A report from the Brussels based European Cocoa Association (ECA) at the end of last week showed that cocoa bean processing by European based manufacturers is down to 342,713 metric tonnes in the fourth quarter of 2010.
Grindings are a key indicator of demand for cocoa from the chocolate and foods industries. The ECA accounts for around two-thirds of European bean processing.
But Francisco Redruello, senior food analyst at Euromonitor International, argues that grindings are not the only indicator of demand and he puts the lower fourth quarter figures down to the fact that leading chocolate manufacturers were in restocking rather than processing mode during the period as a way to offset higher prices for the commodity.
Indeed, he told ConfectioneryNews.com today that the market research firm estimates a retail volume growth of 2 per cent in 2011 for chocolate confectionery in Europe, with consumer confidence on the rebound in the UK market in particular.
“Turkey, with a strong emerging chocolate market, will have around a 7 per cent hike in retail volume in this category,” continued Redruello.
The analyst also predicts stability in the cocoa futures markets over the next few months.
"Based on the fact that supplies are getting through to the ports in the Ivory Coast in spite of the political crisis, in addition to the better yields from the heavy rainfall in Ghana, we do not forsee any strong price fluctuations," added the analyst.
Meanwhile, cocoa fell in the London LIFFE today on signs that global supplies will increase. Cocoa for March delivery slid 0.9 per cent, to $3,155 a metric tonne this morning in the London futures market.