Your favorite chocolate no longer contains chocolate but still costs the same: What’s happening?

The famous “reflation” that plagues candy lovers at Halloween will continue to be a problem this year, as cocoa prices have reached their highest level in the last 44 years. In an effort to maintain profitability, the world’s largest candy manufacturers have begun Replace, reduce, and even eliminate chocolate altogether of its major products, usually without modifying the original price.

The New York chocolate futures market (a strategy for manufacturers to reduce risk by buying eight or nine months in advance) has been well below $3,500 per metric ton every year from 1980 to 2023. But that changed on February 22, when Exceeded US$6,000 per tonne for the first timeAnd the forecasts are not at all optimistic, experts told Bloomberg.

“We are actively trying to find ways to absorb the increasing costs of raw materials and operations,” a Bloomberg spokesperson told Bloomberg. Mars planet, the over 113-year-old company behind the famous Twix bars and M&Ms. “Reduce the size of our products This is not a decision we have taken lightly.,

The candies are smaller, but the price is the same

Last year, Mars made a judicious 10 gram reduction in its popular Galaxy chocolate bars without reducing the price. This year, instead of promoting its traditional candy, it spent a million dollars on the Super Bowl to advertise its peanut butter-filled M&Ms. Other brands also joined the trend, either using automation to cut production costs or promoting products with other flavors and less cocoa.

to shelter Introduced more hazelnuts into its range of Aero chocolate bars, which now weigh only about 36 grams due to their air bubbles One third the weight of competing chocolate bars, And hershey Its Reese’s added caramel and frosted donut flavors to its KitKat line, partially but not completely dipped in chocolate.

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Carl Quash, head of snacks and nutrition at the company, told Bloomberg that today, more than 40% of molded and segmented chocolate bars sold in the United States are filled with something else, whether candy, nuts or fruit. Market monitoring company Euromonitor International. “With cocoa prices high, we will see more innovations like this reaching the market,” he said.

Nobody “needs” chocolate.

The problem is that if there’s one thing consumers are willing to give up without a second thought, it’s chocolate. According to a survey published in October by consumer intelligence company NIQ, consumers are most willing to spend on sweets and chocolates if inflation continues, behind only alcohol and makeup.

“Income growth from cocoa is expected to be limited this year,” Hershey CEO Michelle Buck acknowledged this in a call with analysts. Prices for Hershey products rose 6.5% in the fourth quarter; While the prices of its confectionery, chocolate and other sweets in North America are expected to increase by 9% in 2023.

Buck said the company is “actively evaluating bundling pricing architecture opportunities to help ensure the right offering and pricing to meet evolving consumer needs.” “Given the situation with cocoa prices, We will use all the tools we have“As a way of managing the business, including pricing,” he said.

Why is chocolate more expensive?

The main reason for the increase in prices is a common factor that has affected many industries for years: climate change. Rain and disease in West Africa, home to more than 60% of global cocoa production, are damaging crop yields and, of course, limiting supply. Some estimates cited by CNN in February US$529 million loss In the cocoa bean value chain in Africa.

ClimateAI agronomist Sabi Ibarra Guerrero told CNN that up to 30% of crops could be lost in major producers Ghana and Ivory Coast. These losses are expected to be primarily caused by high temperatures and heavy rainfall at the beginning of the growing season, increasing the susceptibility to black pod disease caused by parasites such as fungi.

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