Valentine’s Day to cost more as butter, sugar, cocoa prices surge

This year’s Valentine’s Day is set to be modestly expensive as the cocoa prices surge. Data shows that cocoa, price has jumped to its highest point since 1977 and is slowly nearing its highest point on record. It has risen in the past four straight weeks and by over 124% from its lowest level in December 2022.

The ongoing cocoa price surge means that chocolates, which are some of the most popular Valentine’s Day gifts will cost much higher this year. That’s because chocolate bars are made using cocoa, which is sourced mostly in Ghana and Ivory Coast. Cocoa is now nearing $5,000 per metric ton. It was trading at $1,700 in 2017. 

Cocoa price chart

There are two main reasons why the price of cocoa is surging. First, it has soared because of weather effects in the two countries. Instead of drought, most cocoa planting regions have seen more water than usual which has affected yields. Second, cocoa has jumped because of a disease known s pod rots, which is also caused by more humidity.

The challenge for the cocoa market is that these plants take long to grow and only a few regions can support cocoa production. As a result, buyers now have no option than to pay more for these products.

Cocoa is not the only chocolate ingredient that is soaring. Data compiled by Barchart shows that the spot butter price at the CME has risen to $274, up from the December low of $243. Sugar prices have also soared by over 157% from their lowest point in 2020.

The surging cocoa prices is not hurting some of the biggest chocolate makers in the world. Mondelez said that its organic revenue rose by 14.7% in the final quarter of the year to $4.6 billion. Precisely, the revenue of its chocolate brands like Cadbury Dary Milk jumped by more than 11% in the quarter. As a result, Mondelez stock price has surged to a record high.