Sweetness follows? Colombia’s craft chocolate challenge

Suzie Hoban, Chocolatier

Colombia is making a name for itself in the rapidly growing craft chocolate market. The government sees cacao as a transition crop in the peace process. But while consumers benefit from tasty new treats, many farmers have yet to see an upside. Opening up to a new market opens them up to new challenges. Farmers will need better access to production facilities and a stronger connection between quality and price to benefit fully.

Suzannah Hoban is a former marketer turned chocolatier. Originally from Australia, Suzannah studied with some of Europe’s most accomplished chocolatiers before founding Choco Q Chocolate Artesanal and the Colombian Chocolate Club in Bogotá. She’s also a lecturer in cacao and coffee at the University of La Sabana.  

What’s so good about Colombian craft chocolate?

That’s an excellent and complicated question. Colombia has been growing high-quality cacao for generations, but very few people have known about it. Until 2013, Colombia was actually a net importer of cacao.

Historically, Colombians have used their cacao in drinking chocolate – chocolate de mesa – that they mix with milk and lots of sugar or agua panela, which is a local sugar cane juice. So extremely high-quality cacao has ended up in beverages where you really couldn’t taste the quality.

Photo by Rachel Gorjestani. (Unsplash)

A few companies – Casa Luker is one of them – have been producing single-region couverture, but this is chocolate aimed at the wholesale market. Consumers didn’t really know anything about it.

We’ve only really begun to see high-quality Colombian chocolate in the last few years. Three years ago an exporter called Cacao de Colombia created a brand called Cacao Hunters. They’re making exceptional chocolate from high-quality cacao that they’ve helped the farmers process.

About 18 months ago, a Bogotá company called Cabuyaro brought out a brand called Tibitó. They also started manufacturing chocolate for other brands. This is a different model from what we see in the U.S. or Europe, where the chocolate maker is considered an auteur. If you’re not making it yourself it’s not considered high quality.

Photo by Michał Grosicki. (Unsplash)

The other reason is that the Amazon basin is the birthplace of the cacao tree. It makes sense that the greatest diversity is here. The International Cocoa Organization (ICCO) classifies six percent of the world’s cacao as fine flavor – fino de aroma. Of that six percent, 76 percent comes from Peru, Colombia, Venezuela, and Ecuador.

What challenges do Colombian cacao farmers face at the moment?

We have the high-quality genetic material. But it’s a complex process to cultivate and process it.

Harvesting cacao is an incredibly physical process. Cacao doesn’t lend itself to industrial farming. You can’t shake the tree to get the pods, like you’d do with olives or almonds. You need to cut each pod from the tree with a machete. From there, the cacao needs to be fermented and dried and if those steps aren’t done properly you can destroy the flavor.

Theobroma Cacao. (Wikimedia Commons)

It’s also an enormous investment to acquire the chocolate-making machines. Until recently, companies that wanted to make a high-quality product had to bring their crops to the big manufacturers in Bogotá. You need at least 500 kg for a single run on these machines and few farmers have that quantity.

That makes it difficult to create a formula that best showcases your product, because once you add sugar you’ll have close to a ton of chocolate to sell before you can try again.

Cabuyaro really changed the landscape. They have a small-batch facility that can work with a minimum of 16 kg. More producers and associations and co-ops can access these facilities and experiment with their formulas.

The growth is also showcasing the diversity of the cacao.

There are a lot of variations in the making of a bar that affect the final flavor. Experimenting lets them create a formula that best represents their cacao.

At least 10 brands have emerged in the last 18 months since Cabuyaro started producing for other brands. Some are producing bars made with cacao from small towns in departments like Casanare. I’ve lived here six years and I still had to look these places up on a map. To me that’s really exciting. We’ve never had traceability in Colombian chocolate back to its origins.

The growth is also showcasing the diversity of the cacao. Colombia has 15 percent of the world’s flora and fauna. So it makes sense that the chocolate is equally diverse.

It sounds like a similar dynamic to coffee and wine.

Yes, but it’s more complex and more difficult to do in Colombia. There are incredible resources and support for coffee because it’s been such an important part of the national economy. Those resources don’t exist in cacao. They’re coming, but slowly.

It’s also something that most consumers aren’t aware of. We’ve come to expect a standard “chocolate” flavor because the industrial manufacturers work hard to create the same flavor from year to year. But cacao is an agricultural product, like coffee beans or grapes.

Consumers understand that wines from a specific vineyard will change from year to year; we’re just coming to that understanding in chocolate.

Consumers understand that wines from a specific vineyard will change from year to year, but we’re just now coming to that understanding in chocolate. The fine chocolate industry is still very young. We’re looking at the coffee for guidance as to how to create a specialty industry. They’ve done it really well. Wine is the benchmark in terms of understanding sensory profiles and the impact of terroir.

