Fairtrade Chocolate Market Outlook
The global fairtrade chocolate market size was valued at USD 11,372.83 Million in 2019 and is projected to reach USD 34,137.23 Million by 2027, expanding at a CAGR of 15.2% during the forecast period, 2020-2027.
Demand for Fairtrade Chocolate is driven by the impulse purchasing behavior of consumers, increasing trend pertaining to fair trade chocolate consumption reducing child labor, increasing customer inclination towards organic Fairtrade chocolates, and increasing preference of consumers towards Fairtrade chocolate.
Fairtrade chocolate is made from cacao beans bought from farmers who are paid a fair price for their crop, instead of a low-price set by the market. The profit margins for farmers are high, which helps them to improve their standard of living and prevents exploitation. These farmers receive additional Fairtrade premiums for investing in community development.
Fairtrade standards ban forced labor and child labor and encourage environmentally-sustainable farming practices. Additionally, production of Fairtrade chocolate involves 100% organic chocolate, which prevents the use of harmful chemicals. Growth in chocolate industries, due to the increasing demand for Fairtrade chocolate, is anticipated to fuel the market during the forecast period.
Fairtrade Chocolate Market Dynamics
Rising income of consumers and their changing lifestyles are key factors increasing impulse purchase of Fairtrade chocolates. Color and packaging played an important role in the purchase of chocolates by consumers over the years. Hence, rising phenomenon of impulse buying is boosting the sales of Fairtrade chocolates worldwide, thus driving the market.
Implementation of stringent regulations pertaining to child labor in various countries is encouraging companies to shift their production unit and encourage farmers to produce Fairtrade chocolates instead of regular chocolates that involve child labor. Fairtrade practices in chocolate production help reduce the need for child labor, as workers earn fair wages, which result in a smaller number of children working to support their families.
Cocoa used in Fairtrade chocolate is not harvested by children. Rising awareness regarding Fairtrade practices is anticipated to drive the market. Consumers have shown an inclination towards organic chocolates in most countries. Organic chocolates are mostly purchased from supermarkets and hypermarkets, owing to the unique variety of attractive products being offered in such places, ready packaging of products, appealing in-store promotions, and consistent quality.
Additionally, consumers are willing to pay for high-end chocolates. Hence, manufacturers are increasingly turning towards organic chocolates which is anticipated to increase the demand for Fairtrade chocolates. The Fairtrade chocolate market is highly driven by the taste preferences of consumers. It is important that the companies focus on product development and marketing strategies such as packaging to gain a wider consumer base and capture new markets.
The market is expected to incline towards Fairtrade chocolates during the forecast period. The supply of Fairtrade chocolate drivers tends to be the stronger influencer of chocolate’s price instability. Many commodities are used to manufacture Fairtrade chocolates, but the main ingredient is cocoa. Supply fluctuations are a result of a number of factors, from political and civil unrest to labor issues and the effect of weather, diseases, and pests on crop yields.
For instance, long periods of dry weather are not conducive to cocoa bean growth, resulting in supply shortages. Hence, the limited supply of cocoa is hampering the Fairtrade chocolate market during the forecast period. Confectionery companies always count on consumers to boost the sale of Fairtrade chocolates at the time of Christmas and other holiday seasons.
Seasonal and festive sales of chocolate are projected to surge in the next few years. Gifting chocolate hampers and bouquets are popular consumer trends in the market, which are expected to strongly favor the market during the forecast period. Additionally, lucrative growth opportunities lie in organic and fair-trade chocolates, which are anticipated to completely change the market dynamics.
Fairtrade Chocolate Market Segment Insights
Source Segment Analysis
Based on sources, the Fairtrade chocolate market is segregated into organic Fairtrade chocolate and regular Fairtrade chocolate. Regular Fairtrade chocolate is expected to grow at a significant rate during the forecast period.
Non-organic chocolate involves cacao and sugar, which is grown with the help of chemical fertilizers, pesticides, and herbicides, which have a negative effect on the environment. The organic Fairtrade chocolate segment is projected to account for a substantial share of the market during the forecast period.
