Economics start to bite for chocolate lovers

Cadbury Confectionery is reducing the size of its family block as the chocolate maker battles higher manufacturing costs.

But while the block would be reduced by 10% to avoid a price rise, the company's owner said its Dunedin factory was going from strength to strength.

''We didn't take this decision lightly,'' said Jack Evison, the New Zealand head of Mondelez, the company that owns Cadbury.

''More of our manufacturing costs are going up than down. Other chocolate companies are also under pressure. Two are in significant trouble in Australia.

''We chose to reduce the size of the block rather than up the price so we can keep chocolate as an affordable treat. The quality and taste will remain the same.''

Ms Evison would not confirm when the smaller blocks would hit shops in New Zealand other than to say between two and five months. Neither would she confirm what costs were increasing.

Media reports late last year showed the price of cocoa beans reaching three-year highs following higher consumption of chocolate in Asia and the Ebola virus in Africa making harvesting of the beans impossible.

Ms Evison said Mondelez was still investing in Dunedin. Last year, the company spent $6 million in the city, allowing more ''special products'' to be produced in New Zealand.

''The site is going great guns and the site has become a site of manufacturing excellence.''

Cadbury World tours were exceeding expectations with 100,000 people going through in the past year.

The cafe had been rated highly in trade magazines.

And Cadbury was putting a lot of effort into ensuring the chocolate carnival was more exciting than previous years, she said.

Asked about the push-back from customers over the reduction in block size, Ms Evison said Cadbury had learnt a lot from 2009 when customers rebelled against the changed ingredients in dairy milk bars.

The company had decided to announce the block size changes in advance to ''have a conversation'' with the public before the changes were implemented.

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