Global cocoa prices have reached new record highs, and the reason for this is the drought that has damaged crops in West Africa.
Namely, the price of cocoa on the New York market was 5,874 dollars per ton yesterday. So the price of this key ingredient for making chocolate has almost doubled since last year. The main producers of chocolate, as well as the end consumers, are already feeling this.
One of the world’s largest chocolate producers, American Hershey, announced yesterday that it expects historically high cocoa prices to limit earnings growth this year. Hershey CEO Michele Buck does not rule out the possibility of rising chocolate prices for end customers.
The mentioned company made the announcement after announcing its financial results in the last quarter of 2023. According to these results, their sales decreased by 6.6 percent, as consumers affected by inflation reduced their spending on confectionery products.
Another American manufacturer, Mondelez, pointed to rising prices of ingredients for making chocolate as one of the challenges this year. Mondelez Chief Financial Officer Luca Zaramella stated that they are facing a significant rise in cocoa and sugar prices.
Cocoa prices have risen due to a poor harvest in West Africa, where production meets most of the global demand for cocoa.
The meteorological phenomenon El Nino causes droughts in Ghana and the Ivory Coast, two of the world’s largest producers of cocoa. Higher temperatures and changes in precipitation patterns are a consequence of climate change, and they also affect harvests, the BBC reports.