Poor harvest

Bitter! The next price shock is imminent

The price of cocoa beans has recently multiplied.

(Bild: stock.adobe.com/stock.adobe.com, krone.at-Grafik)

Bad news for all chocolate lovers in the country. Because the cocoa harvest has recently been poor, the world market price has multiplied this year. Chocolate manufacturers now have to buy much more expensive cocoa. This will also have a massive impact on prices in the stores.

"The chocolate companies have their backs to the wall," says Fairtrade Austria Managing Director Hartwig Kirner. Many of the large and small producers now have to stock up on cocoa again and sign contracts. However, the recent poor harvests have caused the price to rise dramatically on the world market.

In recent years, the price has always been between 2,000 and 3,000 US dollars per tonne, but this year it even rose to over 11,000 US dollars. Most recently, the price fell to just under 8,000 US dollars (see chart).

(Bild: stock.adobe)

Empty warehouses and too little supply
As a result, chocolate manufacturers are having to dig much deeper into their pockets. Even though the price of cocoa is regulated by the state in the important producing countries of Ghana and the Ivory Coast, international commodity traders are demanding market prices. "Chocolate will have to become significantly more expensive," Kirner sums up.

The scale of the increase will also depend on the extent to which the increased costs can be passed on to the trade. In addition to their own products, many chocolate manufacturers also produce private labels. Kirner: "As a producer, you can't just shrug it off."

Fairtrade Austria boss Hartwig Kirner

(Bild: Fairtrade/Günter Felbermayer, Krone KREATIV)

Fairtrade sales increased further in the previous year
Fair food continues to be very popular with Austrians. Sales of products with the Fairtrade seal of approval increased by around twelve percent to around 663 million euros in the previous year. Chocolate and cocoa were among the drivers.

For example, the confectionery manufacturer Manner (at Casali) and the discounters Hofer and Action switched other own brands to "Fairtrade cocoa". The coffee segment has also seen stable development, as more and more products in the premium segment are also being certified. One in three bananas is already Fairtrade and 96% of them are organic. Roses, which achieved record sales during the coronavirus pandemic and then declined sharply, are also on the rise again (+7.9%). Here we are slowly approaching pre-crisis levels. In total, there are already 2,500 products with the Fairtrade seal in Germany, as well as a good 2,000 cafés, bakeries, hotels, restaurants and canteens that offer "fair" food.

Small farmers from the Ivory Coast drying cocoa beans.

(Bild: FAIRTRADE/Christoph Köstlin)

Almost 80 million US dollars in direct income for farming families
Weather extremes, crop failures, supply bottlenecks and higher costs place an enormous burden on the income of smallholder families in Africa, Asia and Latin America. However, Fairtrade sales in Austria have recently made it possible to pay almost 80 million US dollars (+9 percent) in direct payments to producer communities. Premiums that exceed the minimum prices can be used to finance community projects (well construction, schools, infrastructure, etc.).