Last-minute Halloween shoppers could find spooky price increases on the Candy aisle this year, as a global Cocoa shortage sends chocolate prices surging.
Cocoa prices surged to a 44-year high of $3,786 per metric ton on Monday, after hotter and drier weather attributed in part to El Nino Disrupted Production in West Africa.
Prices for raw and refined sugar have also been rising due to drier-than-normal weather in Asia, creating a perfect storm for candy makers, who may end up passing on higher costs to consumers.
In the US, the annual inflation for candy and chewing gum remained high at 7.5 percent in September, even as overall inflation for groceries settled back down to 2.4 percent.
Cocoa, which is the main ingredient in chocolate, is produced from the cacao bean, which is suffering through a warmer growing season in West Africa, the global hub of production.
Last-minute Halloween shoppers could find spooky price increases on the candy aisle this year, as a global cocoa shortage sends chocolate prices surging
A pile of loose cocoa beans on the floor of the Awazen cocoa processing plant in Abidjan, Ivory Coast in a file photo. Ivory Coast is the world’s biggest cocoa producer
David Branch, an analyst at Wells Fargo’s Agri-Food Institute, told CNBC that the Ivory Coast, Ghana, Cameroon and Nigeria together account for nearly 75 percent of the global cocoa bean harvest.
‘There is not much room for error, which makes cocoa especially vulnerable to climate change,’ said Branch.
Experts say weather-related disruptions have been exacerbated by El Nino, a naturally occurring cycle of warmer waters in the equatorial Pacific.
The National Retail Federation projects that Americans will spend $3.6 billion on candy this Halloween, up from $3.1 billion last year.
Total Halloween spending is expected to reach a record $12.2 billion, exceeding last year’s record of $10.6 billion.
‘More Americans than ever will be reaching into their wallets and spending a record amount of money to celebrate Halloween this year,’ NRF President and CEO Matthew Shay said.
‘Consumers will be shopping early for festive décor and other related items and retailers are prepared with the inventory to help customers and their families take part in this popular and fun tradition.’
In the US, the annual inflation for candy and chewing gum remained high at 7.5 percent in September, even as overall inflation for groceries settled back down to 2.4 percent
Cocoa prices surged to a 44-year high of $3,786 per metric ton on Monday, after hotter and drier weather attributed in part to El Nino disrupted production
Prices for raw and refined sugar have also been rising due to drier-than-normal weather in Asia, creating a perfect storm for candy makers
Candy maker Mars told CNBC that it had not implemented any price increases since June, and that those hikes were in line with increases across the industry.
‘Like many industries, we continue to face high inflation and spikes in material costs; however, we work to absorb these extra costs wherever possible to provide affordable treats and the best value,’ the company said.
Ivory Coast, the world’s top cocoa producer is in its rainy season, which runs officially from April to mid-November.
Harvesting was picking up and more trucks were loading beans in villages, farmers told Reuters on Monday, adding that most of the main crop would leave the bush from mid-November to late January.
Plenty of small pods were appearing on trees, said farmers from the center-western region of Daloa and the central regions of Bongouanou and Yamoussoukro, where rains were above average.
They added that the harvest will be abundant in February and March if it continues to rain until late November.
‘We’re starting to get a lot of cocoa and the conditions are being put in place for a long and abundant (main crop) season,’ said Benjamin Dje, a farmer on the outskirts of Daloa.
