The global chocolate industry is currently experiencing a significant crisis, with the demand for chocolate far surpassing the available supply of cocoa. This imbalance has led to a dramatic increase in cocoa prices, which recently hit a record high of $8,018 per metric ton—a 25% rise in just one week and a 215% increase from the previous year. As a result, major African cocoa processors have been forced to cut production due to the soaring costs of raw cocoa beans.
The root of this price surge can be traced to the geographical limitations of cocoa cultivation, as the trees thrive only near the equator. Consequently, four West African nations—Ivory Coast, Ghana, Cameroon, and Nigeria—produce about 75% of the world’s cocoa. However, these regions have faced challenges such as adverse weather conditions, bean diseases, and longstanding underinvestment in agriculture, leading to poor harvests and a widening gap between supply and demand.
The International Cocoa Organization reports a significant shortfall in cocoa supply, with a deficit of 374,000 tons predicted for this season. Meanwhile, global demand for chocolate has been on the rise, doubling over the past three decades as chocolate has become more accessible to consumers worldwide.
The impact of these trends is already visible in the market. In the United States, chocolate product prices increased by 11.6% in 2023 compared to the previous year. Major confectionery companies like Hershey and Mondelez, the maker of Cadbury, have indicated that they will need to adjust their prices to cope with the escalating costs of cocoa, signaling more expensive chocolate products for consumers in the future.