Photo by Pablo Merchán Montes. (Unsplash)

Not a lot of research has gone into what creates the flavor in cacao. We know genetics plays a part, but we’re also just coming to understand how complex those genetics really are.

In general, there are three families: Criollo, which is considered very fine flavor; Forastero, which is considered flat and bitter and is often sold as bulk cacao; and Trinitario – which is a hybrid of those two.

This is an extreme simplification of cacao genetics. You need to do DNA testing of each tree to understand the genetic mix. Each pod on a tree can have a mix of genetics – it’s like siblings within in a family. The genes come together in different ways.

Each pod on a tree can have a mix of genetics – like siblings within in a family.

There have been some studies of terroir that compare the makeup of one tree planted in two different areas. The problem is that is fermentation is complicated and depends on the ripeness of the fruit, the volume of cacao being fermented, the temperature of the farm, and the genetic material.

We can’t really know if the difference in flavors comes from the fruit or the fermentation.

What does the growing interest in craft chocolate mean to the typical Colombian cacao farmer? Are they benefitting from this trend?

There are lots of opportunities but a lot of challenges as well. Colombia is hoping cacao will play a large role in developing its rural economy and in the peace process as a transition crop from coca.

Both coca and cacao love the same climate, soil, and altitude. Farmers in areas that are now under government control – that’s most of the country now – have an opportunity to be part of the legal system again.

Colombia is hoping cacao will play a large role in the peace process as a transition crop from coca.

Photo by Cala Maffia. (Unsplash)

Eight months ago that was great plan. But since last December the international price of bulk cacao has fallen by 33 percent. What happens in Ivory Coast now affects prices in Boyacá. Ivory Coast produces 40 percent of the world’s supply of cacao. Everyone thought production there would decline when in fact they had a bumper crop – 20 percent more than expected.

Current Cocoa Prices at Commodity.com: Our comprehensive guide presents objective information about cocoa updated regularly by our editorial board. Get prices.

Where do cacao farmers sell their crops?

There are three markets for cacao – the commodities market, the certification market (for example, Fair Trade and Certified Organic), and the premium market for fine flavor cacao.

Globally, the fine chocolate industry still young and small. The industry in Colombia is even younger and smaller. The premium market is so small we don’t even have figures. But it can protect farmers from the volatility of the commodities market.

Most buyers of premium cacao sign long-term contracts at a fixed price. Some farmers who’ve signed with Cacao de Colombia, for example, earn about 2.5 times the market price. Uncommon Cacao – a broker based Guatemala – is now selling cacao from Tumaco and Sierra Nevada. That exposure puts farmers in a better position when it comes time to renegotiate their contract.

The challenge is educating farmers how to cultivate cacao. Fermentation and drying are difficult steps for a farmer to do individually. You need a lot to do it well, and it’s best if done in a central facility. Some companies are building fermentation facilities and buying the either the pods or the seeds covered in pulp and fermenting it themselves.

I’m not sure where I stand on that. These companies claim their farmers are earning 70 percent more but I want to see some more robust numbers. It feels to me like they’re pushing the farmers further down the supply chain, and the lower you are the less you earn.

On average, only three to six percent of the price of a bar goes to the farmer.

On average, only three to six percent of the price of a bar goes to the farmer; 30 percent goes to the retailer. I feel strongly that farmers need to be further up the supply chain, but I’m keeping an open mind. I understand that a farmer can’t do the quality control on their farm that’s possible in a central facility.

Cacao seed in the fruit, or pocha. Photo by Keith Weller, USDA ARS. (Wikimedia Commons)

We also need buyers who recognize quality and are willing to pay for it. There’s a lot of education that needs to be done at a consumer level to explain the difference between a one-dollar and 10-dollar bar.

The craft chocolate industry is trying to figure out how to define itself.

The craft chocolate market is exploding, and that’s a good thing. But there are many people making craft chocolate bars who don’t know what they’re doing. They’re producing a pretty awful product and selling it at 10 dollars a bar to cover their costs.

That can damage the market but it’s not something that the farmers can control. Cacao Hunters and Cabuyaro know what they’re doing. They’re producing excellent bars and winning international awards, so I have a great deal of confidence in these companies.

How are the big industrial manufacturers responding to the rise of craft chocolate?

It’s certainly not gone unnoticed. Many big names are bringing out dark chocolate or premium brands at five dollars a bar. That’s the middle ground.

Of course, they muddy the waters when they use terms like “artisanal” or “craft.” These terms are losing their meaning and the craft chocolate industry is trying to figure out how to define itself.

