Chocolate boxes and truffles will cost more this Valentine’s Day as confection makers pass on higher cocoa prices to consumers already paying more for their favorite sweets.
Cocoa futures have doubled since Oct. 1, according to an analysis released by cryptocurrency exchange ChicksX. This was the highest price increase for the commodity in half a century, Progressive Farmer reported.
Al Alof, the CEO of ChicksX, said in a statement the decline in the cocoa supply will continue to create challenges for candy and chocolate.
“Companies might need to raise the prices of chocolate due to the rise in ingredients prices, of which cocoa is one,” he said. “Small businesses that use chocolate may be forced to buy ingredients in smaller amounts too, which may see them missing out on bulk purchase savings, further compounding the squeeze.”
Supply issues for cocoa have been fueled by inclement weather and labor issues in West Africa where the majority of the crop is grown. Heavy rain last summer was followed by a drought in the fall, leading to a drop in production. Cocoa production in the Ivory Coast in 2024 reportedly fell 22.4% compared to 2023, Wells Fargo found.
Last Halloween, candy producers such as Hershey reportedly increased the production of sweets that do not contain cocoa because of the higher costs for the ingredient.
The confectionery giant’s trick-or-treat candy lineup included smaller sizes of products like Hershey’s milk chocolate, as well as non-chocolate items like cinnamon-flavored Kit-Kat and Shaq-a-Licious XL Gummies.
David Branch, sector manager at Wells Fargo’s Agri-Food Institute, told Food Dive last October the issues with cocoa are so significant that premium chocolate makers will continue to charge more for their luxury items. Companies making more affordable confections — such as Hershey, Nestlé and Mars — will struggle to keep up with demand if the trends continue, he predicted.
Chocolate accounted for a record $21.4 billion in confectionery sales during the last year, with 65% of consumers indulging in the confection, according to an October report from the National Confectioners Association.
In Hershey’s November earnings call, CFO Steve Voskuil said increased cocoa costs that it will incur during the next year will amount to “a pretty significant step up.” The volatility, he told investors, will undoubtedly impact Hershey’s fiscal performance, but that the company is not sure to what extent.