Cocoa Market Review 2024 [Global Report]

Cocoa prices have gone crazy in 2024, hitting record highs due to supply chain disruptions, adverse weather, and increased demand. As a key ingredient in confectionery, beverages, and cosmetics, the cocoa market is influenced by several factors including consumer trends and environmental challenges. The growing popularity of chocolate, particularly in emerging markets, along with a rising demand for premium and organic products, are key drivers. However, the sector continues to face hurdles such as price volatility and the impact of climate on production. In major cocoa-producing regions, especially in West Africa, yields are declining due to aging plantations, diseases, and logistical and political challenges. This overview examines how these factors are shaping the market today and their likely implications for the future.

Market dynamics

The cocoa market in 2024 is characterized by a complex interplay of supply and demand factors, price volatility, and the impact of external forces such as climate change and socio-political conditions in key production regions. Understanding these dynamics is crucial for stakeholders to navigate the market effectively.

Supply and demand

The global cocoa market is in supply deficit in 2024. Major cocoa producing countries in West Africa (Ghana and Ivory Coast) are reporting lower yields due to old cocoa trees, diseases and bad weather. These countries account for 70% of the world’s cocoa supply so any disruption in their production is critical to global availability. 

On the demand side, consumption of cocoa products is increasingly driven by demand for cocoa powder, an essential ingredient in chocolate, and other cocoa products in both developed and emerging markets. The rise of premium and organic cocoa products is also contributing to this trend. But the prices are starting to impact consumer behavior and trends like “shrinkflation” are becoming more pronounced where manufacturers are reducing product sizes to maintain price points​.

Price volatility

At the beginning of the year cocoa prices jumped 3.7% in January and 33% in February. This is due to the supply issues and demand. Analysts are predicting cocoa prices to continue to rise for the rest of the year with some forecasting prices to reach 10,111.21 USD/MT by December 2024.

Environmental and social factors

The cocoa industry has many environmental challenges. Climate change is not only affecting weather patterns but also spreading diseases like black pod and cocoa swollen shoot virus. These diseases have wiped out crops in key producing regions resulting in lower yields and higher production costs​.

Social issues like poor working conditions are still plaguing the cocoa industry. Efforts to address these through certification programs and sustainable farming practices are ongoing but require huge investment and international cooperation to be effective. Economic factors like inflation and rising cost of inputs like fertilizers and labor have increased production costs and prices. While political instability in some cocoa producing regions can disrupt production and supply chain and add to market volatility and make it harder to improve industry conditions.

Regional analysis of the cocoa market

West Africa

West Africa, especially Ivory Coast and Ghana, is the center of global cocoa production, supplying around 70% of the world’s cocoa. In 2024, both regions face significant challenges impacting their output and market stability.

Ivory Coast, the largest cocoa producer, has struggled with lower yields due to aging trees, diseases like the cocoa swollen shoot virus, and adverse weather conditions. These issues have reduced supply and driven up prices, heavily affecting the local economy.

Ghana, the second-largest producer, is also dealing with plant diseases and climate disruptions. Despite efforts to improve farming practices and introduce disease-resistant varieties, production has not yet significantly increased. Ghana is also a key player in sustainability initiatives aimed at better farming practices and reducing child labor, supported by international organizations and major chocolate manufacturers.

Latin America

Latin America is becoming a crucial region for cocoa production, with Brazil, Ecuador, and Peru leading the growth.

Brazil has revived its cocoa sector through new technologies and better farming practices. Its diverse climate supports cocoa cultivation across various regions, though challenges like deforestation and land use conflicts remain.

Ecuador, known for its fine-flavor cocoa, remains a key supplier of high-quality beans for premium chocolate. Stable production, favorable climate, and supportive government policies enhance its competitive edge in the global market, making cocoa a significant export for the country.

Southeast Asia

Southeast Asia, including Indonesia, Malaysia, and the Philippines, is becoming a key player in the global cocoa market as an alternative to West African sources.

Indonesia, the largest producer in the region, has boosted production through improved farming practices and disease-resistant varieties. However, challenges like aging plantations and pest management persist.

Malaysia and the Philippines have smaller yet expanding cocoa industries, with ongoing efforts to enhance yield and quality through government and international support. Both countries focus on sustainable practices to ensure long-term viability and better farmer livelihoods.

Europe and North America

Europe is the largest consumer of cocoa products, with countries like Germany, Switzerland, and Belgium being major markets for chocolate. The region is also home to some of the world’s largest chocolate manufacturers​​.

European consumers are increasingly demanding high-quality, sustainable, and ethically sourced cocoa products. This trend is driving companies to invest in sustainability initiatives and certification programs​.
The United States and Canada are major consumers of cocoa products.

The North American market is characterized by a growing demand for premium and organic chocolate. In addition Major North American companies are investing in sustainable sourcing practices and supporting initiatives to improve conditions in cocoa-producing regions​.

Trends and forecasts

Price projections indicate that cocoa prices will remain high in 2024, potentially reaching up to $10,111.21 per ton by December due to persistent supply constraints and strong demand. Production is anticipated to face challenges from climate change, plant diseases, and socio-political issues, which are likely to limit output in the short term. However, regions like Latin America and Southeast Asia may experience moderate production increases due to enhanced agricultural practices.

Global cocoa consumption is expected to grow, particularly in emerging markets such as Asia and Latin America, where rising incomes and a growing middle class are driving demand. In mature markets like Europe and North America, the emphasis will remain on high-quality, premium, and sustainably sourced products.

The shift towards premium and organic cocoa is part of a broader trend driven by consumers’ increasing focus on quality and ethical sourcing. Sustainability and ethical sourcing are now central themes in the cocoa industry, with major players committed to sustainable procurement, fair labor practices, and environmental stewardship. Technological innovations, including disease-resistant cocoa varieties and advanced data analytics, are also playing a key role in improving production efficiency and traceability, further supporting sustainability efforts and quality assurance.

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