Cocoa futures in New York and in the other parts of the world have more than doubled since the same period last year, propelling cocoa bean prices to all-time highs.
Farmers in West Africa grow the majority of the world’s cocoa beans, and the crop’s issues are caused by harsh weather.
On Tuesday, March 12, cocoa futures reached a record high of £6,180 per ton in London trading. Cocoa harvests are currently falling short for the third year i
Cocoa futures in New York and other parts of the world have more than doubled since the same period last year, propelling cocoa bean prices to all-time highs.
Farmers in West Africa grow most of the world’s cocoa beans, and the crop’s issues are caused by harsh weather.
On Tuesday, March 12, cocoa futures reached a record high of £6,180 per ton in London trading. Cocoa harvests are currently falling short for the third year in a row. Due to uncertainty regarding future crops, regulators in the top-producing Ivory Coast temporarily halted the sale of cocoa export contracts.
They traded at £1,968 on the same day the prior year. Crop yields in Ghana and Ivory Coast, which produce around two-thirds of the world’s cocoa beans, were impacted by bad weather. Ivory Coast is thought to supply roughly 44% of the world’s supply, with Ghana accounting for about 14% of output.
Cocoa is a susceptible cash crop due to its extraordinary susceptibility to weather variations, notably higher temperatures.
Drier and hotter weather can also transmit diseases to crops, which can have long-term detrimental effects on farming land quality and result in a poor yield. The previous season’s El Niño weather trend resulted in exceptionally high temperatures and rains, causing catastrophic crop destruction.
According to Gro Intelligence, overall rainfall in Ivory Coast’s cocoa-growing regions in 2023 was the highest in 20 years.
El Niño has produced severe drought on cocoa crops, leading to decreased production.
Extreme weather patterns have also affected other commodities. Droughts have devastated rice farms in Thailand and India.
Brazil is the world’s largest sugar exporter, and its shipments have been influenced by excessive rain.
With years of enormous cocoa output, the Ivory Coast produced about half of the global supply, have kept prices low.
The Nigeria Export-Import Bank record holds that the worldwide cocoa sector is worth $200 billion annually. West Africa, which produces 75% of the world’s supply, makes less than $10 billion yearly from the sector.
According to the Cocoa Farmers Association of Nigeria, flames devastated more than 30 hectares of cocoa fields in one of southeast Nigeria’s central producing states early last month.
While the global demand for chocolate expands, the recent double-digit growth in cocoa demand has led to considerable scarcity. The International Cocoa Organization expects demand to exceed supply by more than 370,000 tons this year.
Large chocolate companies, like Nestlé and Cadbury, have raised their pricing to compensate for rising labor and cocoa expenses.
They have intimated that more price rises will occur later this year. According to Barry Callebaut, 18% of its staff would be laid off.
Hershey’s, a prominent American chocolatier, announced plans to decrease 5% of its personnel after reporting an 11.5 percent year-over-year profit decline for the fourth quarter of 2018.
n a row. Due to uncertainty regarding future crops, regulators in the top-producing Ivory Coast temporarily halted the sale of cocoa export contracts.
They traded at £1,968 on the same day prior year. Crop yields in Ghana and Ivory Coast, which produce around two-thirds of the world’s cocoa beans were impacted by bad weather.
Ivory Coast is thought to supply roughly 44% of the world’s supply, with Ghana accounting for about 14% of output.
Cocoa is an extremely sensitive cash crop due to its extraordinary susceptibility to weather variations, particularly higher temperatures.
Drier and hotter weather can also transmit diseases to crops, which can have long-term detrimental effects on farming land quality and result in a poor yield.
The previous season’s El Niño weather trend resulted in exceptionally high temperatures and rains, causing catastrophic crop destruction.
According to Gro Intelligence, overall rainfall in Ivory Coast’s cocoa-growing regions in 2023 was the highest in 20 years.
El Niño has produced severe drought on cocoa crops, leading to decreased production.
Extreme weather patterns have also affected other commodities. Droughts have devastated rice farms in Thailand and India.
Brazil is the world’s largest sugar exporter, and its shipments have been influenced by excessive rain.
Years of huge cocoa output, particularly in neighboring Ivory Coast, which produces about half of the global supply, have kept prices low overall.
The Nigeria Export-Import Bank record holds that the worldwide cocoa sector is worth $200 billion per year. West Africa, which produces 75% of the world’s supply, makes less than $10 billion each year from the sector.
That may be good news for Western consumers, but it has prevented financially challenged farmers from investing in cocoa crops.
According to the Cocoa Farmers Association of Nigeria, flames devastated more than 30 hectares of cocoa fields in one of southeast Nigeria’s major producing states early last month.
Meanwhile, the global demand for chocolate is only expanding. The recent double-digit growth in cocoa demand has led to a considerable scarcity.
The International Cocoa Organization expects demand to exceed supply by more than 370,000 tons this year.
Large chocolate companies, like Nestlé and Cadbury, have raised their pricing to compensate for rising labor and cocoa expenses.
They have intimated that more price rises will occur later this year. According to Barry Callebaut, 18% of its staff would be laid off.
Hershey’s, a prominent American chocolatier, announced plans to decrease 5% of its personnel after reporting an 11.5 percent year-over-year decline in profits for the fourth quarter of 2018.
