Cocoa prices in London and New York have soared to historic highs, fueled by strong demand, supply issues, and bad weather in key production areas.
On October 17, 2023, London’s Intercontinental Exchange ICE listed the March cocoa contract at a record-breaking 3,155 pounds per ton, the highest since 1920.
Rising prices result from investor activity and sustained demand despite higher costs, and European cocoa processing data reveals a smaller-than-expected demand decline.
In April 2023, the cocoa market peaked at a six-year high, driven by bean availability worries and tough weather in West Africa.
The International Cocoa Organization noted marked price rises in both markets due to a global supply shortage from West Africa, particularly Côte d’Ivoire.
Ukraine’s war, causing fertilizer shortages, also hindered cocoa farmer productivity.
Heavy rainfall in Côte d’Ivoire also caused concerns about mid-crop season delays and raised the risk of black pod disease, exacerbating supply issues.
The 2022/23 cocoa season likely faces a supply deficit due to lower production in Côte d’Ivoire and mixed outputs in Ghana and Brazil.
Cocoa prices reflect broader market dynamics, influenced by environmental, economic, and geopolitical factors, highlighting the complexity of agricultural commodities.
The cocoa price surge significantly affects chocolate makers, cocoa farmers, and global supply chains, highlighting local and global market interconnectivity.
Cocoa price escalation affects chocolate manufacturers, cocoa farmers, and the global market, emphasizing the delicate balance between supply and demand.
This situation underscores the need for sustainable farming, diverse supply chains, and strategies to mitigate climate change’s effects on agriculture.
As cocoa prices continue to break records, the industry faces challenges in maintaining global cocoa market stability and growth.