Narrator: This factory is behind the biggest chocolate manufacturer in the world. We make enough chocolate in four days to equal the weight of the Statue of Liberty. Narrator: Here, they pump out 45,000 tonnes of Snickers and peanut M&M's every year. But this year, the cocoa beans needed to make chocolate have gotten a lot more expensive. Kristy: The price of cocoa on the global market did skyrocket to historical highs. Narrator: A dire bean shortage in 2024 pushed the price to an all-time high of over $12,000 a metric ton. It never has happened before. Nobody was able to predict that would ever get to this level. Narrator: Consumers are already seeing candy bars hit shelves with a little less chocolate. So, what's causing the surge in cocoa prices? And what does this mean for chocolate lovers? Joseph Sasu starts harvesting his 17 acres of cocoa.

In the central region of Ghana in October. Inside this healthy pod are the pearly white cocoa beans that will become chocolate. But in the last few years, Joseph has been finding more sick pods like this, completely black or covered in white fuzz. They've been infected with an incurable virus called swollen shoot. You will see that it is very watery, which means it cannot be eaten. Narrator: Tiny mealybugs spread the virus as they feed on the sap of the cocoa trees. Once it takes hold, the leaves can become discolored or die back, stems might swell, and smaller pods may form. After a few years, swollen shoot can kill the plant. Joseph: You quickly cut it [infected pod] off and bury it in the ground. Narrator: Ghana and Ivory Coast grow more than half of the world's cocoa crop, but for the third straight season, there hasn't been enough cocoa to meet global demand.

This year, farmers are projected to harvest over 700,000 metric tons less than the previous season. Now, nearly a third of cocoa farmland in Ghana is infected. I threw almost all my cocoa away because it was badly affected. Narrator: The only way to stop the spread is by cutting down the infected trees and planting new ones, which can take four years to grow fruit. Kristy: Imagine from a smallholder's perspective, you're faced with a choice of removing, eliminating your potential to earn an income, or keeping that tree going for as long as you can. Narrator: That's Kristy Leissle, a 20-year veteran chocolate scholar. The longer you keep a tree around with swollen shoot virus, the more chance it has to spread to surrounding trees. Narrator: Joseph has already removed about 1,500 infected trees within the last five years. Joseph: There are trees here planted by my grandmother over 100 years ago.

Narrator: Another problem is that Ghana's land is also rich in gold, and more and more illegal mining operations, called galamsey, have been taking up land that used to grow cocoa trees. These miners have been known to intimidate farmers into selling their land. Thomas: Some of them even threaten me. They've even come to my house at night to make death threats. But thank God we're still alive. Sometimes they'll take over farms without asking at all. That's what happened to Janet. Armed guards kept her out while miners cut down nearly all of her 6,000 trees to dig gold. They left her land barren and poisoned. Janet: My toil, my livelihood, was destroyed, and it's not easy. It's hurting. It's not as if there's another livelihood anywhere that I can rely on, no. I've no source of income anywhere. Over and over and over again, I have had cocoa farmers really on the verge of tears.

explaining to me that they are no longer able to sell cocoa even if they've retained their own land. Narrator: Galamsey has been growing since the 2000s. Many illegal mines are operated by Chinese companies that have brought in equipment to speed up production and convert farms faster. And more cocoa farms are selling their land, in part due to an economic crisis that sent inflation skyrocketing to 54% in 2022. Kristy: We know that cocoa farmers are very often constrained for cash. This may look like an attractive option if you are really stuck. Unfortunately for them [farmers who sell], they cannot come back. Narrator: Joseph has refused to sell to galamsey even though his trees have been struggling. Parts of Ghana are facing their worst drought in 40 years. Other parts of the country have dealt with heavy rainfall that spoiled beans. Last year, Joseph made less than $1,800 from his farm.

And while cocoa prices are spiking globally because of the shortage, farmers aren't necessarily benefiting from that. That's because they have to sell every single bean they grow to the country's cocoa board, known as the Cocobod. The organization was created in 1947 to protect farmers from volatile global prices. At the beginning of each season, Cocobod sets the price it will pay farmers for their beans. When the price goes down globally, farmers still get the set amount from Cocobod, but if the price goes up, they won't benefit from that. Cocobod is the only organization allowed to market and export Ghana's beans. Its biggest clients are the world's largest chocolate companies, mostly in Europe and North America. Cocobod negotiates contracts with these companies to deliver beans months in the future. That's called the futures market. Because of the shortages, cocoa beans reached a record $12,000 per metric ton.

