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February 14, 2025 | 12:00am
MANILA, Philippines — Chocolates and roses. It has always been chocolates and roses on Valentine’s Day. But unlike the song of The Green, Filipino lovers may have to resist a sweet bite of chocolate as the price of the beloved sweet continues to turn bitter.
The world was in for a roller-coaster ride last year after cacao prices skyrocketed to unprecedented levels following a steep decline in West African supplies that caused a global supply crunch for the commodity.
Extreme weather conditions like El Niño caused erratic rainfall patterns and higher and dry temperatures, making it conducive for pests and diseases to proliferate. This significantly slashed cacao yields in West Africa, which accounts for 70 percent of the world’s supply.
Global cocoa prices peaked at a record high of $12,646 per metric ton in the middle of December last year. That translates to roughly about P750 a kilo, almost equivalent to two kilos of pork belly.
In its November update, the International Cocoa Organization (ICCO) revised upward its global production estimate to 4.382 million metric tons from its previous projection of 4.332 million MT.
However, the increase remained insufficient to meet the projected global demand of 4.816 million MT, resulting in an estimated shortage of almost 480,000 MT.
On an annual basis, production in cocoa year 2023-2024, which ran from October 2023 to September 2024, was down by 13.1 percent, according to ICCO.
On average, cocoa prices in 2024 settled at $7.33 per kilo, more than double the $3.28 per kilo average quotation in 2023, according to the World Bank.
Last month, world cocoa prices averaged a record level of $10.75 per kilo, based on World Bank data.
For a country like the Philippines, which imports over $200 million worth of cocoa and cocoa-based products including chocolates annually, the global situation means one thing: everyone has to pay more.
Last year, the country had to pay $0.4 or about P35 more on average for every cocoa and cocoa-based product it imported.
The average unit price of cocoa and cocoa-based products last year stood at $4 per kilo compared to some $3.6 per kilo in 2023, based on preliminary Philippine Statistics Authority (PSA) trade figures.
Lucrezia Cogliati, a commodities analyst at BMI, a unit of Fitch Group, pointed out that chocolate prices are expected to continue rising this year, although to a lesser extent than cocoa futures.
To cope with the situation, chocolate manufacturers are expected to reduce the proportion of cocoa in their products and even decrease the sizes to mitigate the possible price spikes, Cogliati emphasized, while noting that cocoa is only one of the many ingredients in producing chocolate products.
Discussions in online fora like Reddit have been buzzing, with Filipino bakers helping each other in figuring out how to cope with the rising cocoa prices to keep their businesses afloat while maintaining a viable product line.
One thread in the subreddit BakingPhilippines discussed pastry products that can be baked without using cocoa powder or chocolate just to avoid the costly ingredient.
The import unit cost of cocoa powder last year surged by half to an average of $4.54 per kilo from $3 per kilo in 2023, based on PSA data.
Multiple small and medium-scale online Filipino bakeries and pastry shops on Facebook have announced a price increase of around P10 to P15 on their products beginning this month to reflect the rising costs of cocoa powder.
Some cafes in Metro Manila have also been forced to increase the prices of their drinks and pastry items that use cocoa by at least P5 to maintain profitability.
Meanwhile, some shelves of convenience stores have also been grappling with chocolate stock issues, with new supplies coming in later than expected.
However, Cogliati noted that the current elevated global cocoa prices would bring motivate Filipino farmers and private sector to boost their investments in the industry to hike domestic output.
“But we note that these trees take around five years to produce beans from when they are planted so this development would only have effect in the medium to long term,” Cogliati told The STAR via email.
Local cacao harvest last year rose slightly to 10,840 metric tons from 10,760 metric tons in 2023 but average farmgate price received by farmers expanded by almost 50 percent, based on Philippine Statistics Authority (PSA) data.
The average farmgate price of cacao last year stood at a record-level of P164.11 per kilo versus the P111.10 per kilo in 2023. In the fourth quarter of 2024 alone, the average farmgate price of cacao doubled to P241.28 per kilo from P117.45 per kilo in the same quarter of 2023, PSA data showed.
Agriculture Undersecretary for high value crops Cheryl Marie Natividad-Caballero said the government is implementing several interventions to help Filipino cacao farmers to take advantage of the rising cacao prices.
Some of the interventions involve expansion and rehabilitation of cocoa farms nationwide through provision of quality cacao seedlings and promotion of pruning and rehabilitation techniques to hike yields of existing farms, Caballero said.
The Department of Agriculture (DA) is also providing training and technical support including Good Agricultural Practices to improve productivity and quality of cacao beans produced locally, she added.
Caballero also noted that the government is keen on linking farmers with state financing programs to have better credit access as well as connecting cooperatives with local and international buyers to ensure better prices for their beans.
The DA is also encouraging domestic bean-to-bar processing to maximize profits from finished cacao products.
