Barry Callebaut: "Our APAC strategy is boringly consistent...but innovation is crucial for its success"

By Gary Scattergood

- Last updated on GMT

A cocoa plantation visited by FoodNavigator-Asia in South Sumatra.
A cocoa plantation visited by FoodNavigator-Asia in South Sumatra.
Barry Callebaut’s APAC president said the firm’s Asia strategy is ‘boringly consistent’ – namely to be the heart of the cocoa industry in the region – but underlined that constant innovation is needed to deliver on that objective.

Speaking during a press trip to Lampung, Sumatra, Ben De Schryver said that extensive product development, improved sustainability, and deeper smallholder engagement were key priorities.

“Our strategy is boringly consistent, we want to be heart and engine of the cocoa industry.

“We don’t want to do anything else or move into any other commodities. We want cocoa expansion, especially in APAC, which is the consumption market of the future.”

De Schryver said that the company had witnessed double-digit growth in China and India, which remain relatively new markets for the firm.

He also said consumer demand was growing in Indonesia, albeit from a low base. The company opened its first chocolate factory in the country in 2016, in Surabaya

This was part of a long-term outsourcing agreement with GarudaFood Group, one of the largest food and beverage companies in the country, which involved the supply of at least 10,000 tonnes of compound chocolate per year to GarudaFood, as well as the set-up of Barry Callebaut’s own operations.

Not a commodity

It has also recently expanded its factory in Singapore, featuring the installation of a third production line, a chocolate chips/drops moulding line and a warehouse, and opened a BC studio to facilitate the co-creation of products in Bandung, Indonesia, last year.

“Chocolate is a precious product, which requires investment and innovation​,” added De Schryver.

“It is bad to call chocolate a commodity because of all work done through the supply chain.”

He cited the firm’s ruby chocolate​ as a prime example of innovation, and added that green tea flavours and fast melting fillings are performing well in APAC.

“The APAC market is growing at 5.2% CAGR, but it is not just coming from tablet chocolate. We are also seeing the rise of bakery, snacking, on-the-go, gifting and energy food.”

De Schryver added that improving sustainability and providing greater support to smallholders, especially in Indonesia, was a critical factor in ensuring that such levels of innovation could be maintained further up the supply chain.

At present, Indonesia is looking to import 225,000 tonnes of cocoa beans each year. In 2005 that was just 26,000 tonnes. Over the same period, domestic harvests have dipped from 600,000 tonnes to 230,000 tonnes.

Take a look at this video interview with the company’s director of communications for APAC, Nor Badon, who assesses the company’s current sustainability strategy and efforts to improve yields.

There are a variety of reasons why yields are declining in Indonesia, including crop disease, limited smallholder funds, a lack of mentoring and a decrease in government funds.

Take a look at this video, featuring cocoa farmer Sutaji (left) and Barry Callebaut’s Ani Setiyoningrum (right), to see how the company has sought to support smallholders.

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