If you buy or sell chocolate, you have likely felt the pressure of the current cocoa bean shortage. Between 2023 and 2025, the world has seen an unprecedented drop in cocoa supply and a spike in prices. Many business owners, from chocolate makers to small retailers, have had to rethink their plans. Understanding what led to this situation—and what to expect next—is critical in making informed decisions as the industry adjusts.
This guide clears up why the cocoa bean shortage happened, what it means for your operations, and where the industry might go in the near future.
Background and Context: West Africa’s Key Role
To understand today’s cocoa crisis, start with where most of the world’s cocoa comes from. West African countries, especially Côte d’Ivoire and Ghana, account for over 60% of the global supply. These nations are deeply linked to both local economies and the global chocolate market.
When you look at the numbers, the recent shortage is even more striking. The International Cocoa Organization (ICCO) reported a global cocoa deficit of 494,000 tons in 2023-24. That’s the largest shortfall in fifteen years, with production sliding to 4.37 million tons—down 13% from the previous season. Such deficits don’t happen often. The last time stockpiles dropped this rapidly was in the 1970s.
Key Issues and Challenges: Shrinking Supplies and Soaring Prices
The immediate problem? The amount of cocoa available fell far below demand. As a result, global stockpiles shrank 26.8% year-over-year, reaching lows not seen in nearly five decades. This caught both buyers and suppliers off guard.
Cocoa prices responded sharply. By December 2024, futures prices had nearly tripled compared to the start of the year. You may have seen this reflected in retail chocolate prices or in higher costs from suppliers. Companies such as Mondelēz and Hershey announced that increased cocoa costs were squeezing their profit margins and forcing them to forecast lower earnings.
If you are running a chocolate-related business, it is vital to review your pricing strategies and contracts often in such volatile times.
Primary Causes: Climate Change, Diseases, and Aging Trees
Three main forces have combined to create the current shortage:
Climate Change: In West Africa, unusual weather patterns have thrown traditional farming cycles into chaos. Some farms were hit with severe drought, while others saw excess rain that led to flooding. This lack of stability weakened crops and cut yields well below average.
Plant Diseases and Old Trees: Cocoa trees are prone to disease, and much of West Africa’s crop comes from aging plantations. Older trees produce fewer beans and are more likely to get infected. Widespread crop diseases have destroyed significant portions of harvest.
Quality Declines: The rush to bring beans to market in difficult seasons has affected cocoa quality. More beans arrive poorly fermented or contain higher levels of mold. For high-end chocolate makers, much of the current crop is not usable, putting extra pressure on premium segments.
For businesses, poor quality and erratic supply make it hard to plan production and control costs. Keeping track of supplier quality reports and seeking more direct relationships with producers may help you manage risk.
Effects on the Cocoa Supply Chain: Processing Disruptions and Local Impact
By early 2024, the crisis had rippled through the cocoa supply chain. Some processing plants in Côte d’Ivoire and Ghana nearly shut down because of raw material shortages. Factories couldn’t secure enough beans or had to pay prices that made running the business unfeasible.
For local economies, this has enormous consequences. Many farmers earn a living wage only when cocoa prices are stable. During shortages, they face both loss of income and greater uncertainty about the next season. Some have had to abandon their crops or make difficult decisions about investing in new trees or equipment.
If your business depends on cocoa, staying aware of these supply chain chokepoints is crucial. Consider diversifying suppliers and keeping an eye on regional news for signs of further disruption.
Short-term and Future Outlook: Will Cocoa Supplies Recover?
What does the near future look like? Forecasts for 2025 are cautiously optimistic. According to the International Cocoa Organization, better weather across West Africa could help boost yields. Production is expected to increase by as much as 7.8% in the 2024–2025 season. If this happens, cocoa inventories might be rebuilt, reducing price pressure for buyers and sellers alike.
Still, this recovery is not guaranteed. Climate uncertainty, plant diseases, and the challenge of renewing aging plantations remain. Depending on your position in the supply chain, it’s wise to keep flexibility in both pricing and product sourcing for at least another year or two.
You may want to review your contracts more often, budget for further price swings, and plan for gradual rather than instant stabilization. If your business is directly reliant on chocolate products, be prepared for continued pricing and supply adjustments through at least the end of 2025.
Wider Industry Impacts: Prices, Quality, and Sourcing
Many chocolate makers have already responded with price increases or smaller package sizes. Depending on your target market, you may need to update your own pricing or adjust the mix of products you offer.
Another area to consider is ingredient quality. Premium chocolate brands have struggled to secure beans of the quality they require, while mass-market producers may turn to lower grades or blends. This can affect the taste, texture, and even shelf life of finished goods. If you are selling to discerning customers, be sure to track quality certifications and adjust marketing materials to reflect any temporary changes.
The ongoing crisis is also putting a spotlight on sustainable and ethical sourcing. More consumers want to know that their chocolate was produced in fair labor conditions. Be proactive in asking suppliers about their sourcing practices and share these details with your customers. As industry reforms accelerate, there could be an opportunity to position your product as more responsible and sustainable.
If you’re looking for business updates or practical guidance on managing supply chain disruptions, check trusted resources such as Redwire Business, which frequently covers developments relevant for small enterprises.
How Small Businesses Can Respond
You do not need to overhaul your operation overnight. Instead, take a simple, stepwise approach. First, review your supply chain and pricing policies regularly to keep pace with rapid changes.
Next, speak with suppliers about their outlook for the next harvest. If possible, seek forecasts or shared risk agreements that give you visibility and flexibility.
It may also help to communicate early and honestly with your customers. Explain why prices or product offerings may change and emphasize the steps you’re taking to maintain quality and ethical standards.
Depending on your business type, consider short-term promotions or new products that use less cocoa or alternative ingredients. Some bakeries, for example, have featured white chocolate (which uses cocoa butter instead of beans) or developed cocoa-free desserts as a temporary solution.
Keep clear documentation of your approvals, supply agreements, and any product reformulations. Review these records annually as the market changes. Once you have a more stable source of supply, you can gradually expand premium offerings and adjust marketing accordingly.
Conclusion: Navigating the Cocoa Shortage and Looking Forward
The cocoa bean shortage of 2023–2025 has put chocolate makers, sellers, and buyers in a challenging spot. Sharp declines in production, record-high prices, and supply chain disruptions have forced the industry to adapt quickly. The underlying causes—climate change, aging crops, and diseases—are not likely to disappear immediately.
You do have some options. Be sure to stay informed, keep relationships with multiple suppliers, and adjust your pricing and offerings as needed. Consider how to strengthen your sourcing practices and tell your ethical sourcing story if this aligns with your brand and customer values.
While a market recovery is possible if weather improves and investments are made in better farming practices, ongoing risks make it important to remain flexible. By planning ahead, reviewing your agreements, and staying close to suppliers and customers, you can weather the cocoa shortage—and come out stronger when conditions improve.
Also Read:
