The latest price increase was due to reports from West Africa that major cocoa factories in Côte d’Ivoire and Ghana have halted or reduced processing because they could not buy beans, industry sources told the media.
According to Bloomberg, cocoa is worth more than copper in the commodity market and as Easter approaches, chocolatiers have already raised their costs for consumers, after 3 years of poor cocoa harvests in West Africa, and a fourth is expected.
The hunt for beans is partly due to news from Ghana, the world’s second-largest manufacturer after Côte d’Ivoire, that it is about to squander a key funding mechanism as COCOBOD, the industry’s regulator, relies on foreign investment. to pay the cocoa farmers for their beans.
According to Bloomberg, “cocoa’s advance will translate into a rise in chocolate prices during the year. “
As ConfectioneryNews reported, Easter eggs are more expensive due to last year’s price increase. Bloomberg said some brands are reducing the length of the bars or selling types with other ingredients to soften the blow.
“Chocolate could be even more expensive by Easter 2025 if cocoa illnesses and bad weather prolong the deficit amid high sugar prices,” Diana Gomes, an analyst at Bloomberg Intelligence, said in a weekend note.
It is now in the next half of the harvest in West Africa (April to September), the smaller of the two annual harvests.
“This drastic build-up is the result of a drop in supply, brought on by crop losses due to disease, climate changes and, most likely, increased production and livelihood prices for farmers due to crippling inflation.
“It remains to be seen whether the source will recover or whether the existing trend will last longer. The new regulations being implemented and debated in Europe, which add deforestation and corporate due diligence, are much needed, but they will also increase prices. for manufacturers and companies in unknown ways.
If major West African countries fail to live up to their contracts of origin, the consequences will affect cocoa processors around the world. Asian company Guan Chong Bhd, one of the world’s largest cocoa processors, is already looking to source cocoa from Ecuador, Peru and Indonesia and is paying premiums for its beans.
“We want a big call for destruction to reach the destruction of the sources,” Steve Wateridge of Tropical Research Services, a global cocoa expert, told Reuters.
Challenging economic situations are exacerbating farmers’ difficulties in earning sufficient income, Michael E Odijie said in an article in The Conversation Africa. He pointed out that environmental factors such as El Niño, economic cycles and human activities such as illegal mining are contributing to the decline in cocoa production in the region.
Walker said: “The fair industry has long argued that the boom-and-bust cycle of costs is unsustainable for smallholder farmers, who want greater stability in their livelihoods to invest in their farms and adapt to climate change. Higher costs are offset by lower productivity, which perpetuates the source of income distrust that contributes to keeping farmers trapped in poverty and threatens cocoa’s long-term.