1 00:00:00,160 --> 00:00:05,000 Speaker 1: First chocolate get ready for synthetic stuff potentially. A new 2 00:00:05,040 --> 00:00:07,760 Speaker 1: report into the state of the global chocolate industry is 3 00:00:07,800 --> 00:00:11,960 Speaker 1: found that confectionery giants, all your big ones, scrambling for 4 00:00:12,080 --> 00:00:15,560 Speaker 1: alternatives to cocoa beans. The main ingredient in our chocolate 5 00:00:15,920 --> 00:00:18,880 Speaker 1: is becoming raarer and rarer to come by, shooting prices 6 00:00:18,920 --> 00:00:21,480 Speaker 1: up to above double what they were in twenty twenty three. 7 00:00:21,520 --> 00:00:25,000 Speaker 1: You'll know this story from last year. But now businesses 8 00:00:25,079 --> 00:00:28,680 Speaker 1: like Cabri Hershey's, they're looking into lab grown coco is 9 00:00:28,720 --> 00:00:32,120 Speaker 1: an alternative, whole bunch of stuff. Paul Jewels is Rubbobanks 10 00:00:32,120 --> 00:00:33,800 Speaker 1: research channels with us. Paul, good afternoon. 11 00:00:34,800 --> 00:00:36,040 Speaker 2: Hi, how you doing very well? 12 00:00:36,080 --> 00:00:37,959 Speaker 1: Thank you? So what's making it so hard to get 13 00:00:37,960 --> 00:00:39,560 Speaker 1: our hands on cocoa beans? 14 00:00:40,840 --> 00:00:43,479 Speaker 2: So the reason we've got these very very high chocolate 15 00:00:43,479 --> 00:00:45,680 Speaker 2: prices is all to do with that main ingredient, coco. 16 00:00:46,479 --> 00:00:48,720 Speaker 2: What we've seen over the past couple of years is 17 00:00:48,880 --> 00:00:52,880 Speaker 2: cocoa prices they reached all time highs. So, just to 18 00:00:52,920 --> 00:00:55,440 Speaker 2: give you a bit of an idea, coco prices typically 19 00:00:55,480 --> 00:00:58,640 Speaker 2: trading around about two three thousand US dollars a ton, 20 00:00:59,000 --> 00:01:01,520 Speaker 2: they went all the way up to eleven thousand US 21 00:01:01,600 --> 00:01:04,440 Speaker 2: dollars are done. We had a lot of production issues 22 00:01:04,520 --> 00:01:07,039 Speaker 2: take place and as a result, that led to less 23 00:01:07,080 --> 00:01:09,040 Speaker 2: coco in the world and higher prices. 24 00:01:09,640 --> 00:01:12,160 Speaker 1: And what's what we're as why the shortage. 25 00:01:13,200 --> 00:01:16,520 Speaker 2: So the shortage really occurred because where you have most 26 00:01:16,520 --> 00:01:19,880 Speaker 2: of the production, West Africa. You have two countries and 27 00:01:19,920 --> 00:01:22,600 Speaker 2: they produce about sixty percent of the world's cocco. So 28 00:01:22,640 --> 00:01:25,839 Speaker 2: that's Garner an Ivory coast. What we saw take place 29 00:01:25,920 --> 00:01:29,600 Speaker 2: over the past few seasons was very bad weather. We 30 00:01:29,640 --> 00:01:32,240 Speaker 2: saw a number of different issues as well. We also 31 00:01:32,319 --> 00:01:35,040 Speaker 2: saw a lot of tree disease that led to a big, 32 00:01:35,080 --> 00:01:39,039 Speaker 2: big drop in yields and overall production and production was 33 00:01:39,160 --> 00:01:40,839 Speaker 2: historically really really low. 34 00:01:41,959 --> 00:01:44,520 Speaker 1: Okay, Well, is that an issue that will recover or 35 00:01:45,040 --> 00:01:47,240 Speaker 1: clearly that clearly these big companies don't think it is, 36 00:01:47,280 --> 00:01:49,760 Speaker 1: otherwise they wouldn't be piling all this money into alternatives. 37 00:01:49,840 --> 00:01:50,480 Speaker 1: Is that true? 38 00:01:51,560 --> 00:01:53,920 Speaker 2: So to some extent, yes, but at the same time 39 00:01:54,160 --> 00:01:57,280 Speaker 2: we are actually seeing a bit of a recovery already. 40 00:01:57,480 --> 00:02:01,200 Speaker 2: It's that classic case of high prices curing prices. So 41 00:02:01,360 --> 00:02:03,800 Speaker 2: producers have been given the signal to really try and 42 00:02:03,840 --> 00:02:06,080 Speaker 2: ramp up production of cocoa. Because they've got these very 43 00:02:06,160 --> 00:02:08,320 Speaker 2: very good prices, they can make quite a lot more 44 00:02:08,320 --> 00:02:11,760 Speaker 2: money than they typically would because of that extra production. 