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Exporting cocoa to Germany

Takes about 20 minutes to read

Germany is the second-largest grinder and importer of cocoa beans in Europe, behind the Netherlands. Opportunities for exporters lie in conventional and premium products (speciality, fine flavour and certified chocolate, especially organic). In the premium segment, direct trade is preferred among smaller German traders and specialty chocolate makers. In general, the German cocoa and chocolate market is rather competitive given the high number of players active in the sector.


1 . Product description

The cocoa tree (Theobroma Cocoa) grows in tropical areas between 15 and 20 degrees latitude north and south of the equator: Africa, Asia, and Latin America. After extraction from the pod, cocoa seeds are fermented and sun-dried. A cocoa producing tree can deliver on average 0.5 to 2 kg of dried seeds per year.

The international cocoa market (including Germany) distinguishes three types of cocoa beans:

  1. Common grade: Forastero cocoa
    Forastero was originally grown in the high Amazon region and is now the predominant cocoa variety cultivated mainly in Africa, accounting for around 80% of global cocoa production. The beans have a flatter flavour than the more fruity and citric Criollo and Trinitario beans.
  2. High-grade: Criollo cocoa (original cocoa tree)
    Criollo was originally grown in Venezuela, Central America and Mexico, but is now also grown in Ecuador, Colombia, Peru, Bolivia, Nicaragua, Honduras, Guatemala and Sri Lanka. Criollo makes up 5 to 10% of global cocoa production. The beans have a bitter, aromatic flavour and are easily processed.
  3. High-grade: Trinitario cocoa
    Trinitario was originally grown in Trinidad, but is now also grown in Venezuela, Ecuador, Honduras, Nicaragua, El Salvador, Costa Rica, Cameroon, Samoa, Sri Lanka, Indonesia and Papua New Guinea. The beans are a hybrid of the Criollo and Forastero trees. This variety represents around 10 to 15% of global cocoa production.

Harmonised System (HS) codes are used to classify products and to calculate international trade statistics, such as imports and exports. The focus is on cocoa beans of Harmonised System code 1801.

Other cocoa products are covered in our study on semi-finished cocoa products in Europe.

2 . What makes Germany an interesting market for cocoa?

Germany is the second-largest importer of cocoa beans in Europe

With a market share of 19%, Germany is the second-largest importer of cocoa beans in Europe, behind the Netherlands (43%). Cocoa bean imports amounted to more than 449 thousand tonnes in 2017, with a value exceeding €1.0 billion. Between 2013 and 2017, the total volume of cocoa beans imported by Germany increased by an average annual rate of 9%. Most cocoa beans remain within Germany for further processing, but Germany also plays a role as a re-exporter of cocoa beans. Its re-exports amounted to 16 thousand tonnes in 2017, with a value of €41 million. All beans were exported to other European countries: Poland was the main re-export destination in 2017, accounting for 28% of total German exports. Other important destinations were Austria (23% share), the Netherlands (21%) and France (12%).

Tips:

  • Access the Eurostat Statistics Database to analyse European trade dynamics yourself and to build your export strategy. Identify interesting importing countries and developments such as the emergence of new suppliers and decline of established ones.
  • Have a look at the website of the Port of Hamburg to learn more about the port itself and cocoa specific opportunities.

Germany has a highly developed cocoa grinding and chocolate manufacturing industry

Germany is the world’s third-largest cocoa bean grinder, behind Ivory Coast and the Netherlands. The large grinding industry in Germany can be attributed to the presence of large processing facilities owned by major multinational grinders (examples: Cargill, ADM and Barry Callebaut), most of which are located near Hamburg (Germany’s largest port). Nevertheless, Germany’s grinding activities are currently decreasing slightly due to an increase in value addition in the countries of origin, such as Ivory Coast. An estimated 430 thousand tonnes of cocoa beans were used in the cocoa grinding industry in Germany in 2017.

In addition to its large grinding industry, Germany is the leading chocolate-producing country in Europe, predominantly using bulk beans. According to the German Trade & Investment Agency (GTAI), the production value of chocolate products was estimated at around €5.4 billion in 2017. A large share of the produced chocolate is exported, which makes Germany the world’s largest exporter of chocolate, with an estimated export value of €4.2 billion (17.5% of total chocolate exports worldwide). These export volumes are largely due to the presence of large chocolate manufacturers as Ferrero, Mars and Mondelez. There are also a range of smaller chocolate manufacturers active in the sector. Examples of these are Hachez and Coppeneur. In total, there are about 233 chocolate producers in Germany, alongside hundreds of imported brands. Examples of German chocolate manufacturers can be found on the website of Chocozone.

