Why is This Chocolate Bar $8?

Perhaps not surprisingly we get this question a lot.

It’s an important question to address.  The answer goes to the heart of why we make, and love, single origin chocolate, and helps explain why our bars retain the unique flavors of the cacao from which they’re made.  It’s a long answer, so grab a cup of our single origin hot cocoa and settle in!

Two factors which have a large impact on the price of mass market chocolate bars are the price big chocolate companies pay for their ingredients, and the amount and type of ingredients in each bar.

The ingredient list for mass market chocolate bars is often the same:  Sugar, Cocoa Liquor, Cocoa Butter, Soy Lecithin and Vanillin.

Sugar is listed first on most mass market bar ingredient lists because the bars contain more sugar than anything else.  For example, a 44 gram Hershey’s milk chocolate bar contains 24 grams of sugar, which means the bar is 54% sugar.   Sugar is far less expensive than cacao, therefore the more sugar in the bar the less expensive it is to manufacture.

In addition, mass market bars typically use conventional sugar, which is far less expensive than the organic sugar we use.  The commodity price for conventional sugar fluctuates but is currently around .20 per pound.  By contrast our organic sugar is more than three times as expensive.

Unloading a shipment of organic sugar.

One of the reasons conventional sugar costs so much less than the sugar we use is that many plantations from which conventional sugar is sourced engage in unfair labor practices.  To quote from a 2014 U.S. Department of Labor report on sugar plantations, in the Dominican Republic (which has the largest single allocation of the U.S. Sugar quota), “violations include twelve-hour work days, seven-day work weeks; and occupational safety and health concerns such as the lack of potable water, absence of minimum work age and indications of forced labor, including unlawful overtime performed under threat of deportation.”

One of the many reasons we enjoy making craft chocolate is that we’re able to ensure all our ingredients are sourced ethically and sustainably, including sugar.  We’ll always pay more than the commodity price in exchange for the assurance that workers are treated fairly and ethically.  For that reason, among others, we source our sugar from the Native Green Cane Project, which not only adheres to labor laws but offers workers profit sharing as well as housing, education and healthcare.

Native is also a leader in sustainability.   Among the many sustainable approaches they undertake are harvesting green sugar cane as opposed to the traditional method of burning the fields, encouraging biodiversity by restoring wildlife habitat, and using the steam created by their mills to generate enough electricity to make those mills energy self-sufficient.

This explains why we pay 300% more for sugar than manufacturers of mass market chocolate, so now let’s tackle the ingredient that’s second on the list in those mass market bars:  cocoa liquor.

Monica in Guatemala with sacks of Asochivite cacao.

Put simply, cocoa liquor is created by grinding cocoa beans.  Because the beans contain around 50% cocoa butter, grinding them results in a thick liquid (much like grinding peanuts results in a paste).  Large manufacturers create cocoa liquor by combining many different West African cacao beans, for which they’ve paid a commodity price.  As with sugar, this price fluctuates, but is currently around .96 per pound.

We pay far more than the commodity price for our cacao.  The price differs slightly depending on the farm we’re buying from, but is usually in the range of $4, or more, per pound.

We pay 400% more than commodity prices for many reasons.  One is the quality of the beans – we spend a lot of time at origin sourcing fine flavor beans, and those beans command a premium price.  We need to use the highest quality fine flavor beans because our bars highlight the true flavors of the cacao, without additives – but more on that later.

Another reason is our commitment to ethical and sustainable sourcing.  In many ways the problems with the mass market cacao supply chain are even worse than those with mass market sugar.

Most cacao is farmed on small, family owned farms.  These farmers keep only about half of the already low global commodity price for cacao, since there are many middlemen between them and the world market.  This leaves many farmers to get by on less than $1.25 per day, below the threshold of absolute poverty.  Add to this the uncertainty of the yearly cacao crop due to weather and disease, and most farmers are living in desperate conditions.  These conditions are unacceptable by any measure, but the problem is compounded by the pervasive practices of deplorable working conditions and child slave labor – farmers don’t make enough money to pay decent wages, or any wages at all, so they resort to forced labor to survive.

Child labor has long been an issue in the cacao industry.  Although steps are being taken to reduce its prevalence, as of today there are an estimated 2.3 million children working in the cocoa fields of Ghana and Cote d’Ivoire, with over 500,000 of them working in abusive conditions.  Ghana and Cote d’Ivoire account for almost 70% of the world’s cacao supply, and are the main origins for commodity cacao.

There is much more that can and should be said about the extreme poverty faced by cacao farmers, and the deplorable working conditions and child labor to which it gives rise.  There’s much more information available online, and two good resources are Make Chocolate Fair and Slave Free Chocolate.

