Major cocoa plants in Ivory Coast and Ghana, key cocoa-producing countries, have either halted or reduced processing operations due to financial constraints preventing them from purchasing cocoa beans. This development is poised to lead to a surge in chocolate prices worldwide, as chocolate-makers grapple with escalating costs amid a prolonged period of poor cocoa harvests in the two nations that collectively account for nearly 60% of global cocoa production.
The surge in cocoa prices, which have more than doubled over the past year and reached record highs, has prompted chocolate manufacturers to raise prices for consumers. The inability of cocoa processors to acquire beans has disrupted the supply chain, as chocolate production relies on processors to transform beans into essential ingredients like butter and liquor.
State-controlled Ivorian bean processor Transcao has ceased bean purchases due to pricing concerns, impacting its processing capacity. Industry sources indicate that the plant is operating at minimal levels, hinting at potential closures of other major state-run plants in Ivory Coast.
In Ghana, the second-largest cocoa producer, most processing plants, including the state-owned Cocoa Processing Company (CPC), have faced intermittent shutdowns since the start of the season in October. The shortage of beans has severely limited operations, with CPC reportedly operating at only 20% capacity.
The challenges faced by cocoa processors in Africa highlight the severity of the global chocolate crisis, as diminishing bean supplies threaten to disrupt chocolate production and drive prices higher. The situation underscores the urgent need for solutions to address the supply chain disruptions and ensure the sustainability of cocoa production in key growing regions.