Since early-2024, the global food and beverage industry has been closely monitoring a significant development: the sharp rise in cocoa prices. In recent months, cocoa prices have soared to unprecedented levels prompting widespread concern across multiple sectors. This spike is driven by a combination of environmental, economic, and regulatory factors, affecting everyone from farmers to end consumers.
Understanding the Cocoa Supply Chain
To grasp the current situation, it’s important to first understand where cocoa comes from. Approximately 80% of the world's cocoa is produced in West Africa, with Cote d'Ivoire (Ivory Coast) and Ghana being the largest contributors. These countries are favored for cocoa cultivation due to their warm, tropical climates—ideal conditions for cocoa trees.
What’s Driving the Supply Shortage?
The dramatic increase in cocoa prices stems primarily from a global supply shortage—demand for cocoa now far exceeds the available supply. Several key issues have contributed to this imbalance:
Extreme Weather Conditions in West Africa
As the majority of cocoa production is concentrated in West Africa, any adverse weather events in the region can have major global repercussions. Recently, this area has experienced severe storms, intense heat waves, and prolonged droughts—conditions that have disrupted cocoa yields and significantly hampered production.
The Spread of Cacao Swollen Shoot Virus (CSSV)
Another major contributor is the rise of Cacao Swollen Shoot Virus, a rapidly spreading disease affecting cocoa trees. This virus reduces yields significantly in its early stages and eventually kills the tree over a few years. It can also spread from tree to tree, compounding the damage across entire farms and further reducing output.
Chronic Underinvestment in Cocoa Farming
Despite being a multi-billion-dollar industry, cocoa farming remains underfunded at the grassroots level. Many farmers receive a disproportionately small share of the final product’s value and lack the resources to reinvest in their land. This has led to aging plantations and low replanting rates, which in turn diminish long-term production capacity.
New European Deforestation Regulations
In late 2024, new EU legislation took effect requiring stricter due diligence on cocoa sourcing. The regulations prohibit cocoa from land that has been deforested within the last four years, and many smallholder farmers struggle to meet these compliance requirements. As a result, some farms have ceased operations entirely, further reducing global supply.
The Ripple Effect on Consumers
The implications of this supply shortage are being felt worldwide. Higher cocoa prices inevitably lead to increased costs for chocolate and cocoa-based beverages. Every stage of the supply chain—from farmers to manufacturers to retailers—has had to adjust prices, and consumers are bearing the brunt of these changes. This was particularly evident during the 2025 Valentine’s Day season, where chocolate prices rose by approximately 10%.
While other cocoa-producing regions are ramping up investment to meet growing demand, cocoa trees take four to six years to mature and bear fruit. These are long-term solutions, and in the short term, prices are expected to remain volatile and elevated.
The current surge in cocoa prices is a complex issue rooted in climate challenges, plant disease, economic inequality, and evolving global regulations. As supply struggles to keep up with demand, the ripple effects are being felt across the entire value chain—from smallholder farmers to multinational producers and everyday consumers. While long-term solutions are in motion, including increased investment in sustainable cocoa farming and new regions entering the market, these efforts will take years to bear fruit. In the meantime, businesses and consumers alike must adapt to the realities of a changing cocoa landscape. Understanding the causes behind these price hikes is the first step in navigating what lies ahead for the food and beverage industry.
Despite these global challenges, TCX remains committed to offering quality chocolate products at fair and accessible prices. Over the years, we’ve only adjusted the price of our chocolate powder once, and we continue to work closely with our partners to ensure stability and reliability in our offerings. As always, our priority is to support our clients with consistency they can count on—even in uncertain times.