With Halloween coming up next week, some consumers will likely be shocked at the price of candy due to the elevated price of cocoa. 😱
The vital ingredient in chocolate is hitting its highest levels since 1979 as hotter and drier weather patterns stunt this year’s crop. Roughly 75% of global cocoa beans come from the Ivory Coast, Ghana, Cameroon, and Nigeria, where consistent temperatures, high humidity, abundant rain, and nitrogen-rich soil allow it to thrive.
But this year, many of those conditions have been absent, with high heat and dryness from El Nino leaving the crop particularly vulnerable. Combine that with a lackluster crop last season, and you’ve got a supply vs. demand imbalance pushing prices to new heights. 📈
According to the National Retail Federation, consumers will spend $3.6 billion on candy this Halloween vs. $3.1 billion in 2022. With the price of candy up 7.5% YoY, those values indicate about 9% volume growth as consumers continue to add sweet treats to their carts. 🍫
Experts warn that although manufacturers try to absorb as much of the higher input costs as possible, “shrinkflation” may be particularly present on shelves this year. You might pay the same price but receive smaller-sized candies than in years past. That may mean more houses handing out “mini” versions of candy this year (or worse, bags of pretzels!). 🥨
Overall, most commodity prices have pulled back significantly from their pandemic highs. But as we’re seeing with Cocoa futures, individual commodity trends continue to develop based on factors like weather, overall demand, and more. 📊