Remember when chocolate was a casual indulgence? A plentiful treat at Christmas, Easter, Valentine’s and Mother’s Day? I remember, when I was a kid, I could shuffle off down the street to the corner store and get a candy bar for a dime…
Remember when chocolate was considered a casual indulgence?
Now, though, you almost have to max your credit card or take out a second mortgage to afford even a small dose of precious chocolate.
In fact, chocolate prices have already increased 14 percent this year, over last.
Chocolate first started to increase in price because of a devastating plant disease that was threatening the once-dominant cocoa plantations of Central America. Soon after – about 10 years ago – the cocoa industry and choclatiers got on the fair trade and sustainability bandwagons, sending chocolate on a second round of major price increases. Now a complex interaction between climate, the global economy, demand, and supply issues is threatening to push chocolate prices even higher.
It seems that this is an El Niño year, meaning that lower than average rainfall and strong Harmattan winds will prevail in West Africa, where cocoa is a major crop. Together, just two West African countries – Côte d’Ivoire and Ghana – account for more than 60 percent of the world’s cocoa production. Industry experts agree, the cocoa crop will probably be small. There may even be shortages, compared to ‘normal’ years..
Standard & Poor’s Global Commodity Insights’ Principal Research Analyst Sergey Chetvertakov says cocoa prices are on the rise as we speak. And the unfavourable weather hasn’t even set in, yet. Cocoa was trading last month at $3,160 per metric ton, the highest it’s been since May 5, 2016. It’s now trading above $3,250 and still climbing. Chetvertakov predicts the weather alone could push prices up to $3,600 per metric ton by the end of the year.
Not only cocoa…
It takes more than just cocoa to make chocolate. And the formulae that have made a select few makers rich, and famous in the chocolate universe are closely guarded secrets.
You also need cocoa butter, cocoa liquor, and milk (for milk chocolate). Principal among those ingredients, cocoa butter as has already increased 20.5 percent in price this year.
A supply-demand conundrum
In spite of chocolate’s ever-rising price, market analyst Andrew Moriarty notes that cocoa consumption in Europe is, “near record highs.” I have to wonder how that works. European countries are experiencing punishing food price increases and some – including France and Hungary – have just started taking drastic measures to meet the drastic threat.
So how can Europeans afford all that chocolate when they say they can’t afford to feed their families decent food? Could be that Europeans are drowning their protein, fruit and veggie sorrows in soothing, comforting chocolate. But that doesn’t really make sense. Perhaps France, a noted consumer of chocolate, should look into that strange phenomenon, and act the way it has in response to soaring food prices in general…
Anyway… Moriarty says the only way chocolate prices will ease off is if demand eases off. We’ll see.
~ Maggie J.