Some analysts believe that chocolate companies are shifting capacity from Europe and North America to Asia, and maintain that slowdown is only because inventories were still left over from the first quarter.
Grind stats are used to indicate demand for chocolate in the region.
The total Asian cocoa grind stood at 143,659 tons compared to 143,463 last year, a modest 0.1% increase, according to figures from the Cocoa Association of Asia.
The data comes soon after Europe reported a 16% drop in its cocoa grind for the period.
North American cocoa grind stats are due tomorrow.
Shifting capacity to Asia
Keith Flury, senior commodity analyst at Rabobank International, told ConfectioneryNews.com before the grind stats were released that he expected Asian grind stats to be lower, but the fall would be less pronounced than in Europe as manufacturers had been shifting capacity to Asia.
Big manufacturers are looking to capitalize on two rapidly growing markets: India and China.
One of the largest chocolate manufacturers, Kraft spin-off Mondelez International, has identified India as one of its three priority markets for its chocolate strategy that excludes any market in Europe and North America.
Mondelez has a 33% share of the $2.3 bn Indian chocolate market, according to figures from Euromonitor International.
Ferrero opened a 28,000 m2 factory in India late last year, while Hershey recently ended its Indian joint venture with domestic firm Godrej and set-up its own Indian subsidiary.
Chocolatiers set sights on China
China is another Asian market becoming central to the big five chocolate firms, which are increasingly honing in on the fast growing BRIC markets.
Mars commands a 17.5% share of the $12.7bn Chinese chocolate market, over double the share of its closest rival Nestlé.
Hershey announced in a webcast earlier this year that it would construct a manufacturing plant in Asia to drive international growth. It focused on the Chinese market during its webcast, but has yet to name the location of the Asia site.
Global cocoa outlook
Rabobank anticipates that the global demand will outstrip the cocoa supply in the 2011/12 cocoa season by 2,000 tons.
Demand for season after is expected to climb much higher while cocoa production is anticipated to remain flat, creating a larger supply demand/deficit of 133,000 tons.