Rethinking chocolate: Cocoa butter replacements proliferate but farmers at risk

The cocoa sector is addressing its climate, supply, and ethical sourcing pressures by exploring sustainable substitutes to cocoa butter — the fat that gives chocolate its smooth texture, snap, and melt-in-your-mouth quality. But as interest in replacements grow, so do concerns over their potential impact on farmer livelihoods.

Over 90% of global cocoa comes from five to six million smallholder farmers, mostly the key growing regions in rural Côte d’Ivoire and Ghana, which face volatile prices and limited market access. In these regions, climate extremes drove a 300% spike in global cocoa prices by April 2024 compared to 2023.

Cocoa butter substitutes help manufacturers mitigate these challenges by replicating the unique sensory properties of the natural fats obtained from cocoa beans. Volatile cocoa prices have also led to a spike in demand for cocoa butter alternatives.

“When cocoa prices surge, manufacturers urgently seek alternatives that can mitigate cost pressures without compromising quality. This trend is particularly pronounced among B2B food professionals who must balance profitability and product performance,” Christiaan Middelhoven, global head of Chocolate Confectionery Fats and Bakery at AAK, tells Food Ingredients First.

The Sweden-based firm’s cocoa butter equivalent (CBE) Illexao EN 10 “closely mimics” cocoa butter, enabling smoother, more efficient enrobing with less downtime, reduced buildup, and better machine performance, says Middelhoven.

Meanwhile, Israel-based Celleste Bio formulates chocolate-grade cocoa butter using plant cell culture technology to build a climate-resilient cocoa supply, says CEO Michal Berresi Golomb.

She attributes the sector’s challenges to “climate change, disease, pest, labor, and deforestation,” as the demand for the US$120 billion chocolate industry continues to increase year-over-year.

“Cocoa butter is the single most important ingredient in chocolate — you can’t call chocolate ‘chocolate’ without it — yet it’s the most expensive, resource-intensive part of the process. Using cell culture to grow and produce it enables a waste-free, sustainable, consistent way to deliver cocoa butter.”

Cocoa butter advancements

Celleste Bio’s cell culture technique replicates what happens in nature “in a controlled setting with zero waste and high efficiency.”

“We extract cells from the cocoa bean, grow them in vitamins, water, sugar, and they create a biomass. From that biomass, we can extract the butter and powder and then return the biomass to continue replicating,” Golomb explains.

Planet A Foods’ microbial cocoa butter identical releases cocoa powder aroma “slowly and continuously” through its unique melting, says Schmitz.“It takes us about 10 days to grow a ‘new crop’ under optimal conditions, where traditional farming takes 7–21 years with no guarantees.”

Meanwhile, Germany-based Planet A Foods uses precision fermentation to formulate CBEs, aiming to overcome challenges such as inconsistent cocoa butter properties between different batches, origins, or suppliers, Kevin Schmitz, lead of Microbial Fats at the firm, tells Food Ingredients First.

“Precision fermentation allows local production decoupled from tropical growing regions using local sugar and molasses as feedstock in fermentation (cheap bulk ingredients, stable supply chains), and consistent batch-to-batch product quality and properties.” It also offers exact replication of cocoa butter composition in products, which the company refers to as “Cocoa Butter Identical” (CBI).

CBI and cocoa butter taste neutral, with confectionery fats in general being taste and aroma “enablers” rather than direct taste and aroma “providers,” Schmitz explains.

The process begins by feeding yeast with sugar (or molasses) in large fermenters, allowing them to build up fat reserves under optimal nutrient conditions.

“We then harvest the ‘ripe’ yeast cells and crack them open to extract the fat in a gentle, solvent-free process. Lastly, our fat is purified via a regular refinement process (which all fats and oils from plants and vegetables undergo),” adds Schmitz.

Cost and sustainability

While cost remains a primary driver, many CBE manufacturers are increasingly focused on environmental impact and ethical sourcing. These focuses push companies to evaluate fat systems not only on price, but also on “life cycle impact, traceability, and sustainability certifications,” notes Middelhoven.

Cell-cultured cocoa may offer cost parity and tailored premium varieties for luxury markets, says Golomb.“By using CBEs in recipes, manufacturers can tailor functionality, stabilize prices, and improve resilience against ingredient shortages. These blends offer flexibility in formulation, allowing for adjustments in response to market shifts.”

Meanwhile, Golomb expects the economics of cell-cultured cocoa to be advantageous to the industry. “The objective would be for these ingredients to be priced at parity, and below where applicable, with the rest of the industry.”

She also points to the benefit of cell-cultured cocoa being “food and beverage ready,” with Celleste Bio’s computational modeling customizing it to specific needs from the onset of development. This process reduces trial and error, iterations, and waste, in turn improving the ingredient’s cost effectiveness.

Alternatives: A threat to farmers?

While cocoa butter substitutes may help manufacturers during cocoa price crises, they present “real” risks for smallholder farmers, says Kerry Daroci, director of the Americas at the Rainforest Alliance, which promotes sustainability across agricultural and forestry sectors.

“If alternatives capture significant market share without deliberate intervention, we could see demand erosion that devastates already vulnerable communities — particularly in West Africa, where cocoa represents up to 40% of export earnings in some countries,” Daroci tells Food Ingredients First.

“Volatile prices, climate shocks, and exploitative market structures mean many can’t afford to stay in cocoa anyway. The question isn’t whether change is coming — it’s whether that change will be managed equitably or leave millions behind.”

However, she views replacement solutions as both a threat and an opportunity for sustainable cocoa farming.

Using cocoa butter equivalents in recipes supports consistent functionality and greater resilience amid ingredient shortages, says Middelhoven.“Innovation in alternatives could reduce pressure on forests and offer climate-resilient options as cocoa-suitable land shrinks. That’s valuable — but framing this as sustainability progress while ignoring the human cost is a dangerous misrepresentation.”

“True sustainability means positive environmental and social outcomes. If alternatives displace demand without ensuring farmers transition to viable livelihoods, we’ve simply traded one problem for another. The opportunity exists if and only if innovation is coupled with investment in farmer diversification, agroforestry systems, and fair transition support.”

Meanwhile, Planet A Foods aims to “complement, not disrupt” cocoa butter solutions, by offering a “cheaper yet premium alternative,” says Schmitz.

“Cocoa Butter is a premium and unique product, and will always have its place in our food and sweet indulgence. But it is sought after more than it is available. It is expected to become less and less affordable for many product categories in the confectionery space.”

Supporting responsible cocoa

Daroci at the Rainforest Alliance calls for a just transition that treats farmers as “stakeholders, not collateral damage” to support responsible cocoa sourcing.

“Chocolate manufacturers should commit to sourcing both responsibly-produced cocoa and sustainable alternatives — not one replacing the other. Before scaling alternatives, companies must conduct human rights and livelihood impact assessments in source countries.”

Companies creating alternatives should support farmers in diversifying into viable new crops, Daroci suggests.Daroci also emphasizes the need for multi-stakeholder governance through collaborations between innovators, traditional cocoa buyers, farmers, and organizations like the Rainforest Alliance to ensure “innovation serves, not undermines sustainability goals.”

Sustainability groups must help bridge innovation and justice by verifying substitute claims without overlooking social impacts and amplifying farmer voices in decision-making spaces.

“The chocolate industry stands at a crossroads. One path leads to technological substitution that leaves farmers behind. The other integrates innovation with investment in people and landscapes. At the Rainforest Alliance, we’re working to ensure the industry chooses the latter — because sustainability that abandons communities isn’t sustainable at all,” Daroci concludes.

Nearly 75% of EU consumers say that sustainability influences their chocolate choices. But with cocoa becoming scarcer and more expensive, price remains a major barrier for consumers to buy more sustainable products. Cargill explored its cost-effective, no-cocoa alternative to chocolate in a recent webinar with Food Ingredients First.