Cocoa price reaches record high of more than 10,000 dollars per ton: ‘Unprecedented situation’

Are you already longing to enjoy chocolate eggs with Easter just around the corner? You may have to dig deeper into your pockets for that this year. The price of cocoa has risen sharply in recent months. On the futures market in New York, cocoa reached a record price on Tuesday: for the coming month of May, one ton of cocoa costs more than 10,000 dollars (about 9,250 euros).

Two months ago, cocoa was trading for less than $5,000 in New York. A year ago it was even about $3,000 per tonne. This means that the price of the raw material has doubled this year alone.

The cause of the price increase is due to a disappointing harvest. For example, production in Ivory Coast and Ghana, the two largest producers of cocoa, has fallen sharply. The West African countries have recently been hit by heavy rain and heat.

Because the price of cocoa was very low for decades, West African growers have hardly invested in their plantations, writes the business newspaper Financial Times. This makes older trees more vulnerable to plant diseases and extreme weather conditions.

For example, at the end of last year, a lot of cocoa trees were affected by a fungal disease, which was the result of heavy rainfall. Trees that became infected had to be cut down. But new trees couldn’t immediately fill the gap. For example, it takes three to five years before a young tree can bear cocoa beans. For this reason, other cocoa-growing countries, such as Brazil and Colombia, cannot immediately increase supply.

Not only the poorer harvest conditions, but also stricter environmental regulations in the European Union, for example, are pushing prices up further. In addition, farmers in Ivory Coast are increasingly abandoning cocoa production to grow more lucrative crops such as rubber.

Price shock

Analysts expect that the higher cocoa price will eventually be passed on to the supermarket. Although it is expected that the biggest price shock for consumers is still to come.

Choprabisco, the federation that represents Belgian chocolate producers, says that the price increase poses major challenges for the Belgian chocolate sector. “An unprecedented situation,” it sounds. According to Choprabisco, the companies are each dealing with the price increase in their own way.