Wed. Jun 19th, 2024

Easter chocolates are not immune to re-deflation

Natasha Kumar By Natasha Kumar Mar27,2024

Easter chocolates are not ;do not escape re-flation

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La Chocolaterie des pères, in Saguenay, had to resign itself to reducing the size of its little chocolate chickens this year.

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The chocolate festival risks being spoiled this year by re-flation. The explosion in the cost of cocoa is forcing certain companies to reduce their formats, raise their prices or even modify their chocolate recipes to meet their budgetary pressures.

The little chocolate chickens from the Chocolaterie des pères went from 25g to 22g this year. The box of twelve lost 36 grams in total, a reduction of 12%.

We had to carry out this slimming treatment in order to avoid increasing the selling price to consumers, explains the factory director – and newly co-owner – Joël Lavoie.

We decided to reduce the weight, but maintain the quality of our product, unlike many of our competitors.

A quote from Joël Lavoie, Chocolaterie des pères

No other product in the range of the chocolate factory established in Saguenay has suffered the same fate in the run-up to Easter. However, considering the harsh reality of the industry, we will undoubtedly have choices to make for the future, affirms Joël Lavoie.

The man of business mentions, for example, the rising costs of packaging and transport costs, a reality experienced by the entire food industry.

However, chocolatiers are also struck by the rise in the price of cocoa which, recalls Joël Lavoie, was at US$2,500 per tonne last year, while forecasts bring it to US$10,000 per tonne this summer. . Unfortunately, despite numerous tight negotiations with our suppliers, I must resign myself to this new reality, he says.

The price of cocoa is suffering indeed a meteoric rise for several months.

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A record of more than 40 years was notably reached. Its price exceeded US$9,000 per metric ton in March. This is 40 to 45% more expensive than the old historic record of 1977, when it reached US$5,100, recalls Sylvain Charlebois.

The scientific director of the Agri-Food Analytical Sciences Research Laboratory at Dalhousie University attributes this skyrocketing prices to cases of disease in the main producing regions, such as Ivory Coast and Ghana, as well as to bad weather and to speculation.

I have never seen an agri-food commodity increase so much, so quickly, adds the expert, according to whom the price of cocoa risks remaining high for a long time to come, as companies negotiate their long-term provisions.

If Sylvain Charlebois fears a resurgence of cases of reduflation, it is above all deskilling that worries him. Cocoa is an ingredient, but when it becomes too expensive, there can be substitution, or reformulation with an artificial product with a chocolate flavor, he notes, which is what the Chocolaterie des pères wanted to avoid at all costs.

If Joël Lavoie has not yet increased the price of his chocolate factory's products, he also expects to have to do so, but reasonably. The competition is very fierce and we want to continue to increase our sales volume, he says, also stressing that he expects to see his profit margins decrease a little.

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Cakes from the Fays chocolate factory, in Oka

The Fays chocolate factories, in Oka, and Bonneau, in Montreal, experience the same reality.

Mathilde Fays says, however, that she does not yet feel the impact of this increase in the price of cocoa, but she has already had to adjust to the inflation and the repercussions of the pandemic. Some of its chocolate bars were reduced this summer to match the competition.

On the shelves, we were bigger, heavier than most of the competitors, she says. That put us at a disadvantage.

We absolutely don't want to cut quality, but we thinks about creating products that maintain affordable prices.

A quote from Mathilde Fays, Chocolaterie Fays

In the Easter creations, she adds, we made fewer large mounted pieces of chocolate, which take more time to produce than moldings, and which are more expensive.

Yves Bonneau, of Chocolaterie Bonneau, for his part does not intend to reduce the formats of his chocolate products, but some of them between them sell for 5-10% more.

Otherwise, he is thinking of eating into his profit margins, because attributing too big an increase to my customers is not a solution, he maintains. It's not up to our customers, who are always there to support us, to pay the bill.

Other products Chocolate products have also undergone reductions in the past year.

Vadeboncœur chocolates, for example, have reduced the format of their packaging of Freddo white chocolate pastilles, also due to pressure on raw materials.

For this one, what is increasing is above all the price of sugar, explains vice-president Angèle Vadeboncœur. Then come the cost of transport, cocoa butter, primary packaging and salaries.

The decision to reduce also comes from observing the competition, to keep the same price as other products in the same family, she specifies.

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The Quality Street chocolate box also increased at Christmas from 725g to 650g. The iconic metal box has almost melted in half since the 1980s.

However, no other seasonal Nestlé chocolate products have been discounted this year, according to our research, but the manufacturer did not respond to our requests for information. Nothing recent to report either from the giant Mondelēz in its Cadbury range, which has instead focused on price increases of up to 15%.

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This image, which went viral in the United Kingdom in 2015, demonstrates the successive reductions in boxes of Quality Street chocolates over the decades.

The vegan log of Jean-Philippe's kitchen lost 25 g in December, but Jean-Philippe Cyr does not see this as a case of re-inflation. We were too tight in weight, he explains. The equipment and procedures in place made it more difficult for us to reach 650 g, which generated significant losses.

Reducing the weight to 625g thus made it possible to minimize losses, according to him, but the selling price was not adjusted for consumers.

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A few months earlier, on Halloween, several children also had the unpleasant surprise of opening chocolate candy wrappers that were emptier than in the past. Sweets have also had a taste, with the rise in the price of sugar.

Products made from cocoa and sugar have otherwise suffered in recent years price increases at checkout for consumers.

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Data from Statistics Canada shows increases of up to 25% for products made from sugar and syrup in retail stores over the past three years, a trend that is likely to continue in the coming months.

< p class="StyledBodyHtmlParagraph-sc-48221190-4 hnvfyV">Reflation in the chocolate aisles is not new, experts remind us.

The packaging of Kit Kat Chunky, for example, has undergone three changes rather than one since 2017. The 50g bars have increased to 40g with an adjusted list of ingredients. Then they found their previous recipe, in a format increased to 49 g.

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In just a few years, the Kit Kat Chunky chocolate bar has gone through several changes, in weight and recipe.

Cadbury's Creme Egg, another symbol of Easter, had already melted from 39g to 34g.

Our data collection also allowed us to trace Toblerone, Purdys, Coffee Crisp and Oh Henry! as well as bags of M&M, all reduced.

In fact, the majority of products made from chocolate, seasonal or not, are still likely to be subject to reductions, according to Professor Jordan LeBel, who specializes in food marketing.

This is one of the most important sectors to watch, in his opinion. Expect it, he warns.

The expert mentions in particular the Hershey's company, which diversified its product portfolio a few years ago, perhaps fearing this increase in the price of chocolate.

Hersey has repositioned itself to be more than a chocolate company,” he explains, “by acquiring brands focused more on snacks, such as Twizzlers, Jolly Rancher and Brookside.

If everything you produce is chocolate, when the price of chocolate and sugar increases, and even the price of eggs, it's three of your nine or ten ingredients in your recipe that eat into profits, continues Jordan LeBel.

However, the manufacturer still had to raise the prices of its chocolate products and also reduce its packaging of Chipits chocolate chips.

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Natasha Kumar

By Natasha Kumar

Natasha Kumar has been a reporter on the news desk since 2018. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining The Times Hub, Natasha Kumar worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my natasha@thetimeshub.in 1-800-268-7116

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