Enjoy your Easter eggs this year. They will cost more in 2025

Snacking and confectionery giant Cadbury’s manufacturing facility in Victoria’s Ringwood produces two million Easter eggs every day.

By the time Easter is over, it will have sold more than 450 million of the chocolate eggs and 15 million chocolate bunnies to customers in Australia and New Zealand.

“The machines never stop running,” said Darren O’Brien, Australian president of Mondelez International, which owns the Cadbury, Oreo, and Toblerone brands, as well as Philadelphia cream, Natural Confectionery Co and belVita biscuits.

“Year round, we have to produce to have the volume of eggs to sell in that very short window.”

Cadbury’s chocolate production at the factory in Ringwood, Victoria.

As higher interest rates and inflation push up the cost of living, consumers have pulled back on their online shopping and dining out; they have shopped around for groceries; and they have haggled for better deals on tech purchases.

But it appears chocolate has been able to buck this broader trend of consumer cautiousness as O’Brien says more and more Easter eggs are being sold every year.

“We’re continuing to see good growth categories. It’s an affordable moment of joy,” O’Brien said. “The relative cost of being able to snack is one that tends to be pretty robust in any sort of economic circumstance.”

Darren O’Brien, Mondelez International president of Australia, New Zealand and Japan in his Melbourne office.Credit: Louis Trerise

Australians can expect to pay broadly the same for Cadbury’s bestsellers as they did last year: a 150g Easter bunny still costs $6.70; a 250g Easter bunny will set you back $8; and a medium gift box is still $10. The price of a bag of small chocolate eggs has risen from $5 to $5.50.

But the cost of chocolate is unlikely to stay at current levels for long. Since the start of 2024, the trading price of cocoa has skyrocketed from $US4275 a tonne to more than $US8000, the highest it has ever been. The last record high was set in July 1977 at $4663.

Heavier rainfall in the region where most of the world’s cocoa is produced, the west African nations of Ghana, Ivory Coast, Cameroon and Nigeria, has caused disease in cocoa trees, squeezing supply for chocolate makers. This year, west African cocoa farmers are facing El Nino weather patterns of dry temperatures and extreme winds, which would make it the third year in a row of smaller cocoa harvests.

But chocolate lovers won’t feel the impact of the recent dramatic uptick in cocoa prices right away.

“The cocoa that’s gone into the chocolate that is on the shelves of retailers and supermarkets right now has been purchased quite a while ago,” ANZ head of agribusiness insights Michael Whitehead said.

“One bad crop [isn’t] the end of the world but because they had bad weather last year, too, the farmers didn’t get enough money to buy fertiliser, so that hit things even more.

“If [the cocoa price] stays high for a while, it’s pretty reasonable to expect the [cost of] your chocolate block will go up.”

Koko Black owner Simon Crowe says Easter chocolate production is up 20 per cent on last year but he has flagged price rises to come.Credit: Simon Schluter

Simon Crowe, the founder of burger chain Grill’d who bought artisanal chocolate brand Koko Black out of administration in early 2016, has been pleased to see chocolate sales 20 per cent higher than last year.

But the cost of making chocolate is getting more expensive. “The price of manufacturing is going up across the board. Cocoa prices have gone through the roof,” he said.

In the new financial year, Koko Black customers will be paying a little more for their handmade treats.

“The next crop isn’t harvested until about September, October. It means therefore it’s likely prices will go higher between now and then. That hurts us, undoubtedly,” he said.

“We haven’t yet taken a price increase only because we’ve had locked-in contracts. But when those contracts expire, we know that we’ll take small increases, and we’ll consider those carefully across the range.”

It’s not just cocoa prices that chocolate makers have to manage. The cost of sugar hit a 13-year high in January as an extreme dry spell hit India and Thailand, two major sugar exporters. And the price of milk in Australia has increased amid long-term declines in production and sharply rising supply chain costs.

“Chocolate companies will absolutely be doing some scenario planning now,” said Whitehead. “They will also presumably be thinking, ‘all right, how do we plan for Easter 2025 if [another bad crop] happens?’.”

Getting efficient

In the face of rising input costs, chocolate makers will need to work harder to keep the price low, which will be imperative to keep sales up. As much as snacks might appear recession-proof, consumers are acutely sensitive to price points. An ABS study last year found chocolate was the No.1 most “elastic” food category: a 1 per cent increase in price would result in a 7 per cent decrease in sales.

O’Brien is conscious of this. “One of the things that drives efficiency in our business is selling volume. And when prices go up, volumes tend to come off,” he said.

Mondelez International has invested $34 million into bulking up its chocolate-making lines in its Ringwood facility, so it will be able to double the number of Easter eggs made to 970 million by next year.

Koko Black’s manufacturing site is in Victoria’s Coburg, but Crowe – anticipating expansion and long-term growth – is on the hunt for larger digs.

“We need to move to a purpose-built facility, and we’re looking for that option now so that we can actually find and build something that’s going to take us forward to the next five to 10 years,” he said.

Even if chocolate does become more pricey, people might buy less – but they probably won’t stop altogether.

“Try explaining food elasticity to your kids if they want to look for chocolate eggs in the garden on Sunday morning,” said Whitehead.

“People will still pay what it costs for chocolate at Easter.”

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