Market Trends of North America Compound Chocolate Industry
Economical and Desirable Substitute of Cocoa Butter
- Compound chocolate is a type of chocolate substitute that is made using vegetable fats instead of cocoa butter. This alternative ingredient makes it a more cost-effective option for manufacturers, who can reduce their production costs while offering similar functionalities to regular chocolate.
- The demand for chocolate and confectionary products in North America has been steadily increasing, particularly in the United States. The country holds the largest market share in the region, with a high level of chocolate consumption and production volumes. In 2021, the United States was the largest retail sale market for confectionery products, with a value of USD 39.5 billion.
- As a result, manufacturers are incorporating compound chocolate into their products to meet the growing demand for chocolate and increase their revenue. With its lower production costs and similar functionalities to regular chocolate, compound chocolate is becoming an attractive option for manufacturers looking to make a profit in the North American market.
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Milk Chocolate Being the Most Desired Form of Chocolate in North America
- Milk compound chocolate is currently the most popular and widely consumed type of chocolate in North America, and it holds the majority market share in the compound chocolate market. This type of chocolate is made by combining premium-quality skimmed milk powders with a blend of milk and sugar, which is then mixed with cocoa powder. Milk chocolate is highly favored by consumers, with over two-thirds of the world's chocolate consumption being in the form of milk chocolate, according to Nunu Chocolates.
- Companies like Hershey's, a significant milk chocolate producer in North America, have benefited from this trend. In 2022, Hershey's North America Confectionery segment generated USD 8,536.5 million, which accounted for about 82% of its total sales. Hershey's also holds a significant market share in the United States chocolate market, with about 33.5%, making it a leading player in the industry.
- In addition, the growing awareness of the health benefits associated with milk chocolate has contributed to its increased consumption. Milk chocolate contains a high level of micronutrients and antioxidants, which make it a popular choice among health-conscious consumers. Milk chocolate's versatility is another factor driving its popularity, as it can be used for a variety of applications such as making fudge, enrobing, dipping, decorating, and more. Its ready-to-use profile and freeze/thaw stability make it a useful ingredient in various bakery products.
- Overall, these factors are contributing to the milk chocolate segment's dominance in the North American chocolate market, with manufacturers increasing production to meet the growing demand.
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