Brazil’s Cocoa Industry Faces Early 2024 Significant Challenges

In the first three months of 2024, Brazil’s cocoa industry encountered significant setbacks, noting a 31% decrease in cocoa bean receipts.

This information comes from data gathered by SindiDados – Campos Consultores and publicized by the National Association of Cocoa Processing Industries (AIPC).

The total dropped from 27.2 thousand tons in early 2023 to just 18.7 thousand tons.

Experts link the sharp decline to the negative impacts of El Niño and diseases like witch’s broom and brown rot, which heavily disrupted normal harvesting and supply chains.

Bahia, usually a cocoa production leader, experienced an 18% drop in output, decreasing from 13.9 thousand tons to 11.4 thousand tons.

Pará saw its production nearly halve to 5.8 thousand tons from 11.6 thousand tons.

Espírito Santo and Rondônia sustained their contributions, each accounting for about 7% of the total volume, consistent with last year.

The decrease in raw cocoa availability directly affected the processing sector, causing a 6% reduction in cocoa bean grinding.

This year, processors handled only 59.9 thousand tons in the first quarter, down from 64 thousand tons in the same period of 2023.

Brazil’s Cocoa Industry Faces Early 2024 Significant Challenges

On the international front, the cocoa market compounded Brazil’s challenges.

Despite soaring global cocoa prices, with futures in New York up 130.4% and London up 140.3%, Brazil could not capitalize due to reduced output.

Global supply issues, worsened by poor weather in West Africa, another key cocoa region, intensified these challenges.

Analysts now foresee a third straight global cocoa deficit, an occurrence not seen in over fifty years, driving the stock-to-demand ratio to unprecedented lows.

These events represent a pivotal moment for Brazil’s cocoa industry, which is struggling with production issues and global market volatility.

Brazil now confronts the twin tasks of boosting its production capacity and adjusting to global market shifts amid ongoing climatic and economic changes.