Cocoa is the powder ground from the seeds of the cocoa or cacao tree. The tree’s botanical name is theobroma cocoa, which stands for “the food of Gods”, something that will not come as a surprise for chocolate lovers the world over.
A cocoa tree looks a little like an apple tree but with broader leaves. Each tree produces between 20-30 pods a year and it takes a whole year’s crop from one tree to make one pound of cocoa.
Cocoa is a capricious plant that likes the heat and damp and will only grow within 10 degrees north or south of the equator in rain-forest type conditions. Ivory Coast, Ghana and Indonesia produce two thirds of the world’s cocoa and of the three countries, Ivory Coast is by far the most significant producer.
In 2002 Ivory Coast was split by a coup into the government-controlled south and rebel-controlled north, and conflict has persisted ever since. Throughout the decade the country continued exporting cocoa but the political situation there remains precarious with exports banned in the past for political reasons. When this happens Ghana usually steps in with increased production to alleviate some of the shortfall.
Apart from politics, weather and disease play a major role in how much cocoa makes it into the world markets each year. Adverse weather conditions such as drought will lead to slower growth while too much rain can cause outbreaks of black pod disease. Brazil, another major producer, grappled in the past with a fungus called witch’s broom that nearly decimated the country’s cocoa crop in the 1990s.
Ripe brown speckled pods can be found on the tree throughout the year but the main harvest starts in September and can last until early in the next year causing prices to dip to their lowest between October and January.
Traditionally, cocoa is sold in the form of beans, and big buyers then process those into chocolate, cocoa butter, cocoa powder, liqueur, etc. In recent years, in an effort to increase the value of exports, some producer countries, such as the Ivory Coast, Ghana, Nigeria and Brazil, have developed their own facilities for grinding beans.
The US is the single largest importer of cocoa, followed by Netherlands and Germany. Of the 2.8 million tons of cocoa produced every year Europe consumes almost a half while the US buys 0.4 million tonnes. The biggest names among the buyers are chocolate makers Nestle, Hershey’s and Cadbury, and food companies like Kraft.
The International Cocoa Organization (ICCO), which represents the producers of cocoa, is a good source of statistics about the crop. Cocoa futures are traded on the NYSE Liffe exchange in London and on NYMEX in New York.