2024-03-23 08:09:34
The price of cocoa has been going from record to record for several weeks. Chocolate makers are starting to feel the impact, and consumers are next in line. If the increase in the price of chocolate must remain limited between now and Easter, the bill might swell in the coming months.
At the Bonneau chocolate factory, in the Montreal district of Ahuntsic, dozens of little rabbits, frogs, owls and chocolate eggs are already on the shelves a few days before Easter. But despite the festive appearance that the store takes on, “it’s very difficult at the moment,” confides to Duty the owner of the establishment, Yves Bonneau. Because someone who has been a master chocolatier for almost 40 years must deal with the meteoric increase in the price of his main raw material.
This is because just a year ago, the price of a tonne of cocoa beans was around US$2,760. Today, its price exceeds US$6,840, a jump of almost 150%.
The cause: unfavorable temperatures and weather conditions which damaged crops in Ivory Coast and Ghana, two West African countries representing nearly 60% of global production of this gourmet commodity.
As a result, industry giants Hershey and Mondelēz International — which are behind Cadbury and Toblerone chocolates, among others — have already hinted that they may soon raise the prices of their confections.
Mr. Bonneau, whose company is not financially as strong as these behemoths, has also had to resolve to increase prices by around 5% to 10% recently. He partly sources cocoa beans imported from Peru, but he also buys already processed chocolate from a large distributor. “The problem is that even if I do not deal with importers from West Africa, it is the world supply of cocoa which is affected by the decline, and that pushes up prices everywhere” , he explains.
Catherine Goulet, founder and owner of the Montreal chocolate factory Avanaa, faces the same problem. The team of less than ten employees makes its chocolate from its shop in the Villeray district. “Prices are rising so quickly… It’s the first time I’ve experienced this,” says Mme Goulet.
Concern is felt by the chocolatier. She sources cocoa beans from Latin America once a year, towards the end of spring. ” It’s soon ! And what is difficult at the moment is securing our orders. Even if we have been doing business with our suppliers for several years, they find themselves with more customers. This increases competition for stocks and, ultimately, prices,” she explains.
Spare the consumer as much as possible
For Mr. Bonneau, “no question” of passing on the entire increase in costs to his customers. “We have no choice but to increase to a certain extent. But with current inflation, we can’t put it off and sell our chocolates at crazy prices. We prefer to reduce our margins and spare the customers who support us,” explains the craftsman.
In addition to the rise in the price of cocoa, that of other raw materials such as sugar is also on the rise. The same goes for the cost of maritime transport, which affects the cost of importing beans by container.
At La Cabosse d’Or, where products made from chocolate imported from Belgium are sold, prices have not yet been too affected, indicates Caroline Crowin. The director of this family chocolate factory in Otterburn Park already placed her “big order of the year” last fall, before the surge in cocoa prices. “We will have to see how to adjust over the coming months,” she said. It’s always a matter of balancing and seeing if customers will be willing to buy our products at the new prices. And if it doesn’t work, then we have to change our product, its format, its packaging,” she says.
Reduce the cocoa content and size of products
To limit the increase in the prices of her products, Catherine Goulet, of the Avanaa chocolate factory, is also considering several options. “I think there are a lot of chocolatiers who are lining up to make chocolates with a slightly lower cocoa content – or focusing a little more on white chocolates to try to control costs a little more,” estimates Mme Goulet.
Economist Sylvain Charlebois, an agri-food expert at Dalhousie University in Nova Scotia, also believes that chocolate products might be affected by the “reduflation” phenomenon. This is the process by which companies reduce the size of their products in order to cushion the shock of rising prices.
“Valentine’s Day chocolates have been spared from price increases. On the other hand, we really think that Easter chocolates are going to be slightly [affectés]. If these are not price increases, it might be a more subtle change: like re-flation,” argues the expert. “You know at Easter, there are always big chocolate eggs filled or empty inside… I think that this year, the eggs will be a little emptier, and that the rabbits will have a little shorter ears” , he warns.
With Frédérique Bouvier
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