This Easter, the surge in cocoa prices continues to impact the cost of chocolate, prompting consumers to hunt for deals to fill their baskets. The rise in cocoa prices over the past few years has been attributed to adverse conditions affecting crops in key cocoa-producing regions, particularly extreme weather events.
Cocoa prices on financial markets peaked at above US$12,000 per ton in 2024. Recently, they have stabilized around US$8,000 per ