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I rarely take a public position when it comes to chocolate companies, but a recent statement in a video brought me up short. Before I go on, I do have to say that what Rick and Mike - and everyone involved - have done is phenomenal. They were in the right place at the right time with the right product with the right ethos, capturing the cultural zeitgeist perfectly - guiding and riding it expertly.

But I have never been a huge fan of the chocolate they make, or more properly, their skills as chocolate makers. I don't mind vintaging in wine where the differences in a particular bottle occur from year to year. My issue with the Mast Brothers stems from the fact that I never know what I am going to get from batch to batch of what is ostensibly the same chocolate. If I find a decent bar and go back several weeks later to get another of the same, it will be different. Sometimes very different. And sometimes difficult to recognize as being the same chocolate. Yeah, I know, small batch variability and all that. When the Mast Brothers are on, they turn out good chocolate - but too often I am left wondering what all the fuss is about. I've even had bars with rancid nuts, purchased fresh from the factory store.

Going back to the video: At just after 3:00 minutes in, Rick claims that they've paid up to 10x the average price for commodity beans (and 3x-5x market price more generally).

Last Friday's spot closing price was $2352.94 per MT (metric ton, 1000kg), down from over $2800/MT in November, 2011. If what Rick is saying is true, then at some point in the last six months they paid between $23,000 and $28,000/MT for beans. 18 months ago, 10x market would have been nearly $40,000/MT.

Really? I'd like to see the paperwork supporting those claims.

If it's true, and the farmer actually received 10x market for their beans, then that's good news and I will be the first out the gate to let people know about it.

But - if it's not true - what are the implications and potential ramifications for the craft chocolate industry? Not just for the Mast Brothers, but for every craft chocolate maker who is trying hard to improve the lives and livelihoods of the cacao farmers they source from.

Your Thoughts?


Do some math. Is it possible to pay $25,000/MT for beans and make a 2.5 oz (71gr) bar of chocolate that can be sold (profitably) for $7?

At $25,000/MT raw, whole beans in multi–ton quantities cost about $11.35 per pound. By implication in the video, that money is paid to the farmer and therefore would not include customs, insurance, freight, and other costs, so the calculation understates the actual landed price of the beans and therefore the following cost basis is low.

Assume an 80% yield on those beans (i.e., every 100 lbs of beans yields 80 lbs of usable nib after roasting and winnowing - this is generous) raises the price per pound of nib to about $14.15. Assuming a 70% cocoa content chocolate, that means that the cost of just the cocoa nib component of a pound of chocolate is north of $9.90 - also assuming zero loss in the process of making the finished product.

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To some degree you're right.  I get a tremendous amount of press as well, have been on the front page of every local newspaper, front and center on regional television as well, and have had some of my recipes published - in all over 40 different media appearances/publications.

When you talk to people who are IN the chocolate industry, many people have heard of me.  Chances are they have read something I've written, or some review about me somewhere online.  However outside of the chocolate industry it's a different story and there's a good reason:  Almost nobody pays attention to traditional media these days.  The proof is in the pudding so-to-speak.  In the past 3 1/2 years, in spite of garnering 10's of thousands of dollars worth of free press in a community of a million people, less than 5% of our gross sales has some from it - 5 % of over 52,000 transactions!   What's even more interesting, is that in the weekly events I host in my shop, while everyone claims to love chocolate only 25% of the attendees have ever heard of Choklat.  After 3 1/2 years of publicly kicking sand in the faces of every local chocolatier, only 25% of the population has heard of me!

Having said all of that, when you look at the size of New York, or even the US in general (10X the population of Canada), I think you'll find that very few people will have heard of Mast Brothers in spite of all the press they get, UNLESS of course, that person is IN the chocolate industry - and most people aren't in the industry.

I think their words will have more effect on those in the craft chocolate industry, but based on the market research that I continue to do, their words will have a negligible effect on the general public - largely because they didn't hear what Mast Bros said in the first place, and secondly because a large portion of the general public simply doesn't care.

Now, having said all of that, I'm in no way diminishing what you offer here to the chocolate community.  It's been a valuable resource for me, which is one of the reasons I keep contributing.  However I think if you poll your thousands of members, I think you'll find that almost all of them work with chocolate in some capacity - they aren't just end consumers.

Again, I think it's great that we police each other in this industry, and this popular forum is a great way of spreading the word.  However on the grand scheme of things, what we say here will have almost no effect on the general public - kind of like screaming in a vacuum.

I'm completely fine with agreeing to disagree on some levels, but would like to say that I vehemently agree with your stance on deliberate misrepresentation.  I'm just trying to be pragmatic in my assessment of the level and scope of potential misrepresentation. For example:  You have 5,000 members (I'm guessing).  I'm also guessing (optimistically) that another 5,000 people lurk this forum.  That's 10,000 people out of the 350 million people in North America alone - or about one person per city.  How many of those people do you think will care enough about what Mast Bros (or any other chocolatier for that matter) say to be the town cryer and convince others to change their buying habits?  Like I said.... Hardly a ripple to the general public - which is probably a good thing, as maybe what he said was a slip of the tongue, or he was a bit "enthusiastic" about his product.  In the end is that one sentence any better or worse than the majority of chocolate shop employees who claim their owner makes chocolate in the back?  What's worse?

