Why the price of your favourite chocolate might jump soon

afr.com:

Chocoholics may be in for a shock at the checkout after the price of cocoa soared to a 12-year high and heavy rain across West Africa accelerated the spread of a rot-causing disease.

Cocoa has jumped from $US2356 a metric tonne in July last year to $US3353 on Wednesday, according to Nasdaq. Bloomberg is citing $US3369 a metric tonne cocoa futures on the September contract.

Michael Germanos, executive pastry chef at Melbourne-based Bibelot, says the rising price of cocoa will force consumers to pay more for their favourite chocolate. Eamon Gallagher

The global price of sugar also hit close to US27¢ a pound in May – the highest since 2011 – after trading for less than US10¢ in April 2020.

Michael Germanos, executive pastry chef at Bibelot, a cafe and artisanal chocolate retailer in Melbourne, says his entire range has been recosted, and most of the $5 chocolate is rising by $2.

But 12 interest rate rises in 14 months have kneecapped discretionary spending for luxury items such as premium chocolate, meaning any price increase is fraught with danger.

A 1 per cent increase in chocolate prices caused the amount of chocolate bought to fall by 7.4 per cent, ABS researchers Robert Ewing, Leigh Merrington and Paul Atyeo found in research released in May.

“Our production costs are skyrocketing,” Mr Germanos told The Australian Financial Review.

“Finding the right balance now is very tricky. Even though we have loyal customers, there is a fine line between having a luxury product and putting it out of reach. There’s a lot of strain on people. Someone who used to buy four or five chocolates here now just buys one.”

Haigh’s Chocolates chief operating officer Peter Millard said the Adelaide-based company also might have to increase