Chocolate prices anticipated to remain high for the remainder of 2024, says key ingredient supplier

A new study from Henley Bridge ingredients has forecast that chocolate prices appear set to remain at a concerning peak for the whole of 2024, as stock market prices continued to rise beyond £5,000 a tonne, placing significant pressure on the global market, writes Neill Barston.

Industry observers have noted the alarming rises over the past year, rising from marked low during the pandemic, as key supply chain communities continue to be hit with a combination of major challenges including poor harvests, crop disease, adverse weather, the aftermath of the Covid-19 pandemic, as well as key forest areas being illegally used for gold mining.

With farmers in Ghana and Ivory Coast, which continues to make up two thirds of the trade, concerns have been expressed repeatedly over recent years from organisations including Fairtrade, that the viability of the cocoa sector is facing a severe challenge,

In its own analysis of the situation, Henley Bridge, which supplies chocolate and other specialist ingredients to professional bakers, chefs, chocolatiers and gelato manufacturers across the UK, also warns price increases of 15-20% for the first half of 2024 could potentially be replicated during the second half of the year.

Its latest cocoa market analysis reveals that, despite growth in global cocoa supply in 2021, unfavourable weather conditions and demand from emerging countries have since led to unprecedented supply deficits.

As the company observed, latest figures released this month reveal that raw cocoa prices have reached a record high of over £4,700 per tonne, significantly more than double the price it was in February 2023 which was around £1,900 per tonne.

Moreover, as the Financial Times reported this week, the situation on price rises has been further impacted as hedge fund speculators have swamped the market in recent months, pouring a total of $8.7 billion into London and New York Futures stock exchange markets, that has further fuelled the rapid escalation of cocoa values.

Report author Steve Calver, commercial director at Henley Bridge, has been following the cocoa markets for over three decades. He commented: “These are historical highs the likes of which I’ve never seen before.

Factors such as global production levels, weather conditions and crop disease play significant roles in shaping price trends. For instance, lower cocoa production in major growing regions, like the Ivory Coast and Ghana, due to adverse weather conditions can contribute to tighter market conditions and influence prices.”

Growing demand for real chocolate from emerging countries, such as India and China, has also contributed to increased pressure on the commodity market.

Dark chocolate was historically cheaper than milk or white chocolate (which contains more sugar and milk powder) but this trend has been completely reversed from an ingredients perspective with dark chocolate now commanding the same or similar pricing.

However, Steve Calver predicts, based on market analysis and future projections, that prices could start to fall as we move into 2025/6. “Due to the high cost of real chocolate, some markets may go back to using imitation chocolate which would, in turn, reduce demand, but that’s just pure speculation at this stage,” he added.

From a distributor perspective, the commercial team at Henley Bridge is working hard to try and soften the blow for customers.

“We held off price increases until February 1, delaying the increase by one month, and are stocking up where possible to hold off further price increases. We’re also trying to give a one month notice period of any impending price increases to give customers time to react.”

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