Cocoa prices have surged globally, reaching over $10,000 a tonne, with July contracts on the New York Intercontinental Exchange hitting $9,163. This significant increase, more than doubling within the year, is primarily due to crop diseases and poor harvests in Ivory Coast and Ghana, which collectively produce about 60% of the world's cocoa. In India, cocoa prices have tripled, affecting manufacturers like Amul, which foresees the necessity for price adjustments in chocolate and related products. Amul's Managing Director mentioned that cocoa prices in India have increased threefold, impacting all major players in the consumer space who utilize pure chocolate.
Campco, a significant cooperative supplier of cocoa products, adjusts its prices based on market trends, passing on cost increases to industrial buyers. While it has not yet altered retail chocolate prices, future revisions may occur depending on market conditions. Parle Products anticipates a 10-15% price hike in cocoa-based products within a few months due to the unprecedented rise in cocoa costs. Strategies like hedging, previously used to manage price volatility, are becoming less effective against such steep price increases.
The price spike has led to a beneficial scenario for cocoa farmers in India's Dakshina Kannada region, where cocoa is grown as an intercrop in arecanut plantations. The price for wet cocoa beans has risen from around ₹65-70 per kg last year to ₹200 per kg recently, illustrating the direct impact of global market trends on local agriculture. This sharp increase in cocoa prices is reshaping the economics of the chocolate industry and the agricultural sectors associated with cocoa production.