Chocolate maker and cacao tree farmer Chris Jahnke says consumers will “inevitably” pay more for chocolate in the future as global cacao prices skyrocket.

The North-Queensland based executive director of Charley’s Chocolate tells TND that a “perfect storm” has hit cacao markets as farmers in West Africa suffer bad weather and diseased crops.

“There’s no question about that … it will flow through [to consumers],” Jahnke warned.

“We’re all trying to work out furiously what the future looks like, but those costs will have to be passed on.”

A report from agricultural analysts at Rabobank this week declared that the “worst is yet to come” for chocolate prices, with big manufacturers being squeezed by the “cacao crisis”.

That includes Nestle – owner of KitKat and Smarties – as well as Mondelez International – owner of Cadbury – which were previously safeguarded by long-term contracts, but are now exposed.

More hikes next year

“They’re really being forced to pass this on,” Rabobank analyst Paul Joules said.

“Consumers will likely see more price hikes next year.”

Global cacao markets “shattered” their previous price range last year and things have only worsened since, with a shortage of 462,000 tonnes in 2023-24 amid the lowest stock levels in 22 years.

The price of cacao futures has more than tripled since last year and is just short of record highs.

“This has been going on for about a year now,” Joules said. “In West Africa, where we see 70 per cent of the world’s cacao production, we’ve had a number of different supply issues.

“There’s been tree crop disease and farmers exiting cacao because they weren’t [previously] receiving high enough prices.”

Boost for Aussie growers

Jahnke said there is a silver lining for Australia’s much smaller cacao industry, with higher prices making the higher quality domestic product more competitive in the wider market.

“In a bizarre way, it’s made the Australian grown product more competitive because it’s reduced that disparity,” he said.

Charley’s executive director Chris Jahnke.

Consumers will need to get used to paying more for chocolate over the medium-term though, Jahnke said, predicting that prices will ease somewhat but not back to the levels they once were.

The price of some treats has already risen, with biscuit maker Arnotts’ raising the price of Tim Tams earlier this week, sparking a fierce backlash from shoppers online.

A spokesperson for Nestle recognised that cacao prices have “escalated sharply” in 2024.

“The cost of cocoa is a considerable factor in the price of our chocolate, but not the only one,” they said.

“We have not passed on all of the cost increases, but are working hard to keep prices as low as possible to keep our products affordable.”

‘Range of actions’

A Mondelez International spokesperson said they’re also navigating higher cocoa prices, saying it may respond with a “range of actions”.

That may include “a mix of RRP [recommended retail price] increases, changes in packet size, and/or changes in the mix of products and promotions across markets”.

Jahnke said chocolates with a lower quantity of cocoa won’t see their prices rise to the same degree as other varieties, including dark chocolate, which has a much higher level of cocoa.

Kit-Kats, for example, contain less chocolate than other treats because there’s a wafer in the middle.

“Milk chocolate, particularly from the major manufacturers, even in a chocolate bar, only has somewhere between 25 per cent to 30 per cent cocoa – that’s in a solid block,” Jahnke said.

“So the impact will be less there and more with other people.”