Record-High Cocoa Prices: How Climate Change Affects Chocolate Manufacturers and Consumers in Finland

Cocoa crops in Africa have been severely impacted by heavy rains and drought, leading to a devastating price increase for the commodity. This has forced chocolate manufacturers globally to seek alternative raw materials and raise prices for consumers in Finland. According to Bloomberg, the price of cocoa surpassed $10,000 per ton for the first time ever this month, with futures prices rising by about 60 percent in New York alone and more than doubling for the year.

The primary reasons for the price increase can be traced back to Ghana and Ivory Coast, which are the world’s largest producers of cocoa beans. Weather conditions in both countries have led to ruined cocoa crops due to heavy rains and plant diseases affecting trees. The El Niño weather phenomenon in the region has caused fluctuations in rainfall patterns, leaving some areas excessively moist while others are exceptionally dry. Climate change has also played a role in making cocoa cultivation more challenging.

In response to the increased market prices, chocolate manufacturers worldwide have had to adjust their pricing strategies. Some have raised prices while others have reduced product sizes or replaced cocoa with other raw materials such as peanuts or soybeans. Finnish company Fazer has also experienced an impact on their business due to rising cocoa prices leading to price increases for their products. The company is exploring alternative raw materials such as cereals or grains that can replace cocoa while maintaining product quality without altering packaging or taste.

Fazer CEO Lara Saulo emphasizes the need for long-term development work to prepare for future scenarios and mitigate the impact of rising cocoa prices on consumers. In addition, she highlights that there is no significant change in their products yet as it would require changing packaging and potentially impacting taste negatively. However, Fazer is experimenting with cereal-based chocolate bars as an alternative solution that could reduce costs while maintaining product quality.

As a result of these challenges, companies like Fazer are looking for innovative solutions to navigate uncertain markets and ensure a sustainable future for their products.

The industry awaits indications of the autumn cocoa harvest before determining future supply and pricing trends. If conditions do not improve soon enough, consumers may experience further price increases as demand continues to grow despite limited supply.

Overall, these events highlight how climate change can significantly affect agricultural production processes worldwide, leading to commodity shortages and subsequent price increases that can impact global economies.