‘Difficult decision’: Cadbury increases chocolate prices again as cocoa crisis continues

Cadbury has made the “difficult decision” to once again raise the price of its chocolate and it’s not the only brand, with the “worst is yet to come” for shoppers.

Cadbury has made the “difficult decision” to once again raise the price of its standard chocolate block to $7, as soaring costs including energy and cocoa continue to push the popular treat further into “special occasion” territory.

The price of cocoa has more than doubled this year as poor weather conditions in West Africa, the largest cocoa-producing region in the world responsible for 70 per cent of supply, devastated crops.

While major companies like Cadbury owner Mondelēz International raise prices, smaller chocolate makers are also feeling the pinch, and some have already been forced out of business.

“There’s some that have gone under,” said Helen Curtis, who runs boutique chocolate maker Federation Chocolate with her husband just outside of Hobart.

“Everything is becoming more expensive. It’s getting harder to make a product and keep it at a price that people can afford and still allows you to function as a business.”

Federation Chocolate’s Maurice and Helen Curtis with their daughter Rose. Picture: Supplied

Ms Curtis said the price of cocoa beans, which make up 80 per cent of the cost of their chocolate, had risen at least 50 per cent over the past two years.

“Our standard block is $11.95 and we are going to have to look at raising that price again shortly,” she said.

“It’s that scary thing if you raise it too much, you scare people away. We know certainly once you get to that $15 for a block of chocolate that’s going to be quite a hard sell.”

Ms Curtis said the situation was tough for Australia’s “bean to bar” community — smaller, premium chocolate makers who source their own cocoa.

“All of us are noticing price increases and areas where people have previously gotten beans from they can’t this season,” she said.

The husband-and-wife duo have run Federation Chocolate for the past 10 years, and diversified with a vineyard three years ago. They now offer wine tastings and “chocolate experiences”.

“If we were just doing chocolate we would very much be struggling,” Ms Curtis said.

Federation Chocolate sources beans from around eight countries including Papua New Guinea and Peru.

Ms Curtis said her “firm belief is there should not be cheap chocolate out in the market”.

Mondelēz International’s Cadbury factory in Tasmania. Picture: David Caird

“We pay our growers a premium rate and as a result we get a very premium product, but historically farmers are not being paid enough for their product,” she said.

“As regular commercial chocolate becomes more expensive, we’re hoping people [will instead say] let’s treat ourselves to really good chocolate for that bit more.”

She noted that 100 years ago chocolate was a “premium product, something you bought for special occasions”.

“It wasn’t an everyday food group, which is what it’s become,” she said. “The amount of effort that went into gorgeous chocolate boxes … part of us goes, it would be so lovely if we were back in that zone where chocolate was this quality product to be savoured.”

A spokeswoman for Mondelēz International confirmed that “after careful consideration, we have made the difficult decision” earlier this month to increase the recommended retail price (RRP) of the 180-gram Cadbury Dairy Milk family block from $6 to $7.

It comes after Freddo Frog and Caramello Koala jumped from $1 to $2 in August, the first price increase for the beloved products in more than a decade.

“Like many other food companies, we’re continuing to face unprecedented increases in costs across our supply chain including energy and cocoa prices, which have reached historic highs,” she said.

Cocoa prices have skyrocketed due to poor weather in West Africa. Picture: news.com.au

“At the same time, we understand the economic pressures that consumers continue to face — so we work hard to absorb these continuing cost increases where possible. In order to continue to provide consumers with the brands they love, without compromising on the great taste and quality they expect, we have a range of actions we can take when necessary to ensure ongoing supply of our products which may include a mix of RRP increases, changes in pack sizes, and/or changes in the mix of products and promotions across markets.”

The latest price increase “is necessary to ensure that we can continue providing the premium chocolate experience our consumers have come to expect from Cadbury”.

“We are grateful for the continued support from our consumers as we navigate these challenges,” she said. “Our dedication to producing top-quality chocolate in Australia, with the best local ingredients, remains our top priority.”

Haigh’s, Australia’s most well known premium chocolate brand, now charges $14.90 for its 100-gram premium chocolate bar.

Haigh’s Chocolates chief operating officer Peter Millard said the company had “felt the impact of rising cocoa and ingredient prices, as have other producers within the chocolate industry”.

“As bean-to-bar specialists, Haigh’s is passionate about producing high-quality chocolate, which is only possible through the use of high-quality ingredients, including cocoa beans,” Mr Millard said in a statement.

Federation Chocolate has diversified into wine tasting and ‘chocolate experiences’. Picture: Supplied

“Recently the price of Haigh’s Chocolates has increased due to the rising costs of cocoa, ingredients, labour and other factors that are essential to create the unique blend of handmade premium milk and dark chocolate varieties in our range.”

Mr Millard said despite rising prices and interest rates, consumer demand for Haigh’s Chocolates “chocolates remains steady nationally”.

“Haigh’s expects the current high spot pricing is a short term peak but may result in long term pricing higher than has been the case over the last decade,” he said.

“Haigh’s remain optimistic that the best practice sustainable farming will deliver reliable supply from the growing regions.”

Unfortunately “the worst is yet to come”, Rabobank warned in September, as cocoa stockpiles that manufacturers had relied on for the past 18 months run dry.

“Due to the lag in the supply chain and existing contracts, the steepest price hikes are anticipated in the second half of 2024 and into 2025,” RaboResearch analyst Paul Joules said.

“This would inevitably lead to higher prices for consumers, particularly for dark chocolates with higher cocoa content.”

Cocoa commodity prices hit a 50-year high earlier this year, peaking at around $US12,000 per metric ton.

“The International Cocoa Organisation (ICCO) reports a 14.2 per cent drop in global cocoa production for the 2023/24 season, leading to a shortage of approximately 462,000 metric tons and the lowest cocoa stocks in 22 years,” Mr Joules said.

He noted the June quarter Consumer Price Index data from the Australian Bureau of Statistics showed year-on-year inflation in the snacks and confectionery category — of which chocolate is part — was running at 4.6 per cent

“This followed a similar-sized year-on-year jump seen in the June 2023 quarter, so the cumulative increase in this category between June 2022 and June 2024 is 21.8 per cent,” Mr Joules said.

Speaking to NBC News this week, Ghanaian farmer Daniel Amponsah Gyinayeh, 66, said harvesting cocoa had become more difficult in recent years.

“We have lived on cocoa money until now,” Mr Gyinayeh said.

“[Then] climate change started to come in, things became different. It was like hell for cocoa farmers. The yield dropped, reduced drastically, and poverty was everywhere.”