Cocoa is cultivated 20 degrees north and south of the equator. Four countries — Ivory Coast, Ghana, Cameroon and Nigeria — produce nearly 75% of the world's cocoa. The king is Ivory Coast, which in a normal year produces 2 million tons – compared with global consumption of 5 million tons.

While production is in the south, consumption is in the north. Europe is the largest importer of cocoa beans worldwide, with 56% of global imports. To compare, North America and Latin America together account for about 17% of global cocoa bean imports, and Asia for 26%. Also, the largest processor of cocoa is Europe. Cocoa beans are processed into cocoa mass, cocoa butter, cocoa powder, chocolate or other cocoa products. One third of the annual harvest is ground in Europe.

Globally, seven multinational companies represent the bulk of the market for final chocolate products: Nestlé, Mondelez, Mars, Hershey, Lindt & Sprüngli and Ferrero. The chocolate market size is estimated at $109.13 billion in 2024, and is expected to reach $145.14 billion by 2030, growing at a CAGR of 4.87%. Compared to other regions, Europe plays a major role in the sales of chocolates and registered a growth rate of 12.37% from 2020 to 2023 by value.

This increase in consumption has seen cocoa prices rise lately due to the current global supply shortfall and moreover, the unfavourable weather situation in West Africa triggered by the el Nino phenomenon that is exacerbating the bullish prices. The weather changes, which intensify from January to March, lead to higher temperatures and changes in rainfall patterns. This reduces the yield of existing plantations and also increases the incidence of pests and diseases.

Since the start of the 2023/24 season, arrivals at Ivorian ports are estimated to be down by 34% year-on-year to 1.051 million tonnes as at 4 February 2024. In Ghana, graded and sealed cocoa purchases were down year-on-year by 35% to 351,000 tonnes. Unfortunately, the current issues with the African supply cannot be mitigated by the Americas, the second region by size, as the beans it produces attract a high premium and are expensive because of their fine flavour attributes. This situation is pushing the prices of cocoa on the exchanges to new time highs, the commodity currently trading at over $6600 per ton. To give a context, last year at the beginning of March the price was around $2700 per ton. This means the price more than doubled over the last 12 months.

But the drought in West Africa is not the only challenge facing cocoa farmers. Climate change will force them to move their plantations to higher ground. This will create a climate more conducive to cocoa growth. These measures will increase the cost of cocoa production and prices are likely to remain high.

In Romania in the last 12 months the cocoa and coffee prices increased almost 9% according to the National Statistics Institute. The increase in price of the cocoa will eventually create shrinkflation and it is not impossible to see, in the near future, the 90 grams chocolate tablet at the price of the 100 grams ones. The trend is already manifesting in the UK with Mars reducing the weight of one of its Galaxy bars by 10 grams without reducing its price.