Rising health consciousness and increasing consumer awareness about the demerits of consuming chemical-containing products are anticipated to increase the sale of organic Fairtrade chocolates, thus fueling the global Fairtrade chocolate market.
Type Segment Analysis
In terms of types, the Fairtrade chocolate market is classified as bars, chips and chunks, and others. The bars segment is expected to grow at a rapid pace during the forecast period, owing to increasing demand for organic chocolate bars. The chips and chunks segment is anticipated to grow at a rapid pace during the forecast period. Chocolate chunks are available in irregular sizes, while chips are available in small teardrop shape. These are extensively used in baked products such as cookies or muffins.
Certification Segment Analysis
Based on certifications, the global Fairtrade chocolate is segregated into UTZ Certified, Fairtrade International Certified, Fairtrade USA Certified, and Others. The UTZ is committed to creating an efficient sustainability program with effective certification and traceability tools for socially and environmentally responsible cocoa production that meet the needs of producers and markets.
The Fair trade USA helps producers access high wages and create safe working conditions. This certification-authorizing body has grown into a leading market-based model of sustainable production, trade, and consumption of Fairtrade chocolates.
Sales Channel Segment Analysis
In terms of sales channels, the global Fairtrade chocolate is segmented into online and offline. The online segment is further segmented into company-owned websites and e-commerce. The offline segment is sub-segmented into supermarkets, convenience stores, department stores, and others.
The supermarket sub-segment is expected to expand at a rapid pace during the forecast period, due to availability of Fairtrade chocolates. Furthermore, supermarkets are placing premium Fairtrade chocolates, such as organic Fairtrade chocolate, around the point of sale for a high-priced impulse purchase.
The convenience stores sub-segment is projected to expand at a rapid pace during the forecast period, due to the sale of a limited range of Fairtrade chocolates. The e-commerce sub-segment is anticipated to grow at a significant rate during the forecast period due to rising number of online purchases of chocolates as gifts among consumers.
On the basis of regions, the global Fairtrade chocolate market is fragmented into North America, Europe, Latin America, Asia Pacific, and Middle East & Africa. North America accounted for a significant share of the market in 2019 due to the presence of a large number of companies offering Fairtrade chocolate in the US.
The market in Europe is expected to grow at a rapid pace during the forecast period, due to the presence of certified cocoa and Fairtrade chocolate market in UK and Germany. South Africa dominates the Fairtrade chocolate market in the Middle East & Africa, as around 30% of the total world’s cocoa is produced in Ghana.
China accounts for the largest share of the market in Asia Pacific, while the market in Japan is projected to expand at a rapid pace during the forecast period. The use of Fairtrade cocoa and chocolate is growing in developing economies such as India and China due to the growing consumption of cocoa.
Key Benefits for Industry Participants & Stakeholders
- In-depth analysis of the global Fairtrade chocolate market
- Historical, current, and projected market size in terms of value (USD million) and volume (tons)
- Potential & niche segments and regions exhibiting promising growth covered
- Industry drivers, restraints, and opportunities covered in the study
- Recent industry trends and developments
- Competitive landscape & strategies of key players
- Organic Fairtrade Chocolate
- Regular Fairtrade Chocolate
- Chips & Chunks
- UTZ Certified
- Fairtrade International Certified
- Fairtrade USA Certified
- Rainforest Alliance Certified
- Convenience Stores
- Department Stores
- Specialty Stores
- Company-owned Websites
- North America
- Asia Pacific
- Latin America
- Middle East & Africa
Key Market Players Profiled in the Report
- Divine Chocolate Limited
- Barry Callebaut
- Chocolate and Love
- Belvas Chocolate
- Stella Bernrain
- EMVI Chocolate
- Endangered Species Chocolate
- Fran's Chocolates
- Lily's Sweets
Prominent manufacturers operating in the global Fairtrade Chocolate market include Divine Chocolate Limited, Barry Callebaut, Chocolate and Love, Belvas Chocolate, Stella Bernrain, EMVI Chocolate, Endangered Species Chocolate, Fran's Chocolates, Lidl US, and Lily's Sweets.
These companies are considered as key manufacturers of sulfonated asphalt based on their revenue, research & development (R&D) activities, regional presence, and supply chain management system.