The cocoa industry is facing a significant upheaval as a catastrophic harvest in West Africa, the leading cocoa-producing region, triggers a surge in chocolate prices worldwide.
West African powerhouses Ghana and Cote d’Ivoire, which collectively produce about 60% of the world’s cocoa, have reported a sharp decline in output attributed to a devastating heatwave. This decline in cocoa production has led to higher cocoa prices, subsequently driving up chocolate prices globally.
Experts warn that chocolate prices are expected to continue rising as cocoa inventories dwindle throughout the year. In response to dwindling supplies and soaring prices, consumers in the United States have already begun to feel the impact, with chocolate prices on store shelves increasing by more than 10%. Similarly, consumers in the UK have seen a significant price hike, with chocolate prices rising by 12.6%.
The price of cocoa has soared to a record $10,000 per ton, reflecting the severity of the crisis in West Africa. With cocoa production in the region continuing to suffer, cocoa prices are poised for further escalation in the coming months.
Beyond climate change, other factors exacerbate the cocoa crisis, including the rising cost of fertilizers, deforestation, and illegal mining practices that degrade land. These multifaceted challenges contribute to the ongoing decline in cocoa production and pose significant risks to the sustainability of the cocoa industry.
Major chocolate manufacturers are feeling the pressure of the cocoa crisis and are taking measures to address it. Hershey’s, a leading chocolate maker, has announced plans to increase prices in response to the crisis. Similarly, Mondelēz International, the owner of popular brands such as Oreo and Toblerone, implemented a 15% price increase in 2023 and intends to implement additional price hikes this year.
The cocoa crisis underscores the urgent need for concerted efforts to address the underlying issues facing the cocoa industry, including sustainable agricultural practices, environmental conservation, and equitable supply chain management. Without decisive action, the long-term viability of the cocoa industry and the livelihoods of millions of cocoa farmers remain at risk.