in April 2024 on the futures market, more than five times what farmers were making then. So some farmers started turning to the black market, selling their crops to smugglers who could pay them more. In an attempt to stop that, Cocobod in September increased what it pays farmers to about $3,000 per metric ton. Cocoa's future price has dropped since April, but it's still about double what it was a year ago. It's a price cocoa processors in Ghana are struggling to pay. Most of West Africa's beans don't stay on the continent. They're exported to the US and Europe, where large multinational corporations turn the beans into valuable chocolate bars. If you look at the value chain of cocoa, money is made in the finished product. Narrator: Lloyd oversees Niche, which roasts and grinds beans. It's one of only about a dozen companies set up to process cocoa in Ghana,

because it's so expensive to do it. Lloyd's been pushing to keep more chocolate production inside his country. Lloyd: We are not consuming our own raw material, so we are pushing for the consumption of our chocolate in Africa. Narrator: This year, that goal got harder. Niche and most Ghanaian factories had to stall production at some point in 2023 because they couldn't afford beans. Despite being much closer to farms, Ghanaian processors have to pay the same price as foreign companies when buying beans from Cocobod. For now, almost all of Lloyd's business is making semifinished products like cocoa butter and cocoa mass, but he wants to make more finished chocolate bars. Lloyd: I'm not going to pride myself in shipping chocolates to Europe. No. I want my chocolate to be consumed in Africa. Narrator: The cocoa crop took hold in Ghana in the 1870s. Around the same time,

the British declared the southern region a colony and began invading north. In the century that followed, cocoa production exploded. Locals owned and ran all the small farms, but the raw product was almost exclusively exported to Europe. A lot of what we know today as contemporary chocolate really grew out of this trading relationship between Ghana and Britain, including the flavor of chocolate itself. Narrator: Although Ghana gained its independence in 1957, it still exports most of its beans abroad, with half ending up in Europe. This has left West Africa with just 5% of the $200 billion chocolate industry, despite it growing about three-fourths of the world's cocoa. And the global surge in price this year has made it even harder for Ghana to change that. This really sets it back with the whole agenda. In the last two years, the outputs even from these artisanal chocolate makers have also had a nose dive. Narrator: Michael runs Fairafric,

a chocolate maker in Amanase, Ghana. While he had to dish out a lot more cash for beans, he didn't have to shut down or pause production. We had to make tough decisions as a company to still stay afloat. Narrator: When we filmed with him two years ago, Fairafric was focused on making finished chocolate bars, pumped into molds in temperature-controlled rooms. But to stay afloat, Michael has pivoted to making chocolate drops, which he sells mostly in Europe to the baking and ice-cream industries. We are doing up to 60% of the container space for just drops. As we stand right now, we are completely sold out for chocolate drops for next year. Narrator: Michael is also focusing on countries like South Africa, which has less competition from big chocolate makers. So, how is all of this affecting prices and production in the US? One of New York City's oldest chocolate houses

had to cut costs too. Well, we use a high percentage of cocoa in our product, right? And so I think that's why we're probably getting hit harder. Narrator: Anthony Cirone co-owns the century-old company Li-Lac Chocolates. He buys these 10-pound blocks from Cargill in Minnesota, one of the world's largest chocolate processors. We melt it down, we temper it, and we use it as an ingredient in our recipes. We renewed our chocolate contract this year. Our prices were up 62% versus last year. As you can imagine, that was a big hit. Narrator: Anthony had to raise prices on a few items in March, but most of his sweets haven't seen an increase. We made the decision to accept lower margins through the season. That means through Christmas. So some of our items, we haven't taken a price increase for two years, and despite the chocolate prices, we decided not to.

Narrator: Luckily, the company saw a 9% increase in sales this year, which has helped, and Anthony hopes he'll see another bump this fall and holiday season. Anthony: We're in Halloween season now, but the day after Halloween, Thanksgiving items are going to show up. So we're making items like our turkeys. This one's 13 ½ pounds. Producer: That's 8 pounds?! Yeah, it's 8 pounds, almost 9. Narrator: To make these huge sculptures, workers paint on colorful details with dyed white chocolate. So they'll do one color, put it in the cooler, bring it out, do the second color, and so and so forth. Narrator: They fill them up from this fountain for the shell. Li-Lac has about 1,000 specialty molds in its collection. Anthony: The Empire State Building. A chocolate pizza slice. These are very popular, we have a car collection.