45 00:02:11,800 --> 00:02:14,480 Speaker 2: We're now starting to see online we are seeing a 46 00:02:14,639 --> 00:02:17,280 Speaker 2: bit of a decrease in price, so we've seen prices 47 00:02:17,320 --> 00:02:20,960 Speaker 2: probably about half from their peak, but they're still historically 48 00:02:21,000 --> 00:02:22,520 Speaker 2: really really high. 49 00:02:22,840 --> 00:02:25,760 Speaker 1: Okay, can you tell the difference that they're going into 50 00:02:25,840 --> 00:02:30,760 Speaker 1: lab grown cocoa beans or lab grown chocolate is can 51 00:02:30,800 --> 00:02:32,320 Speaker 1: you tell the difference when you taste it? 52 00:02:33,639 --> 00:02:36,160 Speaker 2: Yeah, So again it's a bit of a mix to 53 00:02:36,200 --> 00:02:37,440 Speaker 2: you on this one. So if you look at the 54 00:02:37,520 --> 00:02:40,360 Speaker 2: lab grown stuff, probably with that that they're really trying 55 00:02:40,400 --> 00:02:42,840 Speaker 2: to make it more or less identical because you're actually 56 00:02:42,919 --> 00:02:46,359 Speaker 2: replicating the cocoa bean itself. The issue of the lab 57 00:02:46,360 --> 00:02:50,320 Speaker 2: grown coco though, is that's actually nowhere near commercialization. It's 58 00:02:50,320 --> 00:02:53,560 Speaker 2: a really really expensive process, so there's probably very few 59 00:02:53,560 --> 00:02:57,040 Speaker 2: people in the world who've actually tasted lab grown coco that. 60 00:02:57,160 --> 00:03:01,440 Speaker 2: The more interesting one is actually fermentation, So that's transforming 61 00:03:01,480 --> 00:03:06,880 Speaker 2: plants based inputs such as oats, seeds, faber beans, barley, 62 00:03:07,680 --> 00:03:10,480 Speaker 2: grape seeds, for example, and mixing those together to get 63 00:03:10,480 --> 00:03:15,280 Speaker 2: a chocolate like taste or chocolate like ingredients With that one, 64 00:03:15,400 --> 00:03:17,480 Speaker 2: they've said that the taste can be a little bit different, 65 00:03:17,520 --> 00:03:19,160 Speaker 2: it can be a bit more sour if they don't 66 00:03:19,200 --> 00:03:22,120 Speaker 2: quite get the fermentation right. And it's not necessarily a 67 00:03:22,120 --> 00:03:24,919 Speaker 2: direct replacement for a typical chocolate bar. It would more 68 00:03:24,960 --> 00:03:27,960 Speaker 2: be used in fillings and other chocolate like. 69 00:03:28,080 --> 00:03:31,120 Speaker 1: Ingredients because also it wouldn't be brown, would it. 70 00:03:32,560 --> 00:03:34,440 Speaker 2: Yeah, exactly. It would certainly probably have a bit of 71 00:03:34,440 --> 00:03:37,960 Speaker 2: a different profile, a bit of a different appearance and taste, 72 00:03:38,000 --> 00:03:40,240 Speaker 2: So yeah, I wouldn't expect it to be a like 73 00:03:40,280 --> 00:03:42,120 Speaker 2: so like substitution for sure. 74 00:03:42,200 --> 00:03:45,600 Speaker 1: Does this a fit coffee as well? 75 00:03:45,440 --> 00:03:47,840 Speaker 2: We're not really seeing it to the same extent with coffee, 76 00:03:48,400 --> 00:03:51,160 Speaker 2: and to be honest, even with coco, and you know, 77 00:03:51,160 --> 00:03:53,240 Speaker 2: we can talk about coffee as well here. If we 78 00:03:53,320 --> 00:03:56,000 Speaker 2: are seeing this to any degree, very very small in 79 00:03:56,080 --> 00:03:59,400 Speaker 2: terms of the total market share. The focus is still 80 00:03:59,520 --> 00:04:02,800 Speaker 2: very much on the typical tree crops. These are very 81 00:04:02,840 --> 00:04:07,240 Speaker 2: much infancy projects in developments that we're seeing very very 82 00:04:07,280 --> 00:04:08,320 Speaker 2: small part of the market. 83 00:04:08,360 --> 00:04:10,600 Speaker 1: Paul, appreciate your time this evening. Thank you. Paul Drowls 84 00:04:10,680 --> 00:04:13,600 Speaker 1: Rabobank research analysts with us. So basically the moral of 85 00:04:13,600 --> 00:04:15,880 Speaker 1: the story is go before you eat your chocolate, go 86 00:04:15,920 --> 00:04:18,080 Speaker 1: and check the ingredients and on the back. If it 87 00:04:18,080 --> 00:04:23,440 Speaker 1: says something to the effect of chocolate like ingredient, it's 88 00:04:23,480 --> 00:04:27,000 Speaker 1: not chocolate. It's just not chocolate. 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