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18 July, 2024
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Chocolate prices to surge

Decreased cocoa production leads to price hikes and potential future shortages


Chocolate enthusiasts should brace themselves for price hikes in the near future, as cocoa prices continue to soar. Recent data from the NielsenIQ consumer information database reveals a 14% increase in chocolate prices over the past year, and this upward trend is expected to persist due to mounting pressures on cocoa production. Sergei Chepkerakov, an analyst at S&P Global Commodity Insights, explained the situation, stating, "The cocoa market has experienced a significant price surge. This is the second consecutive season of a market deficit, with cocoa stocks projected to reach unusually low levels," as reported by CNBC.

Côte d'Ivoire and Ghana, responsible for over 60% of global cocoa production, may face adverse effects.

On Friday, cocoa prices reached $3,160 per metric ton, the highest level since May 5, 2016, and remained around $3,171 per metric ton yesterday. The looming El Niño weather phenomenon is anticipated to bring reduced rainfall and strong winds to West Africa, the primary region for cocoa cultivation. Côte d'Ivoire and Ghana, responsible for over 60% of global cocoa production, may face adverse effects.

Chepkerakov predicts another deficit in the upcoming cocoa season, spanning from October to September next year. Consequently, cocoa futures could surge even higher, potentially reaching $3,600 per metric ton. CNBC quoted the analyst cautioning consumers to be prepared for the possibility of elevated chocolate prices. Chocolate manufacturers are compelled to pass on the increased production costs to consumers, a burden compounded by rising raw material expenses, escalating energy prices, and higher interest rates.

In addition to cocoa, another critical component of chocolate production, cocoa butter, has witnessed a 20.5% price surge since the beginning of the year. Sugar, yet another vital ingredient in chocolate, has also experienced a rise, with prices reaching an 11-year high in April.

[This article was translated from its Greek original]

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