Rise in global cocoa prices a bitter reality for local chocolatiers this Easter

Easter is just around the corner and local chocolatiers say a global shortage of cocoa beans has been putting pressure on their businesses and makes it hard to keep prices steady for their customers.

Ted Drew-Smith, president of Reids Chocolate and Nut Shop in Cambridge, says his store buys its chocolate already processed from a third-party company that directly purchases and works with the raw cocoa bean. 

Drew-Smith said they have seen a steady increase in the price of chocolate since the start of the pandemic.

"The price of chocolate has gone up by 40 per cent since November and doubled since last year," he told CBC News.

"We contract our chocolate prices a year in advance, so this year our chocolate prices have gone up by 27 per cent, which is not bad considering, but it's going to continue to go up."

'Production seems to be going down'

Alejandro Marangoni, a professor and Canada Research Chair in the department of food science at the University of Guelph, says the price of chocolate has fluctuated over the decades.

The majority of the world gets their cocoa beans from areas in West Africa, but extreme weather and climate change in those regions has made it difficult for the crop to be successful in recent years, causing a shortage of the raw material. 

"There has been a lot of failure of crops. The trees have not been doing very well with the increase in droughts or floods and increased temperatures, the production seems to be going down," Marangoni said.

"Year after year, the supplies are becoming tighter and tighter and in the last year or so, they have begun exploding. It's interesting because people are talking about 500 per cent increases in the price of cocoa beans for the next year,"

He added demand of chocolate and chocolate products around the world is not going down either, which only adds pressure to the market.

Packaging, transport also increase costs

Like Drew-Smith, Esta Chocolates in Kitchener has seen a steady incline in the price of chocolate, particularly in the last year. Busra Hacioglu says her family's store saw prices quadruple last year. 

Hacioglu said they, too, get the chocolate already processed from a third-party company that gets the raw material. She said any time there's a price increase, those costs trickle down the supply chain to the businesses and eventually the customers. 

She adds there are other factors as well that add pressure on businesses.

"It's pressure on the raw material end for us, but also pressure on packaging and other aspects of doing business, like transportation, all that stuff is also rising in tangent with this," she said.

Hacioglu and Drew-Smith say this makes it hard to keep prices steady for their costumers.

"We don't like raising our prices, but just the way the world has gone the last four, five years, we've had to do a price increase each year and I think it's going to continue to happen," Drew-Smith said.

Rise in chocolate substitutes?

Marangoni said it's likely that some businesses may opt to substitute ingredients in their chocolate recipes to keep costs down.

"I think what you'll probably see are things called candy bars. A lot of product that people think are chocolate, they're not really eating chocolate, it's chocolate flavoured fat," he said.

"If there's not enough chocolate you're going to have to substitute the cheaper products, like an Easter product, with non-cocoa or non-chocolate candy."

He said his lab focuses on the physical properties of foods, including chocolate.

He said they have been working on different technologies he hopes will help the chocolate industry like making the process of tempering chocolate easier and more affordable, as well as create substitutes that closely resemble ingredients like cocoa butter.