Background on the Situation
The global cocoa market is experiencing an unprecedented price surge, which could potentially increase production costs by up to 40%. To mitigate these effects without passing on the full price increase to consumers, chocolate companies have implemented various strategies.
Key Players and Their Roles
Ricardo Bassini, the Vice President of Chocolates and Confectionery at Nestlé, explained some of these measures. He highlighted improvements in supply chain efficiency, better management of operational costs, and other raw materials.
Measures Taken by Chocolateras
Efficiency Improvements:
- Enhanced supply chain efficiency
- Optimized operational costs
Bassini mentioned that while the cocoa price increase could impact costs by 30-40%, Nestlé has only passed on an 8-9% increase in product prices.
Maintaining Product Availability:
Despite the record-breaking cocoa prices, Nestlé has not reduced its product offerings. Bassini emphasized that their goal is to ensure consumers are not affected by these changes.
Factors Driving Cocoa Price Volatility
Bassini acknowledged that the cocoa price volatility is primarily driven by climatic factors, such as droughts and heavy rains, which have negatively impacted harvests in Ivory Coast and Ghana—the world’s leading cocoa producers.
Price Trends and Future Outlook
Although cocoa prices have shown some recovery in 2025, Bassini believes it’s unlikely they will return to pre-surge levels. In 2024, cocoa prices soared by 177.39% to reach $11,545 per tonne, peaking at a record-breaking $12,646 per tonne on December 18 of the same year.
As of 2025, cocoa prices have dropped by 30.69% to around $8,002 per tonne.
Consumer Impact and Company Strategies
Bassini expressed optimism that cocoa prices will stabilize, ensuring a steady supply of chocolate for all tastes. Meanwhile, Mondelēz International’s CEO, Dirk Van De Put, acknowledged that if cocoa prices remain high, they might increase product prices in the latter half of 2025 and 2026.
Van De Put noted that despite price increases globally, demand has remained relatively stable. The company is also optimizing promotions and introducing new flavors and experiences to maintain consumer interest.
Key Questions and Answers
- What is causing the cocoa price surge? Climatic factors, such as droughts and heavy rains, have negatively affected cocoa harvests in major producing countries like Ivory Coast and Ghana.
- How are chocolate companies responding to the price increase? Companies like Nestlé and Mondelēz International are implementing efficiency improvements, optimizing costs, and maintaining product availability to avoid passing on the full price increase to consumers.
- What is the future outlook for cocoa prices? Although prices have shown some recovery, experts believe they are unlikely to return to pre-surge levels due to ongoing climatic challenges.
- How are chocolate companies ensuring consumer satisfaction amidst price volatility? By focusing on efficiency, cost optimization, and maintaining product availability, chocolate companies aim to minimize the impact of price increases on consumers.
