolate products. This trend is particularly prominent in emerging economies, as the per capita income of consumers in such economies is still comparatively lower than most of the developed countries, which will facilitate the growth of compound chocolate products in the foreseeable future. The prominent international market players such as Nestlé  S.A. S.A., Mars Inc, Mondelez International are focusing on increasing their low-priced chocolate product portfolio, especially in developing markets due to their high popularity, enhanced convenience, ease of processing and importantly its affordability.

SEGMENTATION

By Type Analysis

“Real Chocolate is dominating the global marketplace – Compound chocolate will witness faster growth rate during the forecast years (2019-2026).”

Globally, the real chocolate remains a leading type owing to the promising growth in specialty chocolate products and premiums offerings. Cocoa extracts are emerging as an ingredient-of-choice in a variety of applications, including ice cream, confectionery, non-alcoholic beverages, indulgent baked commodities, and nutritional drinks.

The availability of cocoa butter substitutes and alternatives such as palm oil, shea butter, sal nut oils, and others at reasonable prices is boosting the compound chocolate manufacturers to expand their production capacity, which is a positive aspect for the growth of the compound chocolate market.

By Form Analysis

“Coating based on Real and Compound Chocolates is a dominating form – Versatility and Strong Demand Dynamics from various Application Sectors are expected to Fuel its Growth Trajectory.”

Coating form of real and compound chocolate has better functional properties in terms of high melting resistance, ease-of-use in bakery, confectionery, and other processed food sectors – the growing demand for chocolate-coated indulgent products is expected to drive the future utilization of coating form of real and compound chocolate.

Chocolate chips are also witnessing significant growth, especially from the artisanal bakery sector, where it is utilized in the development of cookies. Moreover, majority of chocolate chip recipes are prepared with dark chocolate offering value-addition in terms of strong antioxidant potential.

By Application Analysis

“The chocolate confectionery is leading application of real and compound chocolate – The dominance is expected to continue amidst steadily rising demand scenario in the emerging markets of Asia Pacific, the Middle East, and Africa.”

Most of the real and compound chocolate is channelized for the production of chocolate confectionery as in comparison to sugar and gum confectioneries, the demand for chocolate confectionery is growing at a significant pace across all the regions.

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The chocolate industry thus occupies a lion share of the world’s cocoa and ingredients production. The deshelled cocoa beans (nibs) are preferred by cocoa ingredients manufacturers for enhanced organoleptic traits of the final products. The growth in the chocolate confectionery industry mirrors the utilization of cocoa-based and cocoa-butter alternatives as an ingredient. Regionally, the per capita chocolate consumption in Western Europe and Asia is expected to rise by 2021, thereby driving the market of the real and compound chocolate.

REGIONAL ANALYSIS

“Europe and North America are leading the current global market for real and compound chocolate; Asia Pacific real and the compound chocolate market is projected to witness the fastest growth.”

The global real and compound chocolate industry is multi-layered, and the complexity has increased in recent years as producers of raw materials (cocoa), grinders & processors of cocoa, and finished chocolate product manufacturers are making continuous efforts for forward and backward market integration.

Europe holds the majority real and compound chocolate market share, followed by North America. The large cocoa processing base present in these two regions remains the vital driving force for their market dominance. The high per capita consumption of cocoa-based products is also considered the contributing factor.

The Asia Pacific real and compound chocolate market is projected to expand at the fastest CAGR of 8.38% during the foreseeable years owing to promising demand for real, as well as a compound, finished chocolate products. The Middle East and Africa’s market is propelled by demand from end-use industries, in particular, the chocolate confectionery sector.

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Chocolate in North America is one of the most-consumed treats, and around one-fourth of the world’s chocolate is sold in the region. North America is a profitable regional market, especially for real chocolate manufacturers, as consumers are willing to spend reasonable to high amounts for high-quality or premium chocolate products.

The trend of chocolate premiumization and organic chocolate in North America is a significant hit, as consumers are highly inclined towards products made from pure ingredients and offering immense health benefits. The region is also one of the essential markets for post-processing cocoa products.

The demand for high-end ultra-premium chocolate products in the U.S. has pushed the sales of high-grade cocoa liquor and cocoa butter. The ingredient manufacturers are developing European-style premium industrial chocolate that is desirable for the artisanal applications. The melt-in-the-mouth feel of chocolate is increasingly preferred by consumers, which has consequently led to higher sales of cocoa butter.

INDUSTRY KEY PLAYERS

“Moderately consolidated industry structure in the global real and compound chocolate market.”

Barry Callebaut AG, Mondelēz International, Inc., Cargill, Incorporated, and Nestle S.A. are some of the key players in the global real and compound chocolate market. These key giants are intensively focussing on the new developments, and value addition - the increasing demand for versatile, innovative, nutritious, and exotic chocolate offerings has prompted the real and compound chocolate manufacturers to embark on expanding their product portfolio.

The global value chain of the real chocolate industry is characterized by a fragmented supply of raw materials, robust concentration in the intermediate sector (strong dominance of brands such as Cargill, Olam, and Barry Callebaut), followed by a mixed set of retail chocolate processors and manufacturers.

LIST OF KEY COMPANIES PROFILED:

• Barry Callebaut AG


• Mondelez International


• Cargill Incorporated


• Nestlé  S.A.


• Fuji Oil Company Limited


• The Hershey Company


• Puratos Group


• Mars Incorporated


• Olam International


• CEMOI Group

Report Coverage 

The real and compound chocolate market is majorly propelled by the robust growth trajectory of the global industrial chocolate and chocolate confectionery industry. There has also been a significant rise in the origin share of global grindings; this has given a substantial boost to the overall consumption of cocoa-based ingredients. The export of semi-finished cocoa products has also witnessed a significant increase, bringing in more revenue in producing countries. The increasing demand for compound chocolate in different end-user industries of the food and beverage sector has provided a significant push for cocoa powder in recent years.

Confectionery, bakery, dairy, and frozen products, beverages, and others are the key applications covered in the study. Geographically, the market is segmented into five major regions, which are North America, Europe, Asia Pacific, South America, and Middle East & Africa. The regions are further categorized into countries.

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Along with this, the report provides an elaborative analysis of the market dynamics and competitive landscape. Various key insights provided in the report are the overview of related markets, recent industry developments such as mergers & acquisitions, the regulatory scenario in key countries, and key industry trends.

Report Scope & Segmentation

INDUSTRY DEVELOPMENT:

• In January 2019, The European Union has strengthened its regulation on cadmium in cocoa and derived products. The new regulation has become effective in January 2019, and this regulation monitors the cadmium levels in cocoa and derived products. If the cadmium level rises above 1 ppm, chocolate makers will have to blend the cocoa with other cocoa with lower cadmium content. 


• In November 2018, Fuji Oil Holding, Inc., a supplier of oil and fat ingredients to the food industry, has agreed to acquire The Blommer Chocolate Co., the largest cocoa processor and ingredient chocolate manufacturer in North America.