Global cocoa markets are experiencing diverse dynamics. Papua New Guinea faces a delayed cocoa harvest, raising local prices. Meanwhile, increased Ivory Coast bean deliveries depress global prices. Confectionery companies react by adjusting product lines.
Cocoa Supply and Pricing Dynamics
Cocoa production in Papua New Guinea’s East New Britain province is presently facing a delayed flush. Typically occurring between September and December, this flush is vital for the region’s cocoa harvesting cycle. With this delay, local exporters are experiencing intensified competition due to limited cocoa availability, resulting in elevated prices ranging from K1750 to K1760 per bag. Despite these challenges, the current abundance of pods on trees offers optimism for satisfactory yields before season change in November.
Meanwhile, cocoa futures in New York are under pressure with prices falling over 5% due to increased bean deliveries from the Ivory Coast. Port arrivals in Ivory Coast are up by 13% compared to last year, capitalizing on favorable weather conditions. The Ivory Coast, maintaining its position as a leading cocoa producer, has revised its harvest forecast upward by 10% to 2.1-2.2 million tonnes for the 2024/25 season. This shift highlights the diverse realities within global cocoa markets, affecting price dynamics and market strategies.
Read more:
- Late cocoa flush in East New Britain – postcourier.com.pg
- The Commodities Feed : Chinese Oil Import Quota Increased – menafn.com
Cocoa Price Fluctuations and Impacts
This Halloween, heightened cocoa prices have led to a transformation in the confectionery aisle, with candy companies opting for fewer chocolate items and a larger assortment of non-chocolate treats such as gummies and licorice. This shift is primarily driven by financial pressures due to adverse weather conditions affecting cocoa yields in West Africa, where an estimated 70% of the world’s cocoa is harvested. Companies are compensating for high cocoa costs through shrinkflation—keeping prices constant while reducing product size—and reformulating products to use less cocoa by incorporating alternative ingredients. This approach is likely a temporary fix until cocoa supply stabilizes, which experts predict may not happen until 2025, impacting not just Halloween but also major candy-centric holidays like Christmas and Valentine’s Day.
Read more:
- Halloween shrinkflation : How candy companies are adapting amid cocoa crunch – National – globalnews.ca
- Halloween could taste different this year thanks to soaring cocoa prices – us.cnn.com
- Urban demand in mega cities under stress , food inflation a cause of concern : Nestle India CMD – www.thehindubusinessline.com
Sustainable Cocoa Production and Farmer Well-being
The Cocoa Farmers Association of Nigeria (CFAN) has urged the Nigerian government to enhance sustainable cocoa production by focusing on local processing and consumption. This initiative could significantly improve the country’s value chain and meet European Union regulations. CFAN’s recent communiqué calls for harmonized data collection on cocoa production and an increased awareness campaign regarding EU Deforestation Regulations. These actions aim to align Nigeria with international standards and support local farmers in adopting best practices.
In a strategic move to foster cocoa farming communities in Côte d’Ivoire, Hershey has signed a five-year agreement with local cooperatives under its “Cocoa For Good” initiative. This forms part of the company’s $500 million investment aimed at overcoming challenges faced by cocoa farmers. The agreement, made public during the National Cocoa and Chocolate Days, highlights Hershey’s commitment to improving farmer incomes and sustainability. It also aligns with national efforts in Côte d’Ivoire to develop a resilient and sustainable cocoa sector, emphasising the importance of public-private partnerships.
Read more:
- Farmers push for stronger govt involvement in cocoa production – punchng.com
- Hershey Signs Groundbreaking Long – Term Agreement With Cocoa Cooperatives Aimed At Improving Farmer Income And Farm Resiliency – menafn.com
Conclusion
The cocoa market is expected to remain volatile in the near term. Delayed harvest in Papua New Guinea may sustain regional price spikes, yet global prices might stabilize due to increased production in Ivory Coast. Cocoa demand, particularly from large chocolate producers, may continue to fluctuate amid alternative ingredient trends and shrinkflation. Sustainable practices and collaborations, such as those initiated by firms like Hershey, could gradually enhance productivity and farmer welfare, supporting long-term market stability by 2025. Increased domestic processing and compliance with European Union standards may further bolster supply chain resilience. These factors present both challenges and opportunities for stakeholders across the cocoa industry.
In other news:
- Australia top artisan chocolatiers and their best chocolates | The Standard – standard.net.au
- Stakeholder involvement key in preventing cocoa smuggling – COCOBOD – www.ghanaweb.com
- Cocoa farmers educated on effective disease management – jamaica-gleaner.com
- Futures File : Hogs get hammered , cattle beefed – up – www.nwitimes.com
- French Chocolate Maker Charts Course for 200 – TEU Sailing Cargo Ship , Launching in 2027 – gcaptain.com
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The opinions and views expressed are those of the author and should not be relied upon for making investment decisions.
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