Cocoa butter market in Sri Lanka

Earlier Report Observations

The cocoa butter market in Sri Lanka contracted from 796.7 t in 2018 to 643.9 t in 2020. This decline was primarily driven by challenges in domestic cocoa production, as local landowners showed disinterest in cultivation despite cocoa's suitability as an inter-crop with coconut. Key issues included disease control, pest damage from animals, and low domestic prices compared to more lucrative crops like cinnamon and pepper. During this period, Ceylon Chocolates Ltd operated as the sole major local buyer with its 'Beans to Bar' factory.

Market volume recovered to 680.0 t in 2021 and then stabilized around 677–667 t through 2023. A significant regulatory change occurred in 2023 when the Food (Labelling and Advertising) Regulations 2022 came into force, imposing new nutritional labelling requirements for confectionery products containing cocoa butter. These rules increased compliance costs for the industry, potentially affecting demand. Concurrently, the coconut sector—closely linked to cocoa as an inter-crop—faced production challenges from climate changes and global supply disruptions, indirectly influencing cocoa cultivation.

Into 2024, the regulatory landscape continued to evolve with further amendments to the labelling rules, while customs tariffs guided the import and export of cocoa butter. The coconut industry experienced a sharp production drop due to drought, pest attacks, and restrictions on fertilizer use, which could impact cocoa inter-cropping systems and raw material availability for cocoa butter production.

Production cocoa butter in Sri Lanka

In kind, 2017-2020, t

Top producers of cocoa butter, 2017-2020

World map of production of cocoa butter, 2017-2020

Sri Lanka's cocoa butter production declined for the second year in a row. In 2020, the country produced 502.5 t of cocoa butter, marking a 20.9% decrease from the previous year. Looking at the period from 2017 to 2020, production fell by 7.4%, which translates to an average annual decline of 2.5%. The highest production level was recorded in 2018 at 804.7 t. The most significant drop occurred in 2019, with a 21.0% decrease, while the largest increase was seen in 2018, with a 48.3% rise.

Annual dynamics of production in Sri Lanka in kind, 2017-2020, t

Exports cocoa butter from Sri Lanka

Exports in kind, t

The data shows irregular changes, pointing to a volatile market environment. Import levels varied significantly, with a 15-fold difference between the low in 2019 and the high in 2018. In 2019, Sri Lanka's cocoa butter exports amounted to 13.0 t, down by 93.5% from 2018. The peak export volume was recorded in 2018 at 199.6 t, with the largest increase that year reaching 886.8%.

Annual dynamics of product's exports from Sri Lanka in kind, 2017-2020, t

From 2017 to 2020, Malaysia and the Netherlands were the primary markets for Sri Lanka's cocoa butter exports in kind, together making up 85.6% of total flows. Other destinations had relatively smaller shares during this period.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from Sri Lanka in kind, 2017-2020

Exports in value, K $ US

Market performance showed noticeable fluctuations over the period. The lowest export value was in 2019, while the highest was in 2018, with a 16-fold gap between them. In 2019, Sri Lanka's cocoa butter export value stood at 35.7 K $ US, which is 93.6% lower than the previous year. The maximum value was recorded in 2018 at 555.3 K $ US, with the largest increase that year at 1 013.3%.

Annual dynamics of product's exports from Sri Lanka in value, 2017-2020, K $ US

During 2017–2020, Malaysia and the Netherlands remained the leading markets for Sri Lanka's cocoa butter exports in value terms, jointly accounting for 86.2% of total flows. Other partners played a more supplementary role in the export structure.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from Sri Lanka in value, 2017-2020

Imports cocoa butter to Sri Lanka

Imports in kind, t

The data reveals irregular changes, indicating a volatile market environment. Import levels bottomed in 2017 and peaked in 2018, with a 2.3-fold difference between these years. In 2020, Sri Lanka's cocoa butter imports reached 141.4 t, up by 54.0% from the previous year. The maximum import volume was recorded in 2018 at 191.6 t. The largest decline occurred in 2019, with a 52.1% drop, while the largest increase was in 2018, with a 133.9% rise.

Annual dynamics of product's imports to Sri Lanka in kind, 2017-2020, t

Over the period from 2017 to 2020, Singapore and Ghana were the main sources for Sri Lanka's cocoa butter imports in kind, together accounting for 85.2% of total flows. The remaining share was distributed among other markets.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to Sri Lanka in kind, 2017-2020

Imports in value, K $ US

The market exhibited an unstable trend throughout the timeframe. The lowest import value was in 2017, and the highest was in 2018, showing a 2.1-fold variation. In 2020, Sri Lanka imported a total of 872.3 K $ US worth of cocoa butter, representing a 61.5% increase from 2019. The maximum value was recorded in 2018 at 981.4 K $ US. The largest decline was in 2019, with a 45.0% decrease, while the largest increase was in 2018, with a 110.8% rise.

Annual dynamics of product's imports to Sri Lanka in value, 2017-2020, K $ US

From 2017 to 2020, Singapore consistently dominated Sri Lanka's cocoa butter imports in value terms, accounting for 73.7% of total flows. This indicates a high concentration on this market, with the rest shared among other countries.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to Sri Lanka in value, 2017-2020