The price of cocoa on the global market has skyrocketed in recent months, with a ton of cocoa costing $2,500 in September and now fetching over $10,000. This dramatic increase is expected to lead to significant price hikes in the chocolate industry in the near future, according to Hartwig Kirner, Managing Director of Fairtrade Austria.
Retailers are currently facing empty warehouses as they struggle to obtain cocoa at these exorbitant prices. Several factors have contributed to this spike in prices, including higher transportation costs, energy usage, packaging expenses and labor costs. Katharina Koßdorff, Managing Director of the food industry trade association, highlighted these additional expenses.
The impact of this price increase is already being felt by supermarkets that are experiencing shortages of popular chocolate brands. In response to rising cocoa prices, major companies like Mondelez and Lindt & Sprüngli have announced price increases to offset their costs.
Unfortunately, farmers in main cocoa-producing countries such as Ghana and Ivory Coast have not seen much benefit from this price surge due to state-regulated cocoa prices. The decline in cocoa harvests resulting from climate change has led to shortages and increased smuggling activity. Fairtrade is working hard to help cocoa farmers by offering guaranteed minimum prices and using a Fairtrade Premium to invest in sustainable farming practices.
Despite inflationary pressures, Fairtrade sales in Austria saw a remarkable 12% increase last year. Cocoa beans experienced an even more impressive 13% increase in turnover during the same period. This demonstrates the importance of sustainability to consumers who value ethical products made from responsibly sourced ingredients like Fairtrade’s green coffee and orange juice offerings. As new regulations and market challenges arise for Fairtrade, it remains committed to supporting farmers and promoting ethical practices throughout the cocoa industry.
In summary: The world market price for Cocoa has experienced a significant increase over the past few months due to various factors such as transportation costs, energy usage, packaging expenses and labor costs which has led some retailers face empty warehouses when trying stock up on Cocoa at higher prices than before.
Farmers who produce Cocoa mainly in Ghana and Ivory Coast have not benefited much from this rise due to state regulated prices despite recent decline in harvests resulting from climate change leading shortages and smuggling activities.
Fairtrade is working hard support these farmers by offering guaranteed minimum prices and investing sustainable farming practices while also experiencing growth with their sales seeing a 12% increase last year with Cocoa beans achieving an even more impressive 13% increase turnover during the same period.
Fairtrade remains committed supporting farmers and promoting ethical practices throughout the Cocoa industry despite inflationary pressures arising new regulations or market challenges.