Chocoholics: Your fix in Asia could get pricier

Chocoholics: Your fix in Asia could get pricier

Asia's newly minted chocoholics are tempting sweets-makers seeking growth, but chocolatiers face fresh challenges ranging from different cultural tastes to the region driving cocoa prices to three-year highs.

"The chocolate consumption still is very low in Asia Pacific," Denis Convert, vice president for gourmet in Asia Pacific at Barry Callebaut (Swiss Exchange: BAR.N-CH), the world's largest chocolate maker, told CNBC last week.

"We are still at the beginning of the story. The average consumption is about 200 grams per capita in Asia Pacific when it is between 6-8 kilograms in Europe." But Asia's chocolate demand is growing about 10 percent a year, he said.

Globally, around $107.63 billion was spent on retail chocolate, with $13.06 billion of it in the Asia Pacific, according to data from Euromonitor.

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Courting that growth may be the main driver pushing cocoa prices (Intercontinental Exchange US: @CC.1) to three-year highs. "The demand has outstripped supply for the third consecutive season. This hasn't been seen for 47 years," Erkut Ozer, CEO of Global Trading Enterprises, told CNBC recently. "The real demand factor has come from Asia. We've seen double-digit growth in chocolate consumption and that's really been the driver."

To counter the rising prices and still tap growing demand, Barry Callebaut is trying to boost its supply. "We work closely with the farmers to develop sustainable farming in order to improve the yields every year," Convert said, adding he expects the shortage to be a long-term issue for the industry.

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Targeting farming methods isn't just about appearing environmentally friendly; it has a good chance of helping to boost supply. Ozer noted that much of the world's cocoa production is done on small family farms, with as much as 70 percent coming from Africa.

"The farms are very small. So efficiency-wise, they aren't the great producing farms that we expect from our other soft products," Ozer said. "We are starting to see a real shift in investment in that sector."

The cocoa supply isn't the only challenge in getting Asia hooked on chocolate. Many in the region find chocolate too sweet or "heaty," a reference to traditional Chinese medicine's belief that such foods can cause physical symptoms, such as sore throats.

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