Growing demand for darker and healthier chocolates in Germany

The average German chocolate consumption in 2014 was 7.9 kg per capita. Germans are the second-largest consumers in Europe, after Switzerland (9.0 kg per capita) and before Austria (7.8 kg per capita). Bars and tablets are the most commonly consumed chocolate products in Germany. German chocolate consumption has reached a level that can hardly be increased. This massive market already creates ample opportunities for developing countries, especially for bulk beans, but it’s reaching a point of saturation.

New opportunities basically lie in the growing demand for higher-quality dark chocolates, for which mostly higher-value fine flavour cocoa beans are required. Drivers of this shift towards darker premium chocolates are the aging population and accompanying changing flavour profiles. There is also a growing demand for chocolates with supposed added health benefits, such as sugar-free or sugar-reduced products and vegan raw chocolate. The niche market for higher-quality and healthier chocolates, however, is already quite competitive with a large range of brands already available in German shops.

Tips:

  • Focus on the premium, specialty, and fine flavour cocoa market in Germany. You can only access the premium cocoa market if you offer high-quality cocoa. See the chapter about quality requirements below to learn more.
  • Want to put premium cocoa on the German market? Try to establish direct trade relationships with smaller traders and chocolate makers. See the section on market segments and trade channels below for more information.
  • See our study on trends for cocoa to learn more about speciality cocoa on the European market.

Growing demand for sustainable healthy chocolate products

For cocoa growers, a consumption trend that might present interesting opportunities is the increasing interest in sustainable cocoa. Up to 55% of all chocolate confectionery sold in 2017 in Germany was produced with sustainably produced cocoa, an increase of 37% since 2013. This is partly explained by the German Initiative on Sustainable Cocoa (GISCO), which was founded in 2012 and aims to increase the proportion of sustainably produced cocoa while improving the livelihood of cocoa farmers and their families. About 70 parties have joined this initiative, ranging from government agencies to retailers, civil society and players in the German confectionary industry.

The most popular sustainability certifications on the German chocolate market are Rainforest Alliance (which merged with UTZ in January 2018) and Fairtrade. Many German mainstream brands are now certified by one of these certifiers. Sales of Fairtrade products in Germany, including cocoa, increased by 15% in 2017 alone (worth €1.3 billion). In 2017, a share of 8% of the total cocoa sector was Fairtrade-certified cocoa.

While organic certification is still a niche market for the chocolate industry, it is becoming more important in the food industry in general. Germany’s food and beverage industry generated a production value of nearly €180 billion in 2017. The organic share of the total food market in Germany in 2017 was 5.1%. Within the chocolate market specifically, examples of German organic chocolate brands are Vivani and Belyzium.

Tips:

  • See our study on buyer requirements for the cocoa sector to learn more about certification schemes.
  • Try to combine audits in case you have more than one certification. In this way, you can save time and money. Also investigate the possibilities for group certification with other producers and exporters in your region.
  • Promote sustainable and ethical aspects of your production process. Support these claims with certification. See our study on doing business with European buyers of cocoa for more tips on marketing and promotional aspects of your cocoa.
  • Before engaging in a Fairtrade certification programme, make sure to check (in consultation with your potential buyer) that this label has sufficient demand in your target market and whether it will be cost-beneficial for your product.
  • Find potential business partners in Germany by checking this list of Fairtrade-certified operators and this list of German Rainforest Alliance-certified brands.

3 . What requirements must cocoa comply with to be allowed on the market in Germany?

You can only export cocoa to Germany if you comply with strict European Union requirements. In our study on buyer requirements for cocoa you can find a detailed analysis of these requirements. The highlights are given below, specified for the German market when relevant.

Legal requirements

You must follow the European Union legal requirements for cocoa, which mainly deal with food safety. Traceability and hygiene are the most important themes. Special attention should be given to specific sources of contamination. Pesticides, mycotoxins (ochratoxin A is of special relevance for cocoa), polycyclic-aromatic hydrocarbons (PAHs) and microbiological contamination such as Salmonella (though cocoa is considered low-risk) are the most common for cocoa beans.

It is also important to consider the contamination from heavy metals during production and handling, particularly cadmium. The presence of cadmium is a particular problem for cocoa from some Latin American countries due to factors like volcanic activity and forest fires. The European Union has strengthened its regulation on cadmium in cocoa and derived products. The new regulation came into effect as of January 2019.

