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North American Q4 cocoa grind exceeds expectations

By Oliver Nieburg+

18-Jan-2013

North America’s cocoa grind was up a modest 0.9% in the fourth quarter surpassing traders’ predictions of a slight decline.

Cocoa grinds, an indicator of demand for chocolate products, were released yesterday for North America by the  National Confectioner’s Association (NCA) and showed a 0.9% rise on the same period last year to 120,053 metric tons.

The stats cover grinds for Canada, Mexico and the USA and are compiled from company reporting from the likes of ADM, Hershey, Barry Callebaut, Blommer Chocolate, Cargill, Mars and Nestlé.

High end of expectations

Speaking to ConfectioneryNews.com Francisco Redruello, senior analyst for food at Euromonitor International , said: “It was indeed on the high end of expectations, as trader consensus suggested a moderate decline (1-3%).”

He said that Euromonitor was expecting retail volume sales of chocolate confectionery in the US to grow by 0.1% in 2013, which would be a big gain on last year’s 4% decline.

“We expect a moderate improvement in North American grindings during 2013, provided the fiscal cliff is definitely averted and China doesn’t lose steam during the second half of 2013 - once the effects of fiscal expansion and loose monetary policy ebb away.

No cocoa price hike

He added that the effect on cocoa prices would be limited as the industry was still absorbing surpluses form the 2010/11 season and demand for chocolate in Western Europe was forecast to grow by only 1%

European Q4 cocoa grinds , released earlier this week, were the lowest in seven years and down 6% on the same quarter last year to 327,982 metric tons.

Asia grinds

Grind stats from the Cocoa Association of Asia are expected in the coming days. Early indications suggest figures will be up as the Malaysian grind has already been released and showed a 6.8% rise.

Rabobank commodity analyst Keith Flury previously told this site that Barry Callebaut’s recent $950m acquisition of Singapore-based Petra Foods’ cocoa processing operations was evidence that the industry foresees growth in the emerging Asian market.

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