Downs pays homage to key workers and praises the ‘power of sweet’ in SOTIC keynote

Under Downs's watch, the NCA has become one of the most influential trade bodies in the US. His keynote speeches always involve a little fancy dress and showmanship. This year, he was carried on stage by a forklift truck, dressed as a factory operative with a hairnet, safety glasses, and lab coat, to the sound of Jackie Wilson’s soul classic [Your Love Keeps Lifting Me] Higher & Higher.

Behind the bit of slight self-mockery lay an essential message to the record 700+ executives from the confectionery industry and their retail partners: For companies to continue to grow, they need to adopt a ‘people-first’ policy with their staff.

He emphasised the importance of understanding the art, science, creativity, work, and effort of candy making and that honouring and supporting frontline employees, particularly in the manufacturing and retail sector of the industry, is crucial.

Almost 60,000 people work directly in the US confectionery industry, with jobs to another 270,000 suppliers and 22,000 brokers and distributors.

“The world is profoundly different today than a decade ago when I joined NCA. But a few things haven't changed… one of which is that the world still loves chocolate and candy -- John Downs, NCA president & CEO

“Our multiplier effect throughout our supply chain is pretty strong. It's 11-1. So, for every job we create, 11 other jobs are created in the economy. And that's almost 700,000 jobs, so we are an important part of the US economy,” he said.

“And I'm not just talking about the people in this room. I'm talking about your plant managers, cooks, quality assurance teams, maintenance machinists. I'm talking about your sorters, your packers, and on and on and on throughout this great business.

“They're the people who do the important work of making America's favourite treats that everyone enjoys, and they're the most passionate, dedicated, hardworking, and happiest people I think we all have ever met.”

ESG goals

He reminded senior management that they are here “on the backs of our frontline people in this industry,” and the theme of his speech was one of “radically selflessness”; invest in people because the main ESG (Environmental, Social, and Governance) criteria for people in the job market is how do companies treat employees. “And our priority should be their advancement and their growth.”

When Downs joined the NCA 10 years ago, he said he made it his mission to spend the first year visiting as many companies and manufacturing facilities in the country to learn more about the industry, its companies, and employees.

“The world is profoundly different today than a decade ago when I joined NCA. But I still have my lab coat, and I'm very proud of this lab coat. We have gone through a global pandemic together, we've dealt with crippling inflation. We've had labour shortages and supply chain challenges.

"But a few things haven't changed… one of which is that the world still loves chocolate and candy. When you talk to our retail partners, brokers, consumers, family, or friends… our category is alive, vibrant, and on the move. “

His words were validated by recent numbers published in the NCA’s 2024 State of Treating Report, which highlighted almost $50bn in sales of chocolate and candy in 2023.

Compelling narratives from brands and companies.

Downs reinforced his message of the power of collective action as an inspirational force to uplift each other and keep the category moving forward. He said other American trade bodies are looking to the NCA for inspiration and its compelling narratives from brands and companies. 

Downs ended his speech by saying, “When I arrived at the NCA 10 years ago, I didn't know anything about chocolate and candies. I didn't know anything about the people, and I didn't know the staff. So I wanted to understand the business to be a good leader and a steward for all of you - and it’s been an honour and a privilege to lead the industry."

US Sugar Program

Along with the current global issues affecting the price of cocoa, there was the continuing problem of the US government’s “arcane” Sugar Program. Downs said any reforms look unlikely this year as it is part of the Farm Bill that has already been extended to the end of September before any new legislation is passed. Still, with the election approaching, it will likely be put back until 2025.

“Congress is completely dysfunctional,” he said. We all know it's a struggle to operate where these prices are. Still, the silver lining is that we're making some incremental progress, and is that we have some more time to tell our story to members of Congress to say that simple modifications could make a big difference as it relates to supply certainty for one of our most significant commodities. “

He said the NCA is not taking its eye off the ball, and Brian McKeon, Senior Vice President of Public Policy, is laser-focused and committed to seeking these modifications. “We have a new strategy, and we're making progress. So, hopefully, we're going to see something happen in this new Farm Bill,” he said.

In a fireside chat with political columnist George Will, attendees heard that the US sugar policy is dysfunctional, with high prices and low supply due to an arcane system based on outdated ideas.

In his opinion, the US Constitution “was designed in a way to almost hamstring government to make sure not too much gets done. Right now, it keeps sugar prices high and supply is low. It doesn't seem to make any sense. If the American people knew about something like the sugar import quotas, they wouldn't survive."

Wills described the sugar programme governed by a minority tyranny to benefit a few, but with the costs dispersed over 333 million people with higher prices for goods like confectionery.

Downs said: “The prices they're paying for sugar are as high as they have ever been. What's happened in the last two years is terrible.”

He also said the US doesn’t grow or produce enough sugar to satisfy the domestic market, and the NCA is in serious discussions about proposals and amendments. He is cautiously optimistic that something will get done. “They're listening to us. We have to give and take going back and looking at the import quotas.”

Consumer spending

Economist Christopher Thornberg, founding partner, Beacon Economics, followed and described the current epoch as the ‘new roaring 20s”.

And all the talk of inflation and recession is just that talk. The social narratives and the economic realities can be confusing. At the start of 2023, 99% of people thought a ‘recession was nigh’, which proved false as consumers went on a spending free, accounting for 70% of GDP as people went to restaurants more or treated themselves to foreign travel and consumer goods.

“The economy is back to a normal equilibrium,” he said, with inflation historically not too high or too low. The main worry for the industry is that chocolate imports are up 30%, which suggests that, like other industries, there is a shifting demographic problem … i.e., not enough people in the job market to fill manufacturing roles. One solution is for more legal migration to help fill the vacuum.

In an election year, a quick straw poll revealed that 90% of people thought the US economy was ‘struggling’, against the 10% who thought it was 'fine'. How this perception plays out with voters in November remains to be seen, but whatever the outcome, there will always be chocolate and candy to at least provide some comfort.