This is where coffee is really well-organized. The Specialty Coffee Association (SCA) has created standards and a common vocabulary. It has 3,500 graders who could all taste a coffee and come up with the same flavor profile.

The SCA  also has a rating system. A coffee rated 80 points out of 100 is considered specialty; one that earns 90 or above is considered exceptional. These ratings are linked to prices, which helps the farmer understand that if they can get their coffee to an 85 rating, they can expect a specific price. They can decide if it’s worth the investment.

We don’t yet have a consistent grading system. There’s no connection to price.

In chocolate we don’t have anything like that. We don’t yet have a consistent grading system. Farmers are sending their product to different organizations and getting different results. They don’t know who to believe, and there’s no connection to price.

So, even though ICCO classifies six percent as being fine flavor, only 0.06 percent of that earns a premium price. There’s still a disconnect, and it’s difficult for a farmer to see a return on an investment in upgrading their equipment.

Chocolate in its rawest form. (Wikimedia Commons)

Cacao farming is economically precarious. An outside expert may tell them an extra day of fermentation will lead to a higher-quality crop. But that extra day comes at a tremendous cost. We need to show them it’s worthwhile and right now we don’t have solid numbers to make that argument.

Still, we’re moving in the right direction. In San Francisco, TCHO is working with Equal Exchange and USAID to build labs that analyze cacao liquor. That’s cacao that’s been fermented, dried, winnowed, and ground into a paste. They’re building labs at origin and training people how to make and evaluate it.

The Fine Cacao and Chocolate Institute has a system that analyzes powder from raw cacao nibs. Anyone can use this system and it eliminates the variables that can affect the flavor.

Once the industry can agree on an evaluation system, we can certify graders and instructors. That’s what happens with coffee.

The other great risk is the use of a clone called CCN51. It was developed in Ecuador in the 1970s to combat witches’ broom disease. It’s also very productive. On average it produces four times more cacao than local genetic varieties. So it’s popular with aid agencies and governments as a way to increase farmers’ yields.

CCN51 can produce four times more cacao than the local genetic variety. But will never earn more than the market price.

The problem is that it’s not a fine flavor. It can produce a good bar, but not an exceptional one. I would never question a farmer’s decision to plant CCN51 over a higher-quality variety, because fine-quality cacao is highly susceptible to disease and produces a lower yield. But CCN51 cacao will never earn more than the market price.

It can also hurt a country’s reputation. Ecuador has seen its ratings for fine flavored-cacao fall from 100 percent to 75 percent. Currently Colombia is at 95 percent but the proliferation of CCN51 could affect that assessment. Again, we need a solid system that connects quality to price before we can incentivise farmers to move off CCN51.

There’s so much about the market that’s out farmers’ control.

Another problem for Colombia is the presence of cadmium. It’s heavy metal common in volcanic soils. Next year the EU will impose limits on cadmium levels in food that may rule out all cacao from Latin America. The Santander region produces 40 percent of Colombia’s cacao. Its soil also has the highest cadmium levels in the country.

It’s difficult for farmers to make decisions about how to proceed because there’s so much about the market that’s out of their control and there’s still a lack of hard data.

It really surprises me that the industry is so immature, considering that some chocolate companies have been around for at least a century.

Chocolate was industrialized a long time ago and craft chocolate all but disappeared. The percentage of cacao in the chocolate we grew up eating is actually quite small. A Hershey’s bar is only 11 percent cacao. It’s mostly sugar, dairy, and fat.

This is another big issue in the industrial sector. Most of the cacao butter – the natural fat of the bean – is used either for couverture or sold to cosmetics companies for lip balms and lipsticks.

A Hershey’s bar is only 11 percent cacao. It’s mostly sugar, dairy, and fat.

Craft or small-batch chocolate is a recent development. Companies that wanted to get back into this  market had to invent their machinery because everything was built for an industrial scale. Still, 10 years ago there were maybe three craft chocolate makers in the U.S. Today there are more than 200.

Five years from now, where will the Colombian craft chocolate market be?

In five years, Colombia will have become the new destination for high-quality cacao. For that to happen, farmers need to see consistently high prices for it to be worth growing high-quality varieties and investing in the extra work and infrastructure.

They need consistent support to cultivate higher-quality varieties or increase their yields. Farmers frequently tell me that organizations come in to teach a class but they never hear from them again. The farmers might plant a new variety on their recommendation, but not know when the pod is ripe.

They also need better infrastructure. If co-ops can get central fermentation centers and the education to properly ferment the cacao, they can increase the quality and earn a premium.

And every cacao farmer needs a good evaluation system that’s linked to price – one that tells them whether it’s worth the additional investment to improve their product.