Crafting India’s Chocolate Story

SUMMER IN WEST GODAVARI district of Andhra Pradesh is oppressive. At his 20-acre plantation on outskirts of Vijayawada on a blistering summer morning, G.V.S Prasad ensures visitors are well-hydrated with tender coconut water from the farm. However, real attention-grabbers are cacao fruits, growing amid coconut, banana and spices. Cacao fruits acquire flavour notes of plant(s) growing next to them. “The recently harvested fruit has notes of chakkarakeli bananas,” he says.

Prasad has been growing cacao for Mondelez India — which introduced cacao farming in West Godavari in 1960s — and other multinational chocolate brands for four decades. Earlier this year, craft chocolate-maker Manam Chocolate used his beans in its ‘single origin India series.’ The 68% dark chocolate tablet is a bestseller at its sprawling store in upmarket Banjara Hills of Hyderabad. The 70-gm tablet, priced ₹400 (four times Cadbury Silk), has a lot of takers. “I can finally get a chocolate in India which has natural sweet and fruity notes and isn’t all about sugar,” says a consumer who has bought two single origin tablets. The chocolates are sweetened with jaggery. The 10,000 sq.ft. store has over 650 SKUs of handcrafted chocolates, from tablets, barks and clusters to bonbons, thins, truffles, pastries and desserts. While a chocolate bar costs between ₹400 and ₹475, a box of 12-piece truffles costs ₹1,500. A 555-gm gift box is priced ₹2,250.

Manam has been founded by Chaitanya Muppala, a second-generation entrepreneur, who thought about launching chocolates for Almond House, a chain of high-end mithai stores in Hyderabad that he inherited from his father. Muppala realised most chocolates tasted similar. “They were making products from chocolate compounds. I started reading about chocolates and realised a chocolate is as good as the beans. I started meeting cacao farmers and saw an opportunity to build a narrative around Indian cacao.”

After several trips to Vijayawada, home to 90% of India’s cacao farmers, Muppala decided to build a farm-to-bar business. He sources beans from over 140 farmers and has built a drying and fermenting facility; from here, the beans are sent to the production unit for conversion into chocolates.

Craft chocolate-making started in France in late 80s when some chocolatiers decided to move away from the industrial process (Valrhona was among first movers). The movement picked up in U.S. in early 2000s with brands such as Scharffen Berger. India has half-a-dozen brands taking baby steps in craft chocolates, including Paul & Mike, Soklat, Mason & Co and La Folie. They are backward-integrated, manufacture in small batches and are priced at a 30-50% premium.

From Bean to Bar

In a country where largest chocolate-maker Cadbury has for decades talked about democratising chocolate consumption, the narrative around ‘craft chocolates’ sounds romantic. A craft chocolate, after all, has a story around it. The beans are sourced from a single farm or farms in a region and fermented and dried as per custom specifications. The chocolates, made in small batches, express the chef’s artistry and uniqueness. On the contrary, the brands most of us have grown up eating are industrial and made from chocolate compounds. The cacao can be from any part of the world and goes through a standard process of fermenting and drying. This is true of even the famed Belgian chocolates. “Everyone thinks Belgian chocolates are the best, but in our world, if I use the word Belgian, people run away. They are industrial products. The cacao is from West Africa where there are drought, deforestation and sustainability issues,” says Martin Christy, founder, Seventy%, and co-founder, International Institute of Chocolate and Cacao Tasting.

But aren’t the likes of GODIVA, Neuhuas and Guylian the ultimate chocolates? They may be premium, but are not craft, says the chef of a leading gourmet retail store. “Craft chocolates have a bean-to-bar story. Customisation is higher. Hence, they often come at a higher premium than GODIVA or Guylian, which are industrially-manufactured,” he adds.

Most global craft chocolate brands such as Goodnow Farms, Fu Wan and Chokoladefabrik hand-pick beans from Latin America. Goodnow Farms (from U.S.), for instance, has a direct relationship with farmers in Latin America, which means it pays them more than fair trade prices. This helps players meet sustainability norms and get the bean fermented and dried as per requirements. Unlike most mass products, which use vegetable fat instead of cacao butter and sugar, craft brands use fresh-pressed cacao butter from the same premium beans.

Business of Craft

When Vikas Temani, founder and business head, Paul & Mike, travelled to Latin America in 2016 to understand the business of cacao, the idea was to give Indian consumers a high-quality premium chocolate. Temani was aware that since per capita consumption of chocolate in India was much lower than the global average, Indians wouldn’t buy an exorbitantly priced bar. “We realised the best way to offer a high-quality product and earn high margins was growing own cacao,” says Temani. The brand cultivates cacao on outskirts of Kochi and Coimbatore. It also buys directly from farmers in West Godavari. Like Manam, Paul & Mike also has a fermentation centre on outskirts of Vijayawada. A 70-gm Paul & Mike craft chocolate (available in variants such as 70% dates sweetened dark chocolate; 64% dark gin and candied ginger and 64% dark rum and raisins) costs between ₹250 and ₹360. “We bring the philosophy of wine-making into chocolate-making by paying attention to every step,” says Temani.

Farmers play a key role in the process. Almost 90% cacao produced in India is bought by Mondelez India. Cacao processing is labour intensive. The crop needs to be pruned twice a year. Harvesting and pulling out/drying seeds is cumbersome. In 2020-21, when palm oil fruit prices shot up (most cacao farmers are palm oil farmers) from ₹6,000 per tonne to ₹24,000 a tonne, many gave up cacao farming. Manam’s Muppala realised they needed an incentive to grow cacao. “Fermenting and drying was additional work and cost for them. We, therefore, built a price-parity business model. We also pay a 30-40% premium,” he says. “We decided to not only generate value for the business but also impact farmers. The idea was to disrupt the profit pool that is skewed towards manufacturers and retailers,” he adds.

Muppala was clear he would build an Indian brand for a global audience. Neither Manam nor Paul & Mike has stereotyped itself with flavours such as kesar, elaichi or badam. The focus has been to make world-class chocolates from Indian cacao. In fact, both the brands have been recognised on international platforms. While Paul & Mike won silver at International Chocolate Awards, Manam was recognised by the International Association of Chocolate and Cacao Tasting.

Though most Indian craft chocolate brands are one-store establishments, Paul & Mike and Manam intend to scale up. Muppala wants to create a market for craft chocolates. “I see Manam as a multi-format retail brand. In next 36 months, we will be in three major metros. We will enter with a karkhana and a store but the idea is to flank that with a tighter retail model like dessert bars or chocolate gifting salons. We will be in international airports and, of course, ecommerce.”

Temani says Paul & Mike doesn’t have immediate plan to set up boutiques. The brand is available in premium retail stores in 14 cities and ecommerce platforms such as Swiggy, Instamart and Blinkit. Temani wants to follow the traditional FMCG way of ensuring that his product is available wide and deep. “Among all craft chocolate makers, our pricing will be more competitive. We want product and pricing that make sense for the Indian market,” says Temani.

In its infancy right now, but the Indian chocolate market has started unveiling its creative might. Indian whiskies and wines have already captured the imagination of the global audience. Indian craft chocolate could be the next big phenomenon.