By Easter Monday, Cadbury will have sold more than 450 million chocolate eggs and 15 million bunnies in Australia and New Zealand alone, despite the rising price of the festive treats.
Prices are up about 10 percent this year compared to 2023, with a bag of small chocolate eggs rising from $5 to $5.50.
But chocoholics should be warned that a much higher price increase is on the way.
This year’s crop of sweet treats has been spared the full impact of cocoa futures reaching more than $15,300 a tonne because Easter eggs are prepared up to a year in advance before hitting supermarket shelves.
But as production of next year’s Easter treats continues, the price shock will be factored in long before they are in stock for next year’s festivities.
Easter egg prices have risen by about 10 percent this year, but a much bigger price increase is in store for next year. A woman is shown holding a chocolate Easter bunny
Future cocoa prices – an agreement between paying a certain price on a certain date – on the London stock exchange have risen by about 300 percent in the past year and in New York by about 237 percent.
RaboBank expects cocoa prices to fall to around $9,000 per tonne – 124 percent above the average price of the past five years.
RaboResearch analyst Pia Piggott said there has been a reduction in cocoa production in the African countries of Ivory Coast and Ghana – where 60 percent of the world’s cocoa beans are grown.
“It is a combination of a range of agricultural and other factors, including adverse weather conditions, aging trees and crop diseases,” she told the Australian Financial Statement.
‘There are also other challenges for growers, including increasing sustainability regulations and requirements – including in import markets – which also limit supply growth.’
Australian chocolatier Haigh’s does not expect prices to remain at record levels, but does believe cocoa is likely to settle at much higher costs.
“I don’t want to overstate the shift, but the sustainability of the sector means it will increase,” operating officer Peter Millard said.
“In the short term, Haigh’s has secured most of our year-ahead contracts, but if you have to buy on the spot market, we know the industrial warehouses have very little free stock.”
The ever-increasing prices have not reduced sales.
‘We continue to see good growth categories. It’s an affordable moment of joy,” said Darren O’Brien, Australian president of Mondelez International, which owns Cadbury.
This year’s crop of chocolate treats has been spared the full impact of cocoa futures reaching more than $15,300 a tonne because Easter eggs are made so far in advance. A woman is shown looking at Easter eggs and bunnies
He said Easter eggs had bucked the trend of consumers cutting back on spending despite pressures on living costs.
“The relative cost of being able to snack is quite high under any economic environment,” O’Brien told the newspaper. Sydney Morning Herald.
Michael Whitehead, ANZ Bank’s head of agribusiness insights, explained how cocoa futures are having a knock-on effect on chocolate prices.
“The cocoa in the chocolate now on the shelves of retailers and supermarkets was purchased some time ago,” he said.
‘One bad harvest is (not) the end of the world, but because they also had bad weather last year, the farmers didn’t get enough money to buy fertilizer, so that hit things even more.
“If (the cocoa price) remains high for a while, it is reasonable to expect (the cost of) your chocolate block to increase.”
Ms Piggott said that in the past year many chocolate products have seen price increases or ‘shrinkflation’, where the price remained the same but the size of the bar was reduced.