Quality criteria

If you want to access the German market for cocoa beans, you will have to meet international quality standards. They are particularly high within the speciality segment for fine flavour cocoa beans.

Cocoa of Excellence mentions the following factors defining the quality of cocoa:

  • Good trees (genetics)
  • Well cared for and grown in a suitable environment
  • Pods correctly harvested
  • Good practices to keep the trees healthy and free of pests and diseases
  • Optimum fermentation and drying protocols specific to the type of beans
  • Know-how for processing cocoa beans and for chocolate making

High-grade (fine flavour) cocoa beans are generally of a higher quality than common-grade cocoa beans, as their distinctive flavour is popular among manufacturers of high-quality chocolate. Fine flavour beans are usually produced from trees that contain the genetics of Criollo and/or Trinitario cocoa tree varieties. Common grade (bulk) cocoa beans for mass production are genetically derived from Forastero trees.

Harvesting and processing techniques are also important in harnessing the ‘fine’ qualities of fine flavour cocoa beans. During harvesting, you should make sure you only take the ripe fruits. During processing, you should make sure all cocoa beans are fermented and dried homogenously. Cocoa beans should be shipped shortly after harvesting because extended storage (> 6 months) may result in losses due to the relatively high humidity in tropical environments.

To moderate the initially bitter cocoa flavour and to develop the typical cocoa flavour, the beans are fermented. Cocoa grading differs across producing and consuming countries. Standard practices have been set by the international cocoa trade associations. The grading of cocoa depends on the fermentation process:

  • Well-fermented cocoa beans: less than 5% mould, less than 5% slate and less than 1.5% foreign matter.
  • Fairly well-fermented cocoa beans: less than 10% mould, less than 10% slate and less than 1.5% foreign matter.

Tips:

Labelling requirements

The label on cocoa exported to Germany should be written in English. The label should include the following topics:

  • product name
  • grade
  • lot or batch code
  • country of origin
  • net weight in kg

In case your cocoa is organic or Fairtrade certified, the labels should contain the name/code of the inspection body and certification number.

Figure 2: An example of labelling
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Source: Caribbean Agricultural Network

Packaging requirements

Cocoa beans are traditionally shipped in jute bags, which can weigh between 60 and 65 kg.

On the mainstream market, bulk shipment of cocoa beans has become more popular. This means cocoa beans are loaded directly into the ship’s cargo hold or in shipping containers containing a flexi-bag (see figure 3). This mega bulk method is often adopted by larger cocoa processors, which handle cocoa beans of standard qualities.

In the fine flavour/speciality cocoa segment, jute bags are still commonly used. For very high-quality micro lots, th vacuum-sealed GrainPro packaging can be used (see figure 3).

Figure 3: Examples of packaging for cocoa beans: jute bag, container-sized flexi bag and GrainPro
figuur_4_11.jpg

Sources: Osu.edu, Bls.bulk.com and GrainPro

Tip:

Additional requirements

You can expect buyers in Germany to request extra food safety guarantees from you. Examples are the implementation of good agricultural practices and Quality Management Systems (QMS) regarding the production and handling processes.

The main standards in good agricultural practices are provided by GLOBALG.A.P. They are voluntary standards for the certification of agricultural production processes that provide safe and traceable products.

A system based on hazard analysis and critical control points (HACCP) is often the minimum standard required at the level of storage and handling of cocoa beans. Some buyers will also expect you to hold certificates such as International Featured Standards: Food (IFS) or British Retail Consortium (BRC).

Corporate responsibility and sustainability are growing in importance in the cocoa sector. Adopting codes of conduct or sustainability policies related to the environmental and social impact of your company can provide you with a competitive advantage. Leading companies on the German chocolate market such as Ferrero, Lindt & Sprüngli and Mondelez have sustainability policies emphasising the contact with producers, transparency in their operations and their social and environmental impact. German brands which are market leaders, such as Ritter Sport from Alfred Ritter GmbH & Co. KG, also have sustainability policies relating to social and environmental initiatives. These initiatives include the use of standards such as the ZNU Standard (Centre for Sustainable Corporate Leadership) and UTZ (which merged with Rainforest Alliance in January 2018 but continues its programme until the publication of a single new programme at the end of 2019).

Certification standard Rainforest Alliance/UTZ has become important on the mainstream chocolate market. Several traders and manufacturers operating in Germany are registered on the UTZ list of registered cocoa supply chain actors, such as Hanseatic Cocoa & Commodity Office (HCCO). Rainforest Alliance is present on the German market, for instance as the German retailer Lidl.

