Hershey is urging the White House to exempt cocoa from tariffs to prevent further price increases on chocolate. The company estimates that tariffs could cost between $15 million to $20 million in the second quarter and potentially up to $100 million in the following quarters as cocoa inventories diminish. Hershey is actively working on mitigation strategies to minimize the impact of these tariffs.
CEO Michele Buck emphasized the need for an exemption on cocoa imports since it cannot be grown in the U.S. The company is collaborating with lawmakers and trade groups to advocate for this tariff exclusion. Hershey, like other chocolate manufacturers, heavily relies on cocoa from Ivory Coast and Ghana, the top cocoa-producing countries in the world.
President Trump’s proposed 21% retaliatory tariffs on Ivory Coast, in addition to the existing 10% tax, pose a significant threat to Hershey’s supply chain. The company is also concerned about retaliatory tariffs imposed by Canada, a key player in cocoa processing.
Hershey’s CFO, Steve Voskuil, highlighted the company’s efforts to influence government policies and revise these tariffs, particularly concerning cocoa imports. Rising cocoa prices, driven by weather challenges, diseases, and increasing consumer demand, have forced confectionary companies like Hershey and Mondelēz International to raise prices in the past year.