Chocolate Lovers Beware: Cocoa Prices Hit 46-Year High
PARIS - If you have a sweet tooth, you might want to brace yourself for some bitter news. The price of cocoa, the main ingredient in chocolate, has soared to its highest level in 46, according to Reuters.
The reason for the spike is a combination of bad weather and supply shortages in West Africa, where most of the world's cocoa is grown. Ivory Coast and Ghana account for about 60% of global cocoa production, but they have been hit by heavy rains that have flooded some fields and disrupted the drying process of the beans.
The International Cocoa Organization (ICCO), has estimated that the world will face a cocoa deficit of 142,000 metric tons this season, meaning that demand will exceed supply. This is the second consecutive season with a supply shortfall, and the stocks-to-use ratio, a measure of how much cocoa is available in the market, is expected to drop to its lowest since 1984/85.
This means that chocolate makers will have to pay more for their raw materials, and may pass on some of the costs to consumers. Some analysts have warned that chocolate prices could rise by up to 10% in the coming months.
However, not all is doom and gloom for chocoholics. There are some factors that could ease the pressure on cocoa prices in the future. For one thing, the main cocoa harvest in West Africa starts in October and could bring some relief if the weather improves and yields are better than expected. For another, the demand for chocolate has been affected by the COVID-19 pandemic, which has reduced social gatherings and impulse purchases. Some consumers may also switch to cheaper alternatives or reduce their consumption if chocolate becomes too expensive.
Therefore, it remains to be seen how long the cocoa rally will last, and how much it will impact the chocolate industry and its customers. For now, you might want to savor every bite of your favorite treat while you can.