Tom in Nicaragua with Bayardo and Leonel Blandon on Leonel’s farm.

Among our main goals when we started Goodnow Farms Chocolate was to source our cacao ethically and sustainably, and to ensure transparency through our entire supply chain.  To achieve this, we visit all the cacao farmers from whom we source, as well as the post-harvest processors to whom they sell their cacao.  We spend time on their farm, see their labor practices firsthand, review their paperwork and speak with the farm workers.  We negotiate prices directly with the farmers and post-harvest processors, so that we always know how much the farmers are receiving for their cacao.  We also maintain our direct relationships, keeping in contact with the farmers and visiting on a regular basis.

Monica with the farmers of San Juan Chivite.

We also invest in communities when we see an opportunity.  For example, we funded the construction of a new fermentation and drying facility for the community of San Juan Chivite in Guatemala, the source of our Asochivite bean, and contribute to the cost of a full-time manager to oversee the fermentation and drying process during each harvest season.

Our commitment to ethical and sustainable sourcing plays a large part in the cost of producing our bars.  Not only do we pay four times more than commodity prices for our cacao, and three times more for sugar, but there are also costs associated with maintaining those relationships to ensure they remain equitable.

The next major reason our chocolate costs more than that of mainstream manufacturers is the percentages of cacao and sugar we use in our bars.

To be called “chocolate” a product must contain at least 10% cacao, which means both cocoa solids and cocoa butter.  Some mass market bars famously contain as little as 11% cacao – just enough to legally be called chocolate.  And here’s where the cost of the ingredients makes a big difference – our plain single origin bars contain between 70% and 77% cacao!  Since cacao is by far the most expensive ingredient, and significantly more expensive than sugar, the cost of the raw ingredients in our bar is much higher than that of mass market bars due to the percentages of cacao used.

So, now we’ve covered cacao and sugar.  The last three ingredients on the original ingredient list for mass market bars are cocoa butter, soy lecithin and vanillin.  Since this post is already epically long these three will get short shrift, but here goes.

All three of these ingredients are a large part of the reason why big chocolate companies don’t care much about the quality or the flavor of the beans they buy, and therefore don’t pay much for them – each dilutes or masks the flavor of the cacao beans.

The cocoa butter these companies use is deodorized and dilutes the flavor of the beans.  Although cocoa butter is expensive not much is used – keep in mind the total cacao percentage (11% in our example above) includes both cocoa solids and cocoa butter.  In our case, we fresh press our cocoa butter from the same beans we use to make our bars, so our butter retains the unique flavor of the beans.  Pressing cocoa butter in small batches is wildly expensive and very few craft makers do it, but it makes for an incredibly flavorful and creamy bar.

Soy lecithin is an ingredient we don’t use, since it significantly affects the flavor of the chocolate, and masks the true flavor of the beans.  It’s basically a cheap way for chocolate manufacturers to give their bars a smooth and creamy texture without adding more cocoa butter, which would be far more expensive.

And, no explanation of mass market chocolate would be complete without describing vanillin.  It seems innocuous – “vanilla” spelled in a slightly different way.  But, vanillin is a completely different product than vanilla.  While vanilla is a natural flavoring derived from Orchids, vanillin is made from wood pulp.  We’re not making that up. The process involves using petrochemicals on byproducts from the paper industry.  Really.

Needless to say vanillin adds its own vanilla-like flavor to the chocolate, and this flavor further masks any remnant of the flavors of the cacao beans used to make it.  While vanillin is far less expensive than real vanilla ($7.00/lb vs $272/lb) a very small amount is used since not much is needed to add vanilla flavor.

Roasting and winnowing in the chocolate kitchen.  So much fun!

Finally, although there are many other factors that contribute to the cost of our bars, the last one we’ll mention in this very lengthy post is the labor cost associated with handcrafting our bars in small batches.  Attention to detail is what allows us to draw out the incredible flavors of the premium beans that we source, but that attention to detail takes time, and lots of it.  All the time we spend creating customized roasting & conching profiles, and overseeing every other part of the chocolate making process, is reflected in the cost of each bar.

This blog post took on a life of its own, so if you’ve made it this far thanks for sticking with us!  We hope this helps better explain why our bars cost more than the mass market bars which until recently were the only option on many store shelves.  And we also hope this explains why we’re so committed to using only the highest quality ingredients and to working directly with farmers to ensure they’re paid an equitable and sustainable price for their cacao.

We look forward to the day when extreme poverty and forced labor are no longer issues in the chocolate industry.  In addition to the steps we’re taking to address these problems in our own small way, there are many other craft chocolate makers who share these goals and ideals.  By paying $8 for a chocolate bar, either one made by us or by another socially conscious craft maker, you’re not only eating awesome chocolate but helping to make that goal a reality!

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