Global cocoa prices have reached a new record high due to dry weather damaging crops in West Africa. Cocoa prices on the New York commodities market rose to $5,874 a ton on Thursday, double the price at the beginning of 2016. The rising prices are impacting consumers and chocolate manufacturers. Hershey, one of the world’s largest chocolate manufacturers, warned that historic cocoa prices would limit earnings growth this year. Mondelez, the company behind the Cadbury brand, has also identified rising ingredient costs as a challenge for the year ahead. Poor harvests in West Africa have driven up cocoa prices, with El Niño exacerbating the impact.
Last month, consumer group Which? revealed that festive chocolate box prices had risen by at least 50% in a year. While overall UK supermarket food and drink inflation fell to 8.3% in November, the rise in chocolate prices was 15.3%. The El Niño weather phenomenon has caused drier weather in Ghana and the Ivory Coast, which produce the majority of global cocoa supplies. Changes in rainfall patterns and higher temperatures caused by climate change can also damage cocoa harvests.
Analyst Jack Scoville of Price Futures Group warned that traders are concerned about another year of poor harvests in West Africa. He said that these concerns had been exacerbated by the El Niño weather phenomenon, which threatens cocoa crops in the region with hot and dry weather.
