As cocoa futures ease, the worst chocolate price hikes appear to be behind us – but prices will remain well above pre-surge levels, according to a new international report from Rabobank.
RaboResearch agriculture analyst Paul Joules says retail chocolate prices have surged since 2021, the result of poor harvests, crop disease, and structural supply issues.
“This has led manufacturers and retailers to expand their value ranges, offering more affordable alternatives to cost-conscious shoppers,” he says.
The report, Chocolate retail prices hit predicted highs – end of surge in sight, noted that prices are unlikely to return to pre-surge levels due to ongoing structural issues including aging cocoa trees, crop disease, and climate swings, meaning Australian retail prices may be slow to fall.
Today, chocolate prices sit more than 50 per cent above 2021 levels. Manufacturers are employing strategies such as “shrinkflation” to protect margins without losing customers, says Joules.
“Shrinkflation involves reducing pack sizes, while skimpflation changes recipes to lower cocoa content, often replacing cocoa butter with cheaper fats or fillers,” he says.
Joules said large industry players are investing in new cocoa cultivation techniques and cocoa-free innovations to reduce reliance on single supply chains to build future resistance.
“The chocolate market is entering a new era of higher costs and persistent volatility, requiring agility and continuous adaptation from industry players. While the peak of chocolate retail price inflation may be behind us, the pressure remains, and the industry is hedging its bets for a resilient future,” says Joules.
Rabobank Australia and New Zealand Group is part of the international Rabobank Group. The group specialises in food and agribusiness banking in 38 countries.
Read more here.
Photography by RaboBank and Pexels / Eva Bronzini.
If you enjoyed this article, you might also like 5 minutes with Kay-Lene Tan.
Leave a Reply