Last year, cocoa prices skyrocketed almost 300%, making chocolate bars, Easter eggs and cocoa powder much more expensive than this year.
In the US, retail chocolate prices were one-fifth this Valentine’s Day compared to last year, according to Wells Fargo Bank. The price of King-sized US Reese Hearts Chocolate Bar was 13% higher in February 2024 than the same month last year.
Meanwhile, in the UK, prices rose between 5 and 6 pounds ($6.63 to $7.96) at Tesco supermarkets up until Easter (year-on-year), reducing the size to 316g (11 ounces) (11 ounces) (9 ounces). Overall, unit prices rose by a whopping 47%.
The price of cocoa, a key ingredient in chocolate made from roasted raw cocoa beans, has retreated by about 20% since its all-time high in December 2024, but consumers are still paying for a record price for chocolate.
Cocoa prices surges can choke several factors. The main one is the extreme weather that hit cocoa growers in West Africa. From there, most of the world imports cocoa.
According to Amber Sawyer, an analyst at The Environmental Thank Energy and Climate Intelligence Unit (ECIU), expensive chocolate is no surprise.
“Chocolate is just one of many foods that are becoming more expensive due to extreme climate-driven weather,” she said. “These extremes will continue to get worse.”
And maybe the price too.
What happened to the price of cocoa?
The benchmark for New York futures contracts used to exchange cocoa with a specific future date and price reached a high of $12,565 per metric tonne in December 2024.
Last year’s small cocoa harvest led to a record shortage of supply as two-thirds of the world’s cocoa beans are a destructive crop of bad weather and disease on Ghana and ivory coasts, where two-thirds of the world’s cocoa beans are grown.
Crop shortages have also been observed in Nigeria and Indonesia, the third largest cocoa producer.
Overall, in 2024, there was a 500,000 tonnes of cocoa deficit in the global market, continuing to keep prices high.
The latest cocoa harvest, which took place between October 2024 and March 2025, has got off to a bright start as 33% more beans arrived at the Ivory Coast port compared to last year, Commerzbank analyst Carsten Fritsch said in a note to clients.
But while New York’s cocoa futures prices are currently hovering at around $8,350 per tonne, a massive drop since December, there is growing concern that the same dry weather that last year’s crops were broken will equally devastating this year.
Uncertainty is taking a blow to chocolate producers. Swiss chocolate maker Barry Carrebaud cut its annual sales forecast significantly on April 11, bringing its stock down nearly 20% thanks to what is called the “unprecedented volatility” of cocoa prices.
What is the price increase?
weather
Volatile weather is one major factor. West Africa experienced extreme rainfall in 2023, with some locations total rainfall exceeding twice the average of 30 years, and 2024 saw extreme heat and drought.
Many climate scientists refer to the El Nino meteorological phenomenon, which produces warmer than average sea surface temperatures in the central and eastern tropical Pacific Oceans, as the main driver of volatile weather patterns. However, they also expect a transition to the La Nina pattern – cooling of sea surface temperatures in the central and equatorial Pacific Oceans every three to five years – is harvested at least temporarily.
In fact, the international cocoa organization in February predicted a global cocoa surplus of 142,000 megatonnes from 2024 to 25, marking its first surplus in four years. This partially explains the recent decline in prices.
However, Switzerland-based commodity trader Felipe Paulman Gonzaga said “it’s only exacerbating climate change concerns” and “it’s only exacerbating climate concerns.”
Scientists at Climate Central, a research group, published a paper this year showing that climate change has compromised cacao trees during harvest seasons in Ivory Coast and Ghana.
Laws for deforestation
In addition to changing weather patterns, several other issues have also driven the recent price rise for cocoa.
Throughout West Africa, new deforestation laws prevent farmers from expanding cocoa plantations and covering supply.
West Africa is also working on stocking aged trees. “The old trees have not been replaced,” Paulman Gonzaga told Al Jazeera. “The industry has had a lack of investment.”
disease
At the same time, the spread of cocoa swollen shoot virus (CSSV) hit the harvest. Market research group Tropical Research Services recently discovered that the expansion of CSSV could potentially cut cocoa production in Ivory Coast.
Illegal gold mining
Meanwhile, Ghanaian cocoa farmers have abandoned beans for gold in the illegal mining boom that has reached Ghana’s cocoa production and helped raise prices.
In recent months, investors have bought valuable metals to protect themselves from the turmoil of financial markets unlocked by US President Donald Trump’s trade tariffs. On April 16th, gold reached $3,357 per ounce for the first time.
As a result, many farmers sell their shares to illegal miners who have destroyed the strip of gold-pursuing land. Ghana is the leading producer of African gold and is the sixth largest in the world.
Will cocoa prices continue to rise?
“Dutys affect the value of the product, and cocoa is no exception,” says Paulman Gonzaga. “In the beginning you’d think that trade collection will reduce the demand for cocoa in the US. This is a big consumer.” The US consumes the most chocolate in the world, but Swiss take that tag for the most per capita consumption.
“But if US consumption continues, it could raise prices, and of course Trump may lower tariffs. [on West African cocoa exporters] In the future, it will likely lead to higher demand. ”
Pohlmann Gonzaga cited the growing demand for chocolate in East Asia. “We may be seeing similar trends as coffee,” he said. For example, coffee consumption in China increased by more than 60% between 2019 and 2024.
In close conditions, Paulman Gonzaga said prices are “highly likely to be a horizontal trend… volatility will be the word of order this year, as these factors can cancel each other.”
How did the chocolate maker respond?
So far, producers have responded in one of two ways. They either hand the consumers high costs, have less cocoa, or use alternative ingredients to promote their products.
Last year, Food Giant Nestle introduced a hazelnut flavour to a British airline with a chocolate bar that weighs about a third of the weight of its competing chocolate bars at 36g (1.3oz).
In 2024, Agri-Food Giant Cargill partnered with Voyage Foods, a chocolate alternative producer who creates Cocoa-free bars from grapeseed, sunflower flour and other flavorings, and creates cocoa-free bars and become a business-to-business distributor.
In addition to large companies, startups like Nucoco and Planet A are exploring microbial fermentation techniques to enhance and mimic chocolate aromas and flavors.
Elsewhere, Dubai Chocolate was founded in 2022. Its products are filled with pistachios and tahini and are inspired by Kunafa, a staple of the Middle East and North Africa, a saccharine dessert. Since it was on the market, it has become a social media sensation.
If cocoa prices continue to rise, “we expect to see more and more cocoa alternatives on supermarket shelves. The interesting question is whether consumer preferences will change,” Paulman Gonzaga said.
Source link
