World cocoa stocks have fallen to record lows, further exacerbating the crisis in the chocolate market. About this informs Financial Times.
After a few years of harvest, traders and chocolate manufacturers massively buy even low-quality raw materials. Currently, chocolate prices in the US are up 20% year-over-year.
At the same time, cocoa stocks on the London Stock Exchange decreased from 100,000 tons to only 21,000 tons. Manufacturers are forced to look for alternative ingredients as demand for chocolate spikes in the run-up to Valentine’s Day.
The price of cocoa has tripled in the past two years, reaching the highest level in 50 years. In response to rising costs, companies are shrinking tile sizes, changing formulations and looking for ways to reduce costs.
The crisis in the market is so serious that the American Hershey asked the US derivatives regulator to allow it to purchase 90,000 tons of cocoa through the New York Stock Exchange – nine times more than the established limit.
