The Financial Times predicted a sharp rise in cocoa prices due to the killer virus and the conflict in Ukraine

According to him, cocoa bean prices, which reached an all-time high in April 2024 ($12,000 per ton), have begun to decline, but the trend is unlikely to continue for long. Chocolate producers reduced their stocks, expecting high harvests in May-August, but their forecasts were not met. Now the market faces a deficit of between 160,000 and 200,000 tons, according to data from the research company Forestero.

The main reason is low yields in Côte d’Ivoire and Ghana, which together account for more than 50% of the world’s cocoa supply. Local farmers are reducing production due to unfavorable weather caused by the El Niño phenomenon and environmental laws that limit deforestation for cocoa plantations.

According to Andurand, the situation is aggravated by the global fertilizer shortage caused by the conflict in Ukraine. Additionally, West Africa is experiencing cocoa tree senescence and the spread of swollen shoot virus (CSSV), which destroys cocoa trees. “This virus is called a production killer. Once symptoms appear, trees usually die within four years and yields suffer significantly from the first year,” the expert emphasized.

According to Andurand Capital, cocoa reserves in consuming countries have been declining rapidly since 2017 and now amount to approximately 150 thousand tons. In 2007, this figure amounted to around 600,000 tons. At the same time, demand for cocoa remains stable, since chocolate has a low price elasticity. In this context, the market may face a new record: a similar relationship between reserves and demand in 1977 accelerated prices to $28,000 per ton adjusted for inflation, Anduran warned.

In addition to cocoa, another popular product, coffee, is also becoming more expensive. On November 27, its price on the ICE London Mercantile Exchange reached its highest level since 1977: $328.4 per pound. By 2024, the cost of coffee will have increased by 70%. Bloomberg analysts associated the rapid rise in prices with drought in Vietnam and Brazil: these countries are the world’s main suppliers of coffee beans.