Cocoa prices fell precipitously in 2025 after rising for almost two years. Chocolate, meanwhile, has seen price increases due to increased demand ahead of the joyous holiday season.
AFP looks at the current situation of the cocoa market as well as the causes of the discrepancy.
The two countries that supply the most pods—the fruit of the cocoa tree—from which cocoa beans are extracted to manufacture chocolate are Ghana and Ivory Coast.
Over half of the world’s production comes from these two West African nations, with the majority coming from Brazil, Cameroon, Ecuador, Indonesia, and Nigeria.
The cocoa market is extremely susceptible to weather patterns and tree diseases in West Africa due to the spatial concentration of farms.
Meanwhile, a considerable number of independent smallholders are engaged in cultivation.
Between 2021 and 2024, cocoa crops fell short of demand, driving up prices.
Rabobank analyst Oran van Dort told AFP, “That was the result of … supply side issues like ageing trees, the spread of swollen shoot virus (and) the spread of black pot disease” in Ghana and Ivory Coast.
He also mentioned the minimal use of pesticides and fertilizers due to farmers’ poor wages.
After hovering at $1,000 to $4,000 per tonne throughout the 1980s, cocoa prices in New York trade reached $12,000 in December 2024.
In Ghana and Ivory Coast, cocoa prices — which rose significantly this year after having remained unchanged for a long time — are set by the countries’ respective governments.
“For the first time in years, I feel like we are farming with the government behind us, not on our own,” Ghanaian producer Kwame Adu, 52, told AFP.
Higher income has allowed producers to buy fertiliser and machinery, improving their harvests — and to plant new trees.
“Last year went well because as the cocoa was to bear fruit the rains came,” Jean Kouassi, a 50-year-old Ivorian farmer, told AFP.
He owns plantations measuring four hectares, the size of nearly six football pitches.
“Record-high raw material costs (have) forced chocolate manufacturers into a series of unpopular choices: shrinkflation, price increases and the quiet dilution of cocoa content,” noted Saxo Bank analyst Ole Hansen.
UK snack brand McVitie’s recently disclosed that Penguin and Club bars are no longer classed as chocolate having reduced their cocoa content because of elevated prices.
They are instead each described as “chocolate flavour”.
It is a major reversal especially for Club, whose advertising campaigns carried the slogan: “If you like a lot of chocolate on your biscuit, join our club.”
Chocolate giants Ferrero, Mars, Mondelez and Nestle have meanwhile seen demand weaken, having raised the prices of their treats.
However, cocoa prices have retreated strongly compared to one year ago, with New York prices at around $6,000 per tonne.
“The current slump arrives far too late to affect Christmas assortments already produced and priced months ago,” said Hansen.
Nestle told AFP that “it is still too early to comment on specific changes regarding prices” in the wake of cocoa’s drop.
“Recent shifts in cocoa prices are encouraging, but the market remains volatile,” it added.
There is hope, however, for Easter eggs and chocolate bunnies set to hit shop shelves soon after Christmas, said Hansen — but only if the market stabilises around current levels, he added.
