Cocoa prices have doubled in 3 months

The price per ton of May-delivery cocoa traded on the New York Mercantile Exchange has exceeded 9,600 dollars, reaching an all-time high.

According to data analytics and consulting firm GlobalData, while an approximately 8 percent decline in cocoa supply is projected for the 2023-2024 season compared to the previous 12 months, the primary cause of the losses is attributed to problems in Ivory Coast and Ghana, the two largest suppliers.

SEED COSTS

Cocoa prices have continued to break records as major cocoa factories in Ivory Coast and Ghana have decided to reduce or halt production because they cannot cover seed costs. A significantly lower cocoa harvest is expected in Ivory Coast, the most important producer country.

Ivory Coast accounts for approximately 45 percent of the world's cocoa supply. However, harvests in other cocoa-producing countries such as Nigeria and Ghana are also falling well below expectations.

Due to heat and drought affecting the development of cocoa beans, the mid-crop harvest, which will begin in April, is also estimated to be lower than last year.

While limited supply and rapidly rising prices are causing uncertainties in the cocoa market, cocoa bean prices saw all-time highs yesterday in the New York and London cocoa futures markets. In the last 3 months, it has increased by more than 150 percent in New York. Since March 2023, prices have shown an increase of 255 percent.

SURPASSED COPPER

Having become the commodity with the highest increase after uranium by rising more than 61 percent last year, it is noteworthy that the price of cocoa per ton has surpassed copper, which is at the 9,000 dollar level, this year.

INCREASE IN CHOCOLATE PRICES EXPECTED

Following the news from the two countries that provide 60 percent of the world's cocoa production, chocolate prices are expected to rise sharply all over the world.

The rally in rising cocoa prices points to a difficult period for consumers. Chocolate manufacturers are passing on high cocoa prices to consumers either through price increases or by reducing packaging sizes.

The decrease in cocoa harvest due to climate conditions had pushed chocolate manufacturers to increase prices. With the production disruption continuing, it is estimated that chocolate prices could rise even more sharply.