Requirements for niche markets

Germany has the second-largest organic food market in the world, and is one of the major players on the market for organic-certified cocoa products in Europe. The organic chocolate confectionery sector in Germany has grown significantly since 2010. Both small-scale chocolatiers and larger chocolate makers in Germany offer organic-certified chocolates; nevertheless, organic certification remains a small market and relevant as a niche opportunity. Examples of players active in the organic cocoa sector are Rapunzel (an organic cocoa manufacturer) and Naturkost Übelhör (a German organic trading organisation).

Fairtrade is one of the main certifications for chocolate in Germany, after Rainforest Alliance. The Fairtrade segment has been growing significantly in the last years, with a sharp rise since 2014; the market share of Fairtrade cocoa reached 8% in 2017. There are German alternative trading organisations adhering to Fairtrade standards, such as GEPA and El Puente. In addition, there are organic standards which have been developed by producers and retailers themselves, such as Naturland.

Tips:

  • Check the website of EURO-Lex for more detailed information about the regulations concerning cocoa products.
  • Find out which standards or certifications are preferred by potential buyers in your target segment. Buyers may have preferences for a certain food safety management system or sustainability label depending on their end clients and/or distribution channels.
  • See our study on certified cocoa for more information about the demand on the European market, trends and specific trade channels.

4 . What competition do you face on the German cocoa market?

The Netherlands is Germany’s main cocoa supplier

Despite the fact that Germany harbours two important cocoa ports, Hamburg and to a lesser extent Bremen, direct imports from developing countries represent a smaller share (44%) than imports from surrounding European countries (56%). Especially the Netherlands and Belgium, which have more specialised cocoa importers and processors, export cocoa beans to Germany. Most imports are in the form of bulk beans of West African origin. Ivory Coast saw an increase in exports to the Netherlands in the 2013-2017 period by 14%, whereas Belgium’s exports to Germany increased at an average annual rate of 41%.

Tips:

  • Look for cocoa importers/processors and chocolate makers in Germany which import cocoa beans directly from producing countries. Although most trade in cocoa beans goes through the Netherlands and Belgium, German buyers might also be interested in sourcing cocoa beans directly from your country.
  • Identify your potential competitors and learn from them in terms of marketing (website, social media, trade fair participation), product characteristics (origin, quality, oil content) and value addition (certifications and processing techniques). Well-structured websites where you can learn from your competitors are for example Ingemann (Nicaragua) and Xoco Gourmet (Honduras).

5 . Through what channels can you put cocoa on the German market? Which market segments to target?

In terms of segmentation and channels, the German market does not deviate much from the European market, as described in our study on trade channels and segments for cocoa. Figure 5 shows the main channels for export of cocoa beans to the German market. Below, we set out how the three segments of the German cocoa market are developing:

Chocolate confectionery

The chocolate confectionery sector in Germany is very concentrated, with a few large companies dominating the sector: Ferrero, Lindt & Sprüngli, Mondelez and Mars. Ferrero’s product portfolio includes brands like Ferrero Rocher, Ferrero Küßchen, Mon Chéri, Nutella and Duplo, whereas Lindt is a leader in the premium chocolate sector, mainly known for its wide range of chocolate bars.

Supermarkets such as Edeka, Lidl, Rewe and Aldi are important channels for the sale of chocolate products to consumers. They are important for mass products of big brands in Germany but are also increasingly offering (premium) chocolate products under their private label. About 45% of chocolate sales go through supermarkets, and 31% via convenience stores. Webstores, such as Feine Schokolade, account for 2% of total chocolate sales in Germany. Germany also hosts a high number of medium-sized and smaller chocolate companies such as:

Food industry

Cocoa products are also important ingredients for the German food industry. The German food and beverage industry generated a production value of nearly €180 billion in 2017 and employs about 600,000 people. In 2017, the confectionery and snacks sector reached a production value of €11.9 billion, of which the cocoa and chocolate product sector was the largest with net sales of almost €5.4 billion. Companies producing biscuits, ice cream, pastries and other bakery products are some of the main users of cocoa products.

Cosmetics industry

Germany is the largest cosmetic market in Europe, with total sales reaching €18.6 billion in 2017. The natural cosmetic market in Germany is also the biggest in Europe, and it is still growing: the turnover of natural cosmetics have grown by around €1.2 billion since 2016. The cosmetics industry processes cocoa butter in products such as creams and soaps. If you want to know more about opportunities in this industry, refer to our study on natural ingredients for cosmetics.

