Chocolate lovers around the world may have to brace themselves for a sweet treat shortage as cocoa prices reach unprecedented heights, with economists projecting no downward trend through 2024.
Cocoa prices have more than doubled since the beginning of last year, reaching an all-time high of $9,010.59 per ton on the New York commodities market in the second week of February.
Unfavourable weather conditions, smuggling, and swollen shoot disease are said to have contributed to the price increase, resulting in lower crop yields in Côte d'Ivoire, which produces nearly 40% of the world's cocoa bean, and Ghana, which produces 20%.
Strong seasonal winds and a lack of rainfall have also contributed to the shortage, forcing traders to scramble for supplies and driving prices up.
Upsetting situation
Chocolate manufacturers, as a result of rising primary ingredient costs, are bracing for a potential demand slowdown.
In a report by ingredients supplier Henley Bridge, cocoa price increases of 15-20% for the first half of 2024 are expected to continue for the remainder of the year.
This surge in pricing has already had a ripple effect on the industry, with chocolate makers adjusting their operations to stay afloat.
"It's upsetting considering we haven't witnessed such a significant decrease in cocoa output in recent years," Samuel Adimado, president of the Ghana cocoa buyers group, told Anadolu news agency, expressing his concern over the decline in cocoa production.
"Not only have we observed a drop in production, but we've also had to scale back our operations, including layoffs and the termination of contracts for some staff members," he added.
Meeting demands
However, Javier Blas, a London-based energy and commodities expert and Bloomberg opinion columnist, believes "this is a necessary crisis."
"The world needs higher prices to encourage the re-planting of millions of old trees — and take better care of the current ones," he said in a recent post on X.
The implications of the cocoa scarcity go beyond the chocolate business.
Other products that use cocoa as an ingredient, such as cosmetics and pharmaceuticals, may see price increases or supply chain disruptions.
Emerging economies, particularly those with a high demand for chocolate, may experience difficulty supplying customer demands.
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