Favorable market conditions seen as sweet boost for cacao industry

Upgrade to High-Speed Internet for only ₱1499/month!

Enjoy up to 100 Mbps fiber broadband, perfect for browsing, streaming, and gaming.

Visit Suniway.ph to learn

September 1, 2026 | 12:00am

MANILA, Philippines — The country’s cacao industry may be entering a sweet spot for expansion, with favorable market conditions providing fresh momentum, according to the University of Asia and the Pacific-Center for Food and Agri Business (UA&P-CFA).

In a policy brief, UA&P-CFA said the Philippines’ cacao industry could have a strong potential for continued growth and greater competitiveness due to rising farmgate prices and a growing international profile.

Local cacao prices, at the farmgate level, have continued to increase to P243 per kilo in 2025 from just P92 per kilo in 2021 due to supply disruption from major cocoa-producing countries.

This created better opportunities for Philippine cacao producers and supported higher farmgate prices.

Yet a bitter truth remains: the country’s productivity remains low, and output has only gradually increased in the past five years. The Philippines also remains an importer of cocoa products to fill local demand, despite rising exports.

“The industry continues to face a supply-demand gap, providing room for local producers to increase production and participate more fully in the growing cacao and chocolate market,” the briefer said.

Local cacao farms only produce about 0.5 to one kilo of dried cacao beans per tree per year, lower than the industry-set yield target of two kilos per tree per year.

The report added that the low productivity limits farmers’ income and constrains the industry’s ability to meet growing domestic and export demand.

Coupled with low productivity of cacao trees, output has only inched up over the past five years to 11,870 metric tons in 2025 from 10,000 MT in 2021.

Among major producing areas was the Davao Region, dubbed the “Cacao Capital of the Philippines,” making up 68.7 percent of the national output of 8,150 MT due to its favorable climate and adequate rainfall.

This was followed by Calabarzon producing 7.1 percent, Zamboanga Peninsula with 5.3 percent and Soccsksargen with 2.7 percent.

Cacao production remains limited to smallholder farmers, farmer organizations and cooperatives as well as several commercial farms and enterprises.

Among major industry players are Kennemer Foods International Inc., Malagos Agri-Ventures Corp., Kablon Farms and other regional cacao growers’ associations.

Major brands engaged in cacao processing and chocolate manufacturing include Malagos Chocolate, Auro Chocolate, Theo & Philo Artisan Chocolates, Dalareich Chocolate, 1919 Chocolate and MS3 Agri-Ventures Corp.

The report noted that several of these have earned international recognition, which highlights the growing reputation of Philippine-made chocolate for its quality and potential expansion in international markets.

Other challenges faced by the industry include high input costs, climate risks, pests and diseases, limited post-harvest facilities and a lack of domestic value-adding and processing capacity.

UA&P-CFA noted that despite being an exporter of cacao beans, the country remains a substantial importer of processed cocoa products, particularly cocoa powder and chocolate.

Cacao exports have generally improved from 2021 to 2025, with export value reaching $46.23 million with a total volume of 5,930 MT last year.

On the other hand, import value grew by 69.8 percent from 2021 to 2025, amounting to $2.14 million or 281 MT.

“The substantial gap between imports and exports of processed cocoa products points to strong domestic demand and suggests considerable room to expand local processing,” the report said.

It added that this presents an opportunity for the industry to lessen its reliance on imported cocoa products and capture more of the demand within the local cocoa value chain.