That bag of Halloween chocolates is setting consumers back a lot more than last year with chocolate prices doubling since the beginning of the year, according to a report from the Wells Fargo Agri-Food Institute.
Americans eat 2.8 billion pounds of chocolate annually, an average 10-12 pounds per person – about half of what the average Swiss eats.
Americans spend $23.2 billion per year on chocolate, making the U.S. the second largest chocolate market in the world behind China.
Cocoa production for 2024 is projected to be low for the third straight year, the result of shifting weather patterns across much of Africa’s growing areas. The 2022-23 crop was the victim of above average rainfall that produced increased disease while the 2023-24 crop suffered under hot harsh winds that produced dust, blocking out light and damaging pod production.
Though the cacao tree originated in Central and South America, some 60% of the global supply is grown in the Ivory Coast and Ghana, with Ecuador the third largest producer, contributing 9%. Ivory Coast production is estimated to be off by 22.4% this year while production in Ghana is expected to be down 31.2%. There are fears the area will be too hot by 2050 to sustain a crop.
Global cocoa production is expected to be off by 14.2% from last year to 4.33 metric tons, the International Cocoa Organization said, bringing the global cocoa deficit to 462,000 metric tons.
Cocoa prices hit a record $5,874 per metric ton on the New York commodities market in March and, as of Oct. 8, were at $6,955. Over the last year, prices have ranged as high as $11,722.
“It is likely consumers will see another price spike on chocolate candy this Halloween with the current crop conditions and rising manufacturing costs,” the Wells Fargo report said, adding that there’s no relief in sight.
“Looking to 2025 with cocoa harvests coming up short for the third year in a row, it is likely that cocoa prices will remain high at least through the next crop year ending September 2025.”
Retail chocolate prices were up 10% in 2023 – about three times the overall inflation rate.
The report advised skipping brand names and going with generic alternatives, which can provide as much as 40% in savings, to keep prices in check.
Michele Buck, the president and CEO of the Hershey Co., said cocoa prices likely would have a negative impact on its earnings on a call earlier this year.
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