It’s Easter weekend and in many countries around the world people celebrate by giving each other chocolate Easter eggs.
There could be some worrying news though for people who enjoy eating these chocolate eggs as well as anyone who enjoys eating chocolate in general.
The price of chocolate is rocketing and in the last year alone cocoa prices have risen by 20% and it seems that the price rises will continue.
So, what is causing the increase in chocolate price?
The answer is that it is a simple case of supply and demand.
In December, the International Cocoa Organisation said there could be a 150,000 tonne deficit in the amount of cocoa beans produced in 2014.
There is a significant lead time in cultivating cocoa crops so the supply of cocoa will remain relatively static. In addition, the supply problems are being compounded by prospects of an El Nino weather pattern which can result in crop damaging dry winds in some of the leading cocoa growing countries in West Africa such as Ghana and the Ivory Coast.
Demand on the other hand is surging.
According to Euromonitor the value of chocolate consumption in major emerging markets such as Asia and Latin America will grow at more than double the rate of the world average in the next 5 years.
It’s estimated that consumers in the Asia Pacific region will eat 1.096 million tonnes of chocolate by 2018. This represents a 27% increase from 2013 and compares to a 5% increase in Western Europe (the biggest current buyer of chocolate) over the same period.
So in conclusion, there are supply problems, rocketing demand and higher chocolate prices seem inevitable.
What better excuse therefore is needed to buy that extra chocolate bar now before prices rise?