In 2025, the cocoa industry is still facing the worst crisis in its history. This crisis started to escalate in early 2024, due to factors such as climate change, weather extremes, and disease outbreaks, causing profound ripple effects that impacted the entire global chocolate production line.
Unsurprisingly, manufacturers are also feeling the pressure due to supply chain uncertainty and increased prices, which may reduce consumer demand, especially for premium chocolate products. Furthermore, ethical and sustainability pressures are also mounting, with consumers expecting companies to be transparent in their cocoa sourcing practices. Therefore, no cocoa manufacturer has any choice but to adapt to the changing market landscape in order to meet customers’ expectations and avoid damaging their reputation.
The reasons behind the cocoa crisis
The primary cause of the global cocoa crisis is climate change, which has been profoundly impacting West Africa, particularly in countries like Ghana and Côte d’Ivoire, disrupting local climate patterns. Due to this, there are long periods of heavy rainfall in these regions, followed by prolonged droughts, which affect harvests and farm productivity.
Furthermore, viruses are affecting cocoa trees, thus decreasing yields. These two countries are the world’s largest cocoa producers, accounting for more than 70% of the global supply; however, in 2024, there was a significant decrease of 13.1% due to these issues.
Another alarming issue is that part of the harvested beans no longer meets the quality standards required for use in chocolate. Emerging problems, such as excessive humidity, poor fermentation, and mold, which are all adverse effects of climate change, have a negative impact on the quality and purity of cocoa. While large companies in the market buy all sorts of beans, regardless of their quality, this decline affects producers who want to supply premium markets.
How manufacturers are responding to the cocoa crisis
In the face of these ongoing challenges, chocolate companies must adapt and find innovative ways to meet consumer demand. Here are some of the approaches they are taking:
· Decreasing cocoa content to keep costs down. One way manufacturers are tackling the cocoa crisis is by reformulating products that allow them to maintain the same quality while reducing costs. Some companies are decreasing the cocoa content in their recipes or reducing product sizes while maintaining price points, a phenomenon known as shrinkflation. This tactic can be effective, but it’s paramount to implement it with transparency, because otherwise, companies risk facing consumer backlash.
· Exploring alternatives to cocoa. Another solution that cocoa companies have increasingly turned to is finding substitutes for cocoa. For instance, yeast-based ingredients can be used to replace up to 40% of cocoa powder while preserving texture and taste. Other alternatives are plant-based proteins and cocoa butter replacers, but while they provide functional benefits, careful formulation is needed to ensure product appeal.
· Creating new value for consumers. One of the best practices when addressing the cocoa crisis is to create new value for consumers. This can be achieved by emphasizing health benefits and premium quality, which helps foster stronger relationships with customers. Most importantly, embracing ethical sourcing practices is crucial, as it’s simply what is expected from chocolate brands during these times and will definitely make a difference. Transparency is necessary in order to showcase sustainability efforts to consumers, and brands can leverage the power of storytelling to talk about their initiatives, such as buying cocoa wholesale from a reliable supplier such as ofi who focuses on both quality and sustainability. Furthermore, brands can make a difference by ensuring that farmers receive fairer wages for their products. Emphasizing these practices can go a long way in enhancing brand loyalty during such challenging times.
Will there be an end to the cocoa crisis, or is it time to say goodbye to the world’s favorite treat?
The cocoa crisis has been deeply disrupting the tranquility of the chocolate industry, and unfortunately, things aren’t likely to change anytime soon – or at least, not in the way they are expected to. According to industry experts, it is expected to remain prevalent throughout this year and beyond. While prices may stabilize in the end, there won’t be a return to the previous prices before the cocoa crisis happened. Therefore, companies will have no other option but to adapt to the “new normal” in order to mitigate cost increases and, at the same time, align with consumer expectations. Sustainable practices, processes and products, innovation in product offerings, and transparent communication with consumers will all be essential in keeping brands afloat in this new landscape.
When it comes to consumers, they won’t likely stop buying chocolate products for good, given how deeply attached they are to their unique taste. However, one thing is certain: their buying habits will not remain the same. There’s a noticeable increase in demand for organic chocolate brands, with customers more likely to purchase products that claim to be environmentally responsible. While taste remains an essential driver of chocolate purchases, consumers are also increasingly seeking healthier options, such as plant-based and low-sugar products, which can come at a premium price. Despite the challenges that the cocoa industry has been facing, chocolate remains a preferred indulgence, and holidays and special occasions are critical for sales. In fact, extended celebration periods provide marketers with a longer window to capitalize on seasonal demand.
The bottom line
The cocoa crisis has been sending shockwaves across the entire industry, testing the agility of manufacturers. As prices remain high, companies must look for ways to adapt, not only in sourcing and production, but also in their relationships with consumers who are becoming increasingly eco-conscious and changing their buying habits. Decreasing cocoa content, opting for alternatives to cocoa, and creating new value for consumers are just some of the strategies that they are implementing to address the ongoing challenges.
Without a doubt, in this new landscape, the businesses that will tread this fine line between ensuring profit and building customer loyalty will put themselves in the best position to survive the storm that has wreaked havoc within the cocoa sector.
