Chocolate makers tempt Japan's sweet tooth

TOKYO (Reuters) -- Japanese are munching their way through more chocolate than ever, but local manufacturers are not satisfied and have launched a string of new products and positive health campaigns to target the country's sweet tooth.

A campaign to change the belief that chocolate is bad for you and new types of tempting snacks helped push chocolate consumption to a record high last year, industry officials say.

But despite some success, Japanese makers have their work cut out persuading people to eat more chocolate instead of traditional sweets, whose light taste is more in tune with the Japanese palate, industry experts say.

On average, Japanese ate 1.7 kg (3.7 lb) of chocolate per person in 1999 up from 1.62 kg (3.56 lb) the previous year and passing the previous peak of 1.67 kg (3.67 lb) in 1991, according to the All Nippon Kashi Association, an industry body.

Japanese chocolate output rose 5.3 percent to 200,600 tons in 1999 with retail sales worth 416 billion yen ($3.84 billion), up 5.2 percent and bucking a slide in confectionery production as recession-weary consumers remained thrifty.

Industry officials expect consumption to rise again this year as producers try to close the still huge gap with European and U.S. levels of consumption.

The Swiss are the world's biggest chocolate eaters, devouring an average 9.7 kg (21.3 lb) a year, followed by Germans who chomp through 8.5 kg (18.7 lb) and Americans on 5.3 kg (11.6 lb).

Manufacturers have turned to science to try to change habits, bombarding the public with advertisements proclaiming the potential health benefits of chocolate, though most doctors and dentists would probably disagree.

The campaign is based on scientific evidence from the mid-1990s showing that polyphenol, a natural antioxidant in cocoa beans as well as red wine, can lower cholesterol and fat levels.

"Consumption rose last year as the industry's campaign stressing the health benefits of chocolate finally had the effect," said Fumio Sukegawa, director of the Chocolate and Cocoa Association of Japan.

Manufacturers have capitalized by making products with high polyphenol content and adding names such as "Benefits of Cocoa."

To entice more buyers, even during the hot summer, Japan's five major chocolate makers -- Meiji Seika Kaisha Ltd, Lotte Co, Morinaga & Co, Ezaki Glico Co Ltd and Fujiya -- are constantly coming up with new products.

"In Japan, chocolate sales during summer are about half of average monthly sales," said Yukio Kuwada, manager at Meiji Seika Kaisha's product planning department.

In an attempt to boost summer sales Meiji, Japan's top producer, has come up with a new kind of chocolate that is as cold as ice cream. To keep it soft in the fridge, vegetable fat, including palm and rapeseed oils, is added to cocoa butter.

The latest chocolate hit is a cocoa-flavor stick biscuit coated with whipped chocolate that is as light as mousse.

The new snack was first launched by Meiji last September, followed by Ezaki Glico in January.

Meiji's product, "Fran," notched up sales of nearly seven billion yen ($64 million) in nine months, while Ezaki was forced to halt sales of its "Mousse Pocky" a few weeks after starting marketing because it could not keep up with demand.

Traders expect such efforts to help chocolate production post a modest rise this year.

The five major companies' account for about 70 percent of the domestic market and although foreign makers have stepped up efforts to boost sales, they have had little success so far.

The share of foreign chocolate in the Japanese market fell to 7.5 percent last year from a recent high of 8.5 percent in 1997.

A major reason -- and the big hurdle faced by domestic makers -- is the choice Japanese have when it comes to sweets.

Japanese sweets such as wagashi, which is made of rice and red beans, account for the biggest share of Japan's total confectionery market with 18 percent. Chocolate takes about 10 percent, according to the All Nippon Kashi Association.

"Foreign makers say they wonder why rich Japanese don't eat foreign chocolate," said Sukegawa at the Chocolate Association.

"The chocolate industry has big rivals such as wagashi and rice cakes ... Japanese are rice-eating people and prefer lighter-tasting sweets."

Copyright 2000 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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