Here we have whales. And we make these delicious chocolate high heels that come painted. And we also make these chocolate handbags. Narrator: But more than half of the company's store sales come from treats in the cases: nonpareils, truffles, chocolate-covered pretzels. Workers pipe, unmold, and package each one by hand. Anthony: Everything that we do here is old school. There's a lot of labor involved. Narrator: The Brooklyn factory makes 175,000 pounds of chocolate a year and has followed the same recipes since the 1920s. Anthony: Almond bark is probably our No. 1 bestselling product of everything that we make. It's got two ingredients, chocolate and almonds. Narrator: Still, Anthony isn't sure he'll be able to hold pricing on these handmade products if cocoa gets more expensive. Anthony: If chocolate prices continue to go up next year,

I mean, that's going to affect our business, and at some point, we'll probably have to take price increases, but we're trying to hold off as long as we can. Narrator: Multinational chocolate companies are also pivoting. The big companies have more options for managing that price increase. Use less cocoa in their products. Put other stuff into your products: nuts, marshmallows. In 2020, Mondelēz dropped the size of many of its Cadbury chocolate bar multipacks. In 2019, Hershey's cut down its 18-ounce Kisses pack by almost 2 ounces. Hershey's also launched a new chocolate-frosted-doughnut Kit Kat that's just dipped in chocolate, not completely coated, and a Reese's cup filled with caramel as well as peanut butter. In 2023, Nestlé shrunk its fun-sized Kit Kat bars by 17% in Australia.

Mars Wrigley slimmed down its Galaxy chocolate bar in the UK by 10 grams. We visited Mars Wrigley's chocolate factory in Topeka, Kansas, which makes Snickers, Milky Ways, and peanut M&M's. It's a pressure, but it goes through cycles like every other commodity. Narrator: Tim LeBel, Mars Wrigley's chief Halloween officer — yes, that's his real title — maintains that the company hasn't touched its recipes in the US. Before we pass on a price increase to a consumer, we look at every possible angle to take costs out of the system in a responsible way. Narrator: The company said it can turn to cutting manufacturing and material costs when cocoa prices go up. Mars Wrigley says it has increased its suggested pricing for retailers. Tim: Like any company, there's been pricing over the last couple of years done in a way

where we believe it's a responsible way to do it. Narrator: When we visited the factory, it was producing enough candy each day to stretch about 120 miles. This year, we are going to make the most Halloween candy that we've ever made in Topeka. Mars' Topeka factory gets the majority of its cocoa from West Africa and makes 1.5 million pounds of chocolate in-house every week. Its Milky Ways are nougat and caramel, enrobed in chocolate. Our 3 Musketeers-Milky Way line, it's actually our largest and longest fill-bar line in the world for Mars Wrigley. Narrator: Mars' Snickers are milk chocolate filled with caramel and peanuts. And while regular M&M's are mostly milk chocolate, the peanut ones are mostly, well, nuts. Brian: Every day we roast enough peanuts that they're equal to the weight of a fire truck.

Narrator: The peanuts get coated in chocolate and then covered in a colorful candy shell made of sugar. Brian: Yeah, a lot of people believe that the color of the M&M makes the flavor change, but really it doesn't. They're the exact same flavor in all the colors. Narrator: While workers aren't allowed to taste-test straight off the line, they can do visual checks every hour. Brian: They're making sure that the product is the right size, the right shape, the right decorations, has the M's on them, that the colors are right, and if something looks wrong, all of our associates have the authority to shut the line down. Narrator: A meter makes sure each bag is getting the right amount of each color. My wife is never sick of me bringing home chocolate or coming home smelling like chocolate. Narrator: But Mars Wrigley is seeing a trend that could bring some hope.

We have some of our fastest-growing items in the fruity section. Narrator: In its annual report, the company found that while chocolate was still its favorite, gummies, fruit, and sour candies were more popular among younger generations. Tim: We're very fortunate where we have three platforms for our fruity business. We have Life Savers, Starburst, and Skittles. Sours is a big thing right now, so we're looking to introduce sour-based products in the gummy area. Narrator: Mars Wrigley also found that younger customers like variety. So the company launched these packs for Halloween, which include both chocolate and gummies. So I think we're well positioned to take on any headwinds or tailwinds that come our way. Narrator: But what does all this mean for customers? Well, besides maybe a little less cocoa in your chocolate bar, you might also have to shell out some extra cash.

Hershey's and Cadbury have also raised prices, meaning your money might not go as far to fill up your Halloween bucket this year. The best thing you can do is to prepare your expectations for some kind of change. That may be fewer bars on shelves, may mean that your best-loved chocolate candy looks a little bit different. I think we have been living with chocolate as an everyday luxury for generations now. So I think that it is probably wise for people to start thinking of chocolate as something a little bit more precious than we have done in the past.

Cocoa Prices Reached All-Time Highs. What Does That Mean For Our Halloween Chocolate? | Big Business

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Cocoa Prices Reached All-Time Highs. What Does That Mean For Our Halloween Chocolate? | Big Business

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