ANNE ASHWORTH appears to be like at how chocolate can sweeten your portfolio

The British are forecast to consume no fewer than 382million Easter eggs this weekend – on which we will have spent £3.2billion.

The price of the average egg has soared by 9 per cent since last year, according to a Worldpanel survey – in what has been dubbed ‘Easter Eggflation’. Despite this, we have been buying larger, more expensive seasonal treats.

This evidence of pricing power is enough to make chocolate-lovers and everyone else ponder on the investment opportunities that may be on offer at the big stock market listed names in the ‘choconomy’ sector: Hershey; Lindt & Sprungli; Mondelez; Nestle; and Barry Callebaut – the world’s number one manufacturer of cocoa products.

Global chocolate sales are forecast to increase from about $130billion (£98.5billion) at present to $180billion (£136billion) by 2035, even as the popularity of some legacy food brands is fast waning. The wish to dodge this downturn lies behind Unilever’s decision to spin off Hellmann’s and its other long-established ranges in an £11.9bn deal confirmed this week.

Investing in chocolate now is a bet on the widespread passion for this substance remaining undiminished at a time when household budgets are squeezed.

It’s a ‘lipstick-effect’ gamble, taking a chance on the likelihood that, in hard times, small indulgences can be deemed indispensable. Households bills are set to jump, but will people still spoil themselves? If you believe so, then this is how to snatch a bite of the choconomy.

WHY FUTURE COULD BE SWEET

Some of the major choconomy players are in a turnaround process under

new chief executives. These bosses are also being obliged to confront huge external challenges.

The war in Iran is raising fertiliser, packaging, transport and other costs as a result of the closure of the Strait of Hormuz. Meanwhile, weight-loss drugs are altering tastes.

But Ole Hansen, head of commodity strategy at Saxo Bank, argues there is ample proof of the ‘enduring value of chocolate – both economically and culturally – at a time when broader sentiment remains fragile’.

Hansen cites the worldwide attention sparked by last month’s heist of a consignment of 413,723 of Kit Kat’s new Formula 1-themed bars while en route to Poland from Italy.

But Nestle, maker of Kit Kat, turned the crime into a social media moment that underlined chocolate’s allure.

Following the incident, the Swiss giant’s spokesman said: ‘We’ve always encouraged people to have a break with a Kit Kat – but it seems thieves have taken the message too literally and made a break with more than 12 metric tons of our chocolate.’

REASONS TO BE CHEERFUL

Ozempic and other ‘fat jab’ drugs may make alcoholic drinks less palatable, but a bar of milk or plain seems to have that special something.

Chris Beckett, consumer goods analyst at Quilter, said: ‘The large chocolate companies have many grounds to be positive right now. Their brands are strong – and there is little sign that healthier habits are disrupting this market in the same way that alcohol has been hit.’

Beckett argues that the most significant problem facing the industry is not conflict in the Middle East, but the outlook for cocoa prices.

It soared to $12,000 in late 2024 due to supply shortage, but subsequently moderated, as some manufacturers re-tooled their equipment to use less cocoa. The current price is less than $3,400.

Bad weather that destroys crops could push the cocoa price up again, but it is unlikely that it will return to its level of 2024 – which should come as a relief to chocolate companies.

DELAYED GRATIFICATION

A bite of your favourite bar should bring a smile to your face. The benefits from chocolate company shares may take longer to materialise: the after-effects of the 2024 cocoa price spike linger. But a spirit of change is pervading the whole food sector which could produce longer-term rewards.

Mondelez, the US titan that brings us Cadbury’s and Toblerone, is regarded as the top pick in the sector. The $74billion business should be able to take advantage of lower cocoa prices.

Brokers Jefferies are targeting a share price rise from the current $58 to $69.

The Nestle confectionery stable includes not only Kit Kat but Aero and After Eight, too.

Philipp Navratil, the Swiss company’s chief executive since September 2025, has sold the ice cream division – a path also taken by Unilever. But Navratil appears convinced there is no substitute for chocolate: he eats a Kit Kat with one of the eight cups of coffee he enjoys every day.

Nestle is a long-term holding at the Fidelity European fund and Fidelity European trust (in which I am an investor).

Marcel Stotzel, manager of the fund and the trust, cites Nestle’s leading position in confectionery and coffee and its geographic spreads in developing and emerging markets.

He said: ‘The company isn’t overly reliant on one single product or market to drive profits, which has allowed it to grow its dividend consecutively over 25 years. In our view, this is the hallmark of a resilient business.’

These solid attributes explain why Nestle, the world’s largest food business, is seen as a ‘buy’ by nine of the analysts that follow the stock.

The remaining 12 view it as a ‘hold’, adopting a wait-and-see approach on Navratil’s campaign to revitalise the company which is based in Vevey.

Barry Callebaut, which is based in Zurich, also has a recently appointed chief executive – Hein Schumacher, formerly of Unilever.

His arrival in January has boosted shares, but they remain 35 per cent down over five years. Morgan Stanley is particularly optimistic about the stock’s prospects, targeting an increase to 1,600 Swiss francs.

Pennsylvania-based Hershey is most famous for its Reese’s Peanut Butter Cups, but it also supplies 80 other types of snacks. Most analysts regard the shares as a ‘hold’, while they observe the outcome from Hershey’s move into protein-based snacks. But they are still targeting a rise from $206 to $228.

Analysts are more cautious about the prospects for Lindt & Sprungli. Founded in 1845, it may be more affected than its peers by the impact of Middle East tensions. Fewer tourists visiting the region means less demand for its Lindor truffles and other products. But if you are patient, Lindt’s focus on these premium ranges and innovation could pay off.

ETHICAL ALTERNATIVES

Some people don’t like chocolate. Others seek to avoid investing in the sector because of the difficult conditions facing small-scale cocoa farmers in the Ivory Coast, Ghana and other nations.

If you want to diversify into more sustainable agriculture, food production and supply chains this Easter, Jason Hollands of Evelyn Partners suggests such funds as Franklin Future of Food, Rize Sustainable Future of Food and Pictet Nutrition.

A feeling of virtue could balance out the guilt you feel from your chocolate splurge.