The cocoa futures contract for May delivery surged to an all-time intraday high of $10,080 per metric ton Tuesday.
Major chocolate companies have been using hedging strategies to manage the price volatility and avoid passing on higher prices to consumers.
But consumers could start to feel the effect as West Africa faces systemic issues that have led to a historic supply deficit with no easy solutions.
The world is facing the largest cocoa supply deficit in more than 60 years and consumers could start to see the effect at the end of this year or early 2025, Joules said. The International Cocoa Organization has forecast a supply deficit of 374,000 tons for the 2023-24 season, a 405% increase from a deficit of 74,000 tons in the previous season.
“The worst is still yet to come,” Joules said. Cocoa prices will likely remain elevated for some time because there are no easy fixes to the systemic issues facing the market, he said.
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