Valentine’s Day chocolate boxes and truffles will come at a higher price this year as confection makers pass on the increased cocoa costs to consumers who are already paying more for their favorite sweets.
According to an analysis by cryptocurrency exchange ChicksX, cocoa futures have doubled since Oct. 1, marking the highest price increase for the commodity in fifty years, as reported by Progressive Farmer.
ChicksX CEO Al Alof stated that the cocoa supply decline will pose challenges for the candy and chocolate industry, potentially leading to price hikes. He mentioned that smaller businesses might struggle to afford ingredients due to the rising costs, impacting their ability to buy in bulk and save on purchases.
Supply issues for cocoa have been exacerbated by adverse weather conditions and labor problems in West Africa, where the majority of the crop is cultivated. A combination of heavy rain followed by drought led to a decrease in cocoa production, with a 22.4% drop reported in Ivory Coast in 2024 compared to the previous year.
During Halloween, candy producers like Hershey responded to the higher cocoa costs by increasing the production of sweets that do not contain cocoa. The company introduced smaller sizes of chocolate products and non-chocolate items to offset the ingredient expenses.
Wells Fargo’s Agri-Food Institute sector manager, David Branch, predicted that premium chocolate makers will continue to raise prices for luxury items due to the cocoa challenges. He also suggested that companies producing more affordable confections, such as Hershey, Nestlé, and Mars, may struggle to meet demand if the trends persist.
According to a report from the National Confectioners Association, chocolate generated a record $21.4 billion in sales last year, with 65% of consumers enjoying the confection.
In Hershey’s November earnings call, CFO Steve Voskuil highlighted the significant increase in cocoa costs expected in the coming year, acknowledging the impact on the company’s financial performance.