Background on Key Players and Relevance
As the price of cocoa reaches unprecedented levels, potentially impacting production costs by up to 40%, major chocolate companies have implemented various strategies to mitigate these effects without fully transferring the increased raw material cost to consumers. Two key figures in this scenario are Ricardo Bassini, the vice president of Chocolates and Confectionery at Nestlé, and Dirk Van De Put, the president and CEO of Mondelēz International.
Strategies to Mitigate Price Increases
Bassini explained that chocolate companies are focusing on enhancing supply chain efficiency, better managing operational expenses, and optimizing the use of other raw materials. He noted that while cocoa prices have reached record highs, Nestlé has only increased product prices by 8-9%, ensuring consumers are not significantly affected.
Van De Put, from Mondelēz International, acknowledged that if cocoa prices remain elevated, they might raise product prices in the latter half of 2025 and into 2026. However, he anticipates that cocoa prices will eventually decrease.
Causes of Cocoa Price Volatility
The primary factors contributing to cocoa price volatility are climatic conditions, such as droughts and heavy rains, which have negatively impacted harvests in major cocoa-producing countries like Ivory Coast and Ghana. Despite some recovery in 2025, cocoa prices remain high and are unlikely to return to pre-surge levels.
Current Cocoa Price Trends
In 2025, the international cocoa price per tonne has dropped by 30.69%, reaching approximately $8,002. In 2024, the price soared by 177.39% to reach $11,545 per tonne, peaking at a historical high of $12,646 per tonne on December 18, 2024.
Company Responses and Future Outlook
Bassini expressed optimism about the cocoa supply situation, stating that consumers should not worry as there will be chocolate options for all tastes. Meanwhile, Van De Put acknowledged that although Mondelēz International has increased product prices globally, demand has remained relatively stable. They are also optimizing promotions and introducing new flavors and experiences.
Key Questions and Answers
- What is causing the rise in cocoa prices? The primary factors are climatic conditions, such as droughts and heavy rains, which have affected cocoa harvests in major producing countries like Ivory Coast and Ghana.
- How are chocolate companies responding to these price increases? Companies like Nestlé and Mondelēz International are implementing strategies such as supply chain efficiency improvements, better cost management, and optimizing the use of other raw materials to avoid fully passing on increased cocoa costs to consumers.
- What is the current status of cocoa prices? Although cocoa prices reached a historical high of $12,646 per tonne in December 2024, they have since dropped to around $8,002 per tonne in 2025. Despite this decrease, prices remain elevated due to ongoing supply chain challenges.
- How are consumers likely to be affected by these price changes? Both Nestlé and Mondelēz International have stated that they are taking steps to minimize the impact on consumers. Nestlé has increased product prices by only 8-9%, while Mondelēz International has maintained relatively stable demand despite price hikes.