Noka Chocolate is the poster child for this example.  How many people in the chocolate industry would actually "Pay" for one of their outrageously priced and pretentious confections? Certainly not I or you!  Yet they still do great business in spite of the negative comments available on the 'net.  Most people don't know, and many don't care.

...just my thoughts.



Noka Chocolate is no longer in business.  Their brand management has become a textbook example of what not to do.  (See Chapter 7 of Dr. Eric Anderson's Social Media Marketing: Game Theory and the Emergence of Collaboration.)



After reading your post I went online and found DallasFood's 10 part article on Noka.  It was great, and epitomizes what I've been talking about here in Calgary for a few years.  It's much better written than anything I could come up with, and I'm personally glad that Noka's out of business.


Cheers and thanks for the update.


I also just read through the articles.  Very interesting and well done. 

Well done Scott. I read your series on Noka years ago and thought it was excellent. Congratulations on helping to bring more integrity and transparency to fine chocolate. Exactly why this discussion is important, we need to be consistent about information that goes out to the public, there is so much misinformation around chocolate, we all need to do what we can. 

FYI: my business is about doing educational tastings in the SF Bay Area, and I am always learning more about chocolate (aren't we all?) so I appreciate this forum tremendously. I aspire to contribute more here. 

Sunita de Tourreil

The Chocolate Garage

I have to put my two cents in here. I am from Adelaide, South Australia, and while I have never heard or seen anything to do with Choklat outside of these forums, I have heard and seen Mast Brothers Chocolate everywhere. Even in Adelaide it's not uncommon for people to know them and any serious chocolate lover will know them. Their chocolate is stocked in at least two- three places here in South Austrlaia and countless more in Sydney and Melbourne. I have to say I really agree with Clay as I am actually considering starting my own experiments with producing chocolate and the price I should pay for Cocoa beans is very relevant. This whole discussion is very relevant, hence me sitting here reading through anything and everything about chocolate and what people think of other craft chocolate producers.


Mast Brothers ships their product.  Choklat doesn't. It makes sense that the Mast Brothers would be more well known, as more people all over the world have access to their chocolate.  That doesn't mean their chocolate is any good though.  In fact, given their very limited production ability and the fact that they are in the center of a wealthy city with a daytime population of over 8 million people and need to sell outside of their geographic region, I would seriously question their quality.


If the locals aren't buying it...


Conversely, my business is in a city 1/8th the size and we can barely keep up with demand.  In fact some days I'm very happy a lot of this city still hasn't heard of my business (I don't advertise).  Why would I care what the rest of the world thinks of my product or business if my supply is constantly sold out locally?


...and anything more than $10k for a ton of beans is a load of bunk in my opinion.  Either that, or the buyer got played.



People listen, pay attention, and measure others' performance by what they say.

If my work is being judged or assessed by others because of  the spin some hipsters with deep pockets in Brooklyn say, as opposed to the actual quality of the product, then this industry is doomed.

I have not been out to visit the Mast brothers since last fall but have bought some of their bars since at a variety of locations.  I like it but am still a novice.  I also love what they are doing and hope to somewhat replicate what they are doing but working within the Dominican Republic.  The whole pricing and grading thing will be closely examined on my next trip to the DR after having the ability to ask the right questions, primarily from participating on this board.   Last summer I bought a 100 pound bag of fermented (Hispanola in the DR) beans from Cooproagro (formally block 1 of Conacado) for about US$190.  The commodity price was around $3,000 at the time and farmers were getting around $144 for 100 lbs. for Sanchez which is unfermented and around $158 for fermented.  All the fermentation, beyond a couple of farmers in the areas I work, is done by the bigger producers or the farmer cooperatives.  Farmers are now encouraged to get the cacao wet to one of these fermentation centers but I still do not know how that is priced from the farmer's perspective.  The price for cacao is pretty much the same whether a farmer is a member of a cooperative, associated with a major producer or sells independently from what I know.  I will have more to add in July.

About a year ago I read an article somewhere and then saw a video on the Mast Brother's website about them bringing, I think 20 tons of beans from the DR to NYC on a sailing ship.  Very interesting and on one of the bags I saw the name of the farmer's cooperative in the DR.  About 3 weeks into my trip and after asking around at Conacado, I rode my motorcycle and found the Red de Guaneco and spoke with a women who manages the cooperative.  Found out that there has been 5 or 6 Peace Corps volunteers who have worked with the community over the last decade and the last two or three focused on supporting the cooperative.  US AID funded much of the construction of the buildings, fermentation boxes, and the plastic covered drying areas.  They sell dried beans, and cacao powder which is processed for them in country, and she will make you hot chocolate to drink when you visit.  It is a mini version of the blocks which feed into Conacado.  There is a list of the 100 members of the Red and how much cacao each supply.  I did not get details about grading and pricing but discussed their dealings with Mast Brothers and Taza where I also saw a video implying they developed and supported the farmers in this cooperative without mentioning Peace Corps or US AID. 

