CHOCOLATE makers in the fast-growing Asian market are replacing a bigger proportion of cocoa butter, which gives confectionery its melt-in-the-mouth texture, with cheaper palm oil-based alternatives.

    The move will help confectioners keep down prices in the price-sensitive region where chocolate sales are forecast to grow more than 5 percent this year to about 917,000 tons, according to market researcher Euromonitor International.

    This is well ahead of growth of less than 1 percent in the United States and about 1.5 percent in western Europe.

    Palm oil-based butter mimics the taste of cocoa butter but is much cheaper. Higher demand for butter alternatives, known as cocoa butter equivalent (CBE), has pushed prices up by about 10 percent to US$3,300 a ton in the past year, but this is still more than US$4,000 below the price of butter from cocoa beans.

    “We don’t normally buy CBE, but now we use it because of requests from customers,” said Richard Lee, chief executive officer of Aalst Chocolate, a Singapore-based firm that sells chocolate to bakeries, ice cream makers and food makers.

    “When butter prices were low, we didn’t even use CBE at all,” said Lee, who estimated that the firm’s orders for substitutes were three to four times higher than last year.

    Confectioners in Asia and Europe are allowed to add cocoa butter equivalent to chocolate, but hold the maximum amount at 5 percent since a higher content can alter the taste and put off customers. In the United States, products using butter alternatives cannot be labeled “chocolate.”

    Cocoa beans are processed into roughly equal parts butter and powder, which is used in cakes, cookies and drinks.

    Chocolate typically contains about 20 percent cocoa butter, so confectioners in Asia and Europe looking to save money can replace about a quarter of the cocoa butter with something else.

    “The whole thing is about affordability — there’s no point in paying so much,” said Mohammad Jaaffar Ahmad, chief executive of the Palm Oil Refiners Association of Malaysia.

    Cocoa butter prices jumped 28 percent this year to as high as US$8,200 a ton on strong demand.(SD-Agencies)