Figure 5: The main channels for export of cocoa beans to the German market
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As an exporter, entering the market will vary according to the quality of your cocoa beans and your supply capacities. These will match the demand of different types of companies in Germany. There are about 233 chocolate producers in Germany. Although most of those are small or medium-sized enterprises, a few big companies with cocoa-processing facilities account for most of the national sales (such as Ferrero, Mondelez, Ludwig Schokolade and Mars). There are also cocoa importers and manufacturers who only work with high-quality organic cocoa beans, such as Rapunzel.

For exporters of cocoa beans in higher volumes and standard qualities, large importing companies can serve as a gateway into the German market. Companies such as Albrecht & Dill Trading and Schlüter & Maack are traders of commodities, including raw cocoa beans and cocoa products. Leading German brokers dealing with cocoa are HCCO and Interwalga. Germany also has importers that focus on specialised cocoa products. A trading organisation only dealing with organic produce is Naturkost Übelhör. Other alternative trading organisations are GEPA and El Puente, which adhere to Fairtrade standards.

You can also target speciality chocolate makers directly. This is recommended for producers and exporters dealing with fine flavour cocoa beans of a high quality. For example, Hachez is a chocolate manufacturer of premium cocoa and Rausch is a chocolate manufacturer which sources its fine flavour cocoa beans directly from producing countries.

Tips:

  • Want to meet potential buyers in Germany? Attend interesting trade events in Germany such as COTECA, ISM, Anuga, Biofach (organic products) and Internorga (catering and food service) or in other European countries such as Chocoa, Origin Chocolate Event (Netherlands) and Salon du Chocolat (France). Attendance at such events can also provide you with additional insight into the preferences of German buyers with regard to origin, flavour and sustainability certification.
  • Try to establish direct trade relationships with smaller German traders, specialty chocolate stores, chocolatiers or bakeries. Examples of bean-to-bar companies that already source fine flavour cocoa directly from producing countries include Rausch and Hachez.
  • Use industry associations to find potential buyers in Germany. One example is the Association of the German Confectionary Industry (BDSI).
  • Be consistent, punctual and reliable. Germans consider these factors essential in doing business. That means you should reply in time to enquiries by possible buyers (within 48 hours). You should also be open and realistic and do not make promises that you might not be able to fulfil. See our study on how to do business with European cocoa buyers for more information.
  • Check the website of the European Cocoa Association to find more information about German cocoa traders.
  • Check the website of the Federation of Cocoa Commerce to learn more about global cocoa traders, cocoa manufacturers, cocoa trade associations and other players in the global cocoa sector.
  • Use our study on how to find buyers on the European cocoa market and the website of the Federation of Cocoa Commerce to find potential buyers.
  • See our study on market segments and channels for cocoa for more information about the European cocoa market.

6 . What are the end-market prices for cocoa in Germany?

Prices for chocolate can be segmented in lower-end, middle range and upper-end. In general, the lower-end chocolate products are often of standard quality and are the cheapest on the market. The upper-end products are chocolate products of high quality, made with fine flavour beans and possibly with a single origin. For more details about segmentation on the cocoa and chocolate markets, refer to our study on channels and segments.

Table 1: Indication of consumer prices of chocolate per market segment in Germany

Market segment

Brand

Details

Price per 100 grams

Upper-end

Georgia Ramon

75%, Ghana, dark chocolate

€10.40

Labooko

72%, Brazil, vegan, organic

€5.15

Belyzium

78%, dark chocolate, organic

€10.00

Market segment

Brand

Details

Price per 100 grams

Middle range

GEPA

70% dark chocolate, organic

€2.29

Lindt

85% dark chocolate

€2.29

Vivani

75%, Panama, organic

€2.81

Rausch

75% Costa Rica

€2.88

Rapunzel

85% dark chocolate, organic

€3.44

Market segment

Brand

Details

Price per 100 grams

Lower-end

REWE

Dark chocolate

€0.79

REWE

Organic dark chocolate

€1.49

Milka

Milk chocolate

€1.09

Ritter Sport

73% dark chocolate

€1.09

Trumpf

Schogetten Nougat

€0.99

Source: Websites of several retailers

The price breakdown for chocolate is illustrated in figure 6.

Be aware that export prices of cocoa beans, and the share kept by cocoa producers, will depend on the cocoa bean quality, the size of the lot and the supplier’s relationship with the buyer. However, the largest shares are kept by chocolate companies and retailers.

Figure 6: Price breakdown for chocolate
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Source: Cocoa Barometer, 2015

Tips:

Please review our market information disclaimer.

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