Thursday, September 26, 2002


chocolate = happiness

i certainly like the theme of the new proposed hershey chocolate ad campaign. who wouldn't? however i might disagree with the idea that a hershey bar is the platonic ideal of chocolate. . .the ad agency just isn't gonna make that one fly for me.

normally the markets aren't my idea of an interesting topic, but this year has been an extraordinary one for the cocoa market. first a british trader makes himself a gazillionaire by cornering the market in cocoa. apparently he bought himself a fancy long-term weather forecast that showed bad weather would reduce the harvest, and started buying cocoa futures like mad.

now the growing social instability in the ivory coast, which grows nearly half of the planet's chocolate, is pushing up the value of his investments even more. all this had led to worried news articles that the price we pay for chocolate candy would skyrocket.

no, no, no. i seriously doubt it! here's why: the cost of cocoa is just 10 percent of the end price of our chocolate bars. while droste and nestle have raised chocolate prices about 4 percent, it doesn't seem like that's being passed on to the consumer right now. and even if it were, say you're paying US$2 for a lindt bar or US$3 for valrhona. a 4-percent increase would only be something like 12 cents! a small price to pay for happiness. . .

long-time readers know i've spent what seems like years now nattering about the problems caused by the world-price depression in coffee. how the low prices are leading to bankruptcies, starvation, the loss of quality coffee plantations, forced migrations, an increase in the production of illegal drugs. . .all that bad stuff i've talked about here endlessly. i feared the mainstream press would never pick the problem up.

but starting this summer with an article in the wall st. journal, the story is slowly gaining ground in the major media. which appears to be par for the course this whole year, that some of the most interesting and profound stories (enron!) have started in the business pages before they broke out to the wider social and political scene. . .

posted by fortune | 6:11 PM | top | link to this | email this: | | | 0 comments