Cocoa is a popular ingredient used by CPG brands that may be impacted due to the looming U.S. tariffs. While much is up in the air about what this means in the long-term, many U.S. companies could face supply chain concerns that will inevitably change the way they make their products. As these ingredients become more costly and less accessible, the need for innovative, sustainable alternatives has never been greater.

NotCo, the food tech, AI-driven platform, is now making it possible for businesses to take these challenges head on by using its proprietary AI technology, Giuseppe. With tools like NotCo’s Concept Generator, which changes ideas into market-ready products, NotCo is aiming to address R&D challenges for food and beverage companies, which could benefit those facing potential manufacturing issues due to tariffs.

We recently spoke to Matias Muchnick, co-founder and CEO, NotCo, to learn more.

Liz Parker Kuhn: What challenges are currently impacting the cocoa industry, and what role do tariffs play?

Matias Muchnick: The cocoa industry is facing one of the most volatile periods in its history. A combination of adverse weather, climate change, soil degradation, and widespread crop diseases like Swollen Shoot Virus and Black Pod Disease has led to an estimated 15% crop deficit for the 2023/2024 season. As a result, cocoa prices soared to record highs in late 2024 and remain nearly triple what they were just a year earlier.

At the same time, new U.S. tariffs on South American and African imports could significantly raise costs for cocoa-based products, a staple used across the CPG industry, tightening margins even more for manufacturers already navigating commodity price volatility. This uncertainty is forcing brands to rethink their reliance on traditional cocoa, to not only manage immediate costs but to safeguard their long-term supply chains against ongoing disruption and environmental risk. While the long-term implications remain uncertain, many American food and beverage companies are bracing for higher costs and potential supply disruptions. It’s a wake-up call: the way products are made, sourced, and scaled may have to fundamentally change.

LPK: How does cocoa-free chocolate help companies navigate supply chain risks tied to cocoa shortages and tariffs?

MM: As a food tech company at the forefront of AI-driven innovation, NotCo is redefining how global brands approach product development. Powered by our proprietary AI platform, Giuseppe, we are developing product innovation, formulations, and flavors for both global partners and our own brands. With over 100 products launched and 24 issued patents, we combine cutting-edge technology with deep food science expertise, enabling brands to innovate faster while tackling the key challenges facing the industry.

Cocoa-free chocolate offers a transformative solution. By reducing dependence on a resource-intensive and volatile commodity, it stabilizes supply chains, mitigates tariff exposure, and lowers environmental impact, without sacrificing indulgence or quality.

For instance, NotCo’s cocoa-free chocolate was designed exactly for this moment. Using our proprietary AI platform, Giuseppe, along with advanced fermentation, we recreated the rich taste and smooth melt of traditional chocolate without a single cocoa bean. Instead, it’s made from sustainable, upcycled ingredients like fermented cereals and seeds, giving manufacturers a cost-effective, ethical alternative that isn’t exposed to cocoa market volatility or tariff hikes.

This helps brands:

• Stay insulated from volatile cocoa markets and tariff-induced pricing pressure
• Ensure long-term stability amid declining cocoa crop yields and environmental stresses
• Reduce environmental impact by avoiding issues like deforestation, water overuse, and labor exploitation
• Beyond chocolate bars, this cocoa-free base can transform ingredient sourcing in the confectionery industry and beyond, offering scalable solutions across a variety of products like spreads, baking chips, hot chocolate, and coatings, helping companies future-proof their products in a market where cocoa’s stability is no longer guaranteed

LPK: How does AI-driven innovation, like NotCo’s Giuseppe platform, offer cost stability amid global supply chain disruptions?

MM: As climate change, resource scarcity, and trade instability reshape the global food system, AI is becoming a critical tool for companies seeking stability. Rather than reacting to disruption, AI empowers food and beverage brands to get ahead of it to make faster, smarter decisions on ingredients, formulations, and product development.

Giuseppe plays a key role here. It doesn’t just mimic products, it reimagines them. Giuseppe processes thousands of variables such as cost, flavor, availability, sustainability, sourcing constraints, and regulatory limits to develop scalable, real-world solutions. In the case of cocoa-free chocolate, it combines upcycled ingredients, sustainable crops, and precision fermentation to deliver a rich, indulgent experience—without using a single cocoa bean, 40% less sugar, and delivering 50% flavor equivalence.

This innovation process includes:

• A range of microbial and enzymatic processes to enhance flavor complexity and texture
• The exploration and integration of local and endemic cereals that contribute functional value to the final formulation
• A formulation strategy focused on clean-label, minimizing allergens components to ensure broader accessibility and compliance.

The result is a premium chocolate experience that delivers on consumer expectations while avoiding the cost instability and environmental risks tied to traditional cocoa. By combining culinary expertise with real-time AI intelligence, we’re offering a powerful way for manufacturers to respond to today’s challenges with agility and precision

LPK: How is a product like Cocoa-Free Chocolate formulated—and can the innovation model be replicated across other categories?

MM: Cocoa-free chocolate is just the beginning. With demand for sustainable, resilient ingredients quickly rising, the opportunity to replicate this model across categories is massive.

Using our Giuseppe AI, we identify whitespace opportunities by analyzing live data from social listening, reviews, and competitive trends. After identifying the product opportunity, the platform formulates the new product from a database of thousands of ingredients, optimized for taste, cost, sourcing, and compliance. This streamlined process transforms bold ideas into market-ready products faster and more precisely than traditional R&D.  

That same approach has already powered other breakthroughs, such as the Cocoa-Free Brownie, a fluffy, moist, plant-based dessert that delivers the same indulgence as the real thing, without using cocoa or eggs—a solution to the avian influenza.

For CPG brands navigating rising tariffs, manufacturing challenges, and climate uncertainty, AI tools such as NotCo’s technology offers CPG brands a way to rethink how products are built from the ground up.

Related: How to solve the cocoa challenge