A sweet trade imbalance?

Foreigners buy our beef. Iron ore, too. And our wool. But our chocolate? It’s a harder sell, but not impossible.

The demise of Sydney-based chocolate maker Darrell Lea, which went into administration after 85 years in business as a family-run concern, raises a question. If we can’t sell the stuff to ourselves, could we do any better selling it overseas?

On one score, the booming Asian middle class would appear to be a logical market for Australian-made chocolate. Global consumption of cocoa is forecast to rise 25 per cent to 5 million tonnes by 2020. But don’t think for a moment chocolate makers in the countries of Asia are going to stand aside and let us eat their lunch. In fact, they’re eating ours. Australia already imports twice as much chocolate as it exports. Last year, we bought $835 million worth of chocolates and confectionary and exported just $359 million worth. In that equation, Australia sold almost $22 million worth to Singapore – and imported $109 million. And China? Well, we imported $67 million worth from the People’s Republic of Confectionary last year. And sold them none.

Australia is close to chocolate parity with New Zealand. Last year we imported $125 million in sweet things from across the Tasman, while they imported $161 million worth from us.

Given that chocolate is just a sweetened form of manufacturing, the rules apply to chocolatiers just as they do to metal-bashers. Churning out slabs – be they iron ore or Dairy Milk – is always going to be cheaper in a country where the costs of labour are a fraction of ours and the inputs – milk and sugar mainly – are locally available. Cocoa powder is imported by most places, so nowhere, except perhaps a few West African countries, have an advantage there. Don’t try to compete on price. Pick a niche.

While mass-market Darrell Lea is melting, boutique chocolatier Haigh’s seems to be doing well enough, even though it has a tiny 2 per cent of Australia’s $1.9 bn chocolate retail market – half the size of Darrell Lea – according to research firm IbisWorld.

But how could Australian chocolates, even high-end ones, compete with big global brands such as Lindt, Guylian and Godiva, which back up their dominance of the global taste for luxury with great marketing budgets? The only hope, as Melbourne-based chocolatier Hanna Frederick puts it, is to tell a local story – and tell it to anyone overseas who will listen.

Hungarian-born Frederick, who runs a small business, Mamor (“ecstasy” in Hungarian) Chocolates in Collingwood, makes an eclectic range of chocolates that includes one with kangaroo salami (to me, indistinguishable from any praline filling) and one with lemon myrtle and feijoa. It will still take a year before Frederick is in any position to look at exporting, but she has both China and the United States (where they like new things, she says) in her sights.

“You can’t afford to have good chocolate and no story,” she says. “I’m no Cadbury.”

The headline-grabbing nature of a kangaroo salami chocolate obscures the hard work – and cost – needed to break into any market. But ranges of high-end Australian chocolates that offer something the chocolate superpowers can’t could one day – along with beef – sweeten our balance of payments.

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