The big players like Rizek, Roig, Munne, and Hermanos Cortes may also supply them quality beans but I seriously doubt the farmer is getting more than their $158 for 100 pounds (now it is less) of beans which are fermented in the cooperative.  The cooperative then receives US$800 a ton more than the commodity price for Hispanola when sold on the open market.

I would love to know what Hector Rizek sells his beans for to Michel Cluizel for the Los Ancones bar which has the Rizek's ID'ed on the back.  When you open up the book on chocolate  sold in the store, a big picture of Don Rizek is on the first page looking over a couple workers on a farm.


Unfortunately, the chocolate industry is not immune from manufacturers claims that don't match reality; the example of Hawaiian Vintage Chocolate immediately comes to mind. Thus, there is ALWAYS a place for questioning and criticism. As the creator and moderator of TheChocolateLife - and the creator of - this is something that I've been doing for well over a decade. Those who have followed my work know that I come from a place of deep respect for, and interest in growing, the craft and artisan chocolate community and markets.

Those who've followed my writings here and elsewhere know that I am skeptical of the value of the minuscule "investments" being made in sustainable cocoa production by major manufacturers. 

It's important to remember that 99% of the people who see the video have no understanding of the market for cocoa - and that includes many people who consider themselves to be chocolate connoisseurs - and what the price paid for cocoa really means.

If the 10x was paid to the growers, then that's interesting to know, especially if the price paid reflected a premium for quality. However, if the price paid did not go to the grower, but went to middlemen, brokers, and/or shippers, then the statement is disingenuous and misleading in many ways - most important of which is that most people outside the chocolate industry automatically assume that growers always benefit from higher prices.

While I may have been off-target in wondering about the profitability of making a chocolate bar whose primary ingredient cost 10x market price, it is an interesting exercise to lead people through, especially for those who make, or are looking to make, chocolate from the bean. Brad's analysis is a cogent one, but I think fails to take into account the cost of doing business in New York City (much higher than Calgary).

In the end, I think that virtually all chocolate is underpriced in the sense that very few chocolate makers are paying a price for beans that represents the true cost of self-sustaining production. Chocolate lovers are in for a rude awakening over the next decade as demand increases and the supply cannot keep up, in part because of a serious lack of investment in farms in major producing areas over the past two decades. Thus, it's more important than ever to question the prices being paid for beans and to understand how much of the money being paid actually makes it back to the grower.

Hi Clay,

I'd like to clarify some of the math that you did.  You said:

"Do some math. Is it possible to pay $25,000/MT for beans and make a 2.5 oz (71gr) bar of chocolate that can be sold (profitably) for $7?

At $25,000/MT raw, whole beans in multi–ton quantities cost about $11.35 per pound. By implication in the video, that money is paid to the farmer and therefore would not include customs, insurance, freight, and other costs, so the calculation understates the actual landed price of the beans and therefore the following cost basis is low.

Assume an 80% yield on those beans (i.e., every 100 lbs of beans yields 80 lbs of usable nib after roasting and winnowing - this is generous) raises the price per pound of nib to about $14.15. Assuming a 70% cocoa content chocolate, that means that the cost of just the cocoa nib component of a pound of chocolate is north of $9.90 - also assuming zero loss in the process of making the finished product."

It looks to me like there may be some mistakes in the calculations you used.  Here are some calculations that I made:

Assume $25,000/MT

80% yield means that 1 MT yields 800 kg of cacao nibs.

So 800 kg costs $25,000.

$25,000/800 kg = $31.25/kg or $.03125/g

Mast Brothers bars are 71g.

70% of each bar is cacao so 1 bar has 49.7g of cacao.

Putting it all together: $.03125/g x 49.7g cacao = $1.55/bar for the cacao.

Add in the cost of the sugar and they still make a profit.  If they paid 5x then the cost per bar is only about $0.80.

Of course, this ideal yield with no other losses, so their profit margin is still lower, but it does seem feasible.

The Mast Brothers also claimed "up to 10x" so it's not at all clear how much cacao they bought at this price.  I might suspect that it was a very small percentage of their total volume.

I'm not being critical; I'm just trying to get accurate math.  You're right that this was an instructive exercise to do.

I also think that you point about asking how much of this profit actually got to the farmers is spot on.


Not to split hairs here, but you're assuming that the 70% cocoa content is 100% cocoa nib.  It may not be.  In fact very few chocolate companies use 70% beans, as the fina. cocoa butter content is too low and makes the chocolate thick and hard to work with.

I tried to look at their website to get a more accurate percentage, but there's essentially nothing about their bars on there.  I would hazard a guess that it's most likely a 55/15 split between cocoa beans and cocoa butter. However this is just a guess.  If I am accurate, then given the price of their beans in relation to the cocoa butter they buy, it would only bring their cost down a bit more.



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