Europe's economic crisis is nibbling away at demand for chocolate, the affordable treat once thought of as recession proof.
Times are tough enough now that even the market for this modest luxury is struggling in Europe, analysts say.
"For the first part of the recession we thought chocolate would be recession proof, and then we said recession resistant, and now I think people are just getting ground down," said Marcia Mogelonsky, global food and drink analyst at Mintel.
"I have not seen this much of a slowing in the market in the time I've been watching it."
Market researchers Mintel said that while the global chocolate market value will be little changed on the year at $84.5-billion (U.S.) in 2012, Western Europe's chocolate market value is set to fall by around 5 per cent.
"Chocolate usually does better than average fast moving consumer goods because chocolate is the archetype of cheap indulgence so it's the last thing people will drop," said Jean-Jacques Vandenheede, European director for retail insights at research firm Nielsen.
The firm recorded its first ever fall in volumes for the fast moving consumer goods sector – made up of low value items which sell quickly – in the second quarter of 2012 since it began monitoring it in 2007.
"If the economic outlook continues to be as sombre as it is now people are not going to rally, they are going to hunker down even more, and spend even less on food, even on chocolate," Mogelonsky said.
The firm estimates Western Europe's chocolate market value in 2012 will fall to around $30-billion, from $31.7-billion the previous year.
Europe and North America are the largest and most mature chocolate markets, which prohibits growth to an extent.
"You have to bear in mind the market is pretty mature so there's not much room for volume growth – regardless of the economic environment – in most Western European countries," said Lee Linthicum, global head of food research at Euromonitor International.
Portugal and Italy will see some of the sharpest falls in market value in Western Europe for 2012. Mintel forecast, at minus 11 per cent and minus 7 per cent respectively.
The world's largest chocolate products maker Barry Callebaut has said that during the first nine months of its fiscal year 2011/12, double-digit sales in the Americas, Asia and eastern Europe helped offset still sluggish demand in southern Europe.
Mintel data showed the bright spots for growth were in emerging markets in Asia including China, Indonesia and Vietnam, but these countries were starting from a low base.
China's market value was expected to increase by 16 per cent in 2012 to $4.6-billion, while Vietnam was up 11 per cent at $170-million and Indonesia was up 9 per cent to $1.2-billion, according to Mintel figures.
The slowdown in chocolate demand has filtered through to the cocoa market, with cocoa futures on Liffe this week falling to their lowest level since July 25.
European cocoa traders said slowing chocolate demand and poor cocoa processing margins triggered the resale of cocoa beans by major processors last month.
Europe's second-quarter cocoa grind, an indicator of cocoa demand, recorded its sharpest quarterly fall of 17.8 per cent from the same period last year, Brussels-based European Cocoa Association (ECA) data showed in July.
Third-quarter grinding data is due to be published by the ECA on October 11 with expectations for further slippage as some traders predicted a fall of up to 20 per cent versus the same period last year.