I was talking to a friend who said she’d “splurged” and paid $95 for a pound of “the most scrumptious chocolate ever.” Aside from questions of sanity, how did we get to $95 for a pound of chocolate? Here’s how:
About 70% of the world’s cacao beans (chocolate’s main ingredient) come from West Africa, where warm, wet climates favor the tree’s growth, giving it a productive lifespan of 60 years before it needs replacing.
For the last 100 years, cacao tree farms have been the livelihood of African farming families, allowing them to eke out a living in an industry where large chocolate companies buy the cacao beans cheap and go on to make the real profits with branded products. Once a tree turns 60, a new one is planted, but it takes 3 to 5 years to see the first cash crop.
Onto the scene step the African millennials who don’t want to wait years to make a hard living, choosing instead to move to the city where jobs and life is better.
Let’s go back to the lands of West Africa. Not only does the climate give life to cacao, but it’s also home to the beloved monkeys. To create a new farm, farmers must encroach on monkey habitat, killing primates in exchange for profit. Naturally, chocolate producers know customers don’t want to buy candy made at the cost of monkeys’ lives, so they swear-off buying from farms that destroy their habitats, further restricting the supply.
Chocolate’s demand continues to surge as the standard of living in places like China and Indonesia rises. With newly increased incomes, people want to live better. What does that look like? You guessed it…chocolate.
The Food Lawyers® Analysis: We have decreasing supplies of cacao from causes that are impossible for any food company to overcome. And we have increased demand for chocolate globally. This means prices are going to go up for a smaller supply of goods. So what’s a socially responsible industry to do? Well, it’s obvious: engage in illegal price fixing.
Over the years, Hershey, Nestle, Cadbury, and others have been charged with conspiracies to jack up chocolate prices. Sometimes they pay millions in government fines, sometimes they pay millions to settle civil suits, and sometimes they dodge the bullet. Oh, and they often lessen the amount of cacao in their chocolate to make it more cheaply. But no matter how you look at it, chocolate is going to take a bite out of consumers’ wallets, sometimes at $95 per pound.