Easter is a busy time for Kishoree Boegel. The chocolatier sells treats, like hand-painted bonbons and molded chocolate high heeled shoes, at her shop Cocoa Tree Confectionary in Mequon, Wisconsin.
“My sales, as far as chocolate go, are very cyclical,” said Boegel, who opened the business in 2020. She said she’s also busy around other holidays like Valentine’s Day and Mother’s Day.
But recently, Boegel has had to pay more for the chocolate she needs to make her products, which has cut into her profits.
The price for cocoa – the main ingredient in chocolate – has soared over the past three years. The surge is mainly due to small harvests in West Africa, where the bulk of the world’s cocoa is grown. Climate change has brought extreme heat to the area, which has limited the crop’s production.
“We're sort of in uncharted territory here,” said David Ortega, a food economist and professor at Michigan State University. “We haven’t seen input prices for chocolatiers increase to this magnitude before, at least over the past three, four decades.”
The higher input costs for chocolate producers pushes the price of chocolate up for consumers, too, he said.
At Cocoa Tree Confectionary, Boegel is rethinking her chocolate inventory. She said she can’t charge more for her bonbons, or her customers won’t pay. And she’s worried costs could go up even more with tariffs.
“You have to cut corners. You have to decide what you're not going to sell, as far as your product line,” Boegel said. “You know, you have to make some very tough choices.”
Cocoa costs
The price for a metric ton of cocoa beans soared to nearly $12,700 in December, up drastically from the $2,200 it cost in August 2022.
While that price has come down slightly in recent months, the prices are still high, said David Branch, sector manager at Wells Fargo Agri-Food Institute.
“It's been on an upward trend and floating up in the stratosphere between $11,000 and $8,000 or $9,000 for the last couple of years,” Branch said. “This has all been driven by three years of declining supply, mainly from West Africa, which typically produces about 70% of all the cocoa beans grown in the world.”
Cocoa is the processed seeds of a cacao tree, which are sensitive to weather changes and are only grown in a specific region close to the equator. Extreme weather and climate change patterns such as excessive heat and abnormal rainfall have upended harvests in West Africa, according to United Nations Trade and Development. Insect-borne infections have also affected cacao growth.
Alexis Villacis, an applied microeconomist at Ohio State University, said bigger chocolate companies, like Hershey or Mondelez International, can buy large amounts of cocoa to protect themselves from price fluctuations. But smaller chocolate processors do not have those types of resources.
“So those are the ones that we have seen, at least anecdotally, are closing down their operations because they cannot keep with these price increases,” Villacis said. “And at the end of the day, it's up to the consumers to decide if they want to pay two or three times more for a chocolate product from these small chocolate producers.”
He said some manufacturers have shrunk the amount of chocolate they’re selling in a package for the same price – a practice economists call “shrinkflation.” Another response has been reducing the amount of chocolate in a product.
Villacis expects cocoa prices to settle around $6,000 per metric ton, which is still higher than previous prices. But that could change if extreme weather continues.
Ortega said the Trump Administration’s recent tariffs could also make chocolate products more expensive.
“The vast majority of the cacao and the cocoa that we consume in the form of chocolate is imported into the United States from places in West Africa, countries like Ghana, Cote d'Ivoire, Cameroon, Nigeria, even countries in Latin America, like Ecuador, produce cacao,” Ortega said.
An ‘affordable luxury’
But Ortega said people still tend to buy chocolate.
Unlike eggs, which have seen their own price hike in recent months and are viewed as a necessity with few substitutes, Ortega said chocolate is considered an affordable luxury.
Chocolate accounted for a record $21.4 billion in confectionary sales for the year ending in August 2024, according to the National Confectioners Association. The association notes that in the face of increased food costs and economic uncertainty, Americans treat themselves and others to chocolate.
“In the grand scheme of things when we look at broader food prices, and even outside of the food category, chocolate still is priced relatively lower than a lot of the other expenses that we spend our money on,” Ortega said. “So especially around these times and holidays people like to splurge and sort of treat themselves.”
This story was produced in partnership with Harvest Public Media, a collaboration of public media newsrooms in the Midwest. It reports on food systems, agriculture and rural issues.
