There are reports in the financial markets of growing concern over the EU’s botched vaccine programme. COVID has impacted demand for chocolate, especially at the premium end of the market where chocolatiers rely on hospitality, airports, and boutiques – all of which have been closed during the pandemic.
Moving to an online model can help offset some of those losses, but it cannot come near to filling the gap left by a retail sector that is in a meltdown.
Many eyes are carefully watching the movements of Barry Callebaut, which is one bellwether for the industry. In the last weeks, cocoa futures have been factoring higher supply than demand into the future prices. The commodity price itself over the last 3 months is, while not the worst the industry has known, still depressed with weak trading volumes as you can see below (you can check up to date prices on our ‘Commodities’ page here at Bartalks).
The fourth-quarter cocoa grinds from Europe, which represents the biggest chocolate-consuming region, were down 3.1% YoY, and in Asia, grinds were down 4.2%. In total for the year 2020, European grinds were down 3.9% and those in Asia down even further at 5%.
We had reported earlier that Cote d’Ivoire had a backlog of cocoa at warehouses and the West African nations are concerned that a recovery will be delayed by the continuing Pandemic in Europe which is set for a third wave after a fumbled vaccination rollout by bickering leaders who seem to vacillate between hair-brained schemes to disastrous policy, leaving a vacuum for anti-vaxxers and other conspiracy groups to sow seeds of doubt in the overall programme, further hindering efforts to get the groups economy back on track.
Last week Thorntons in the UK decided to close all its retail outlets, and in the US Belgian chocolatier, Godiva had earlier decided to close all their 128 retail outlets in the US. How many other smaller businesses have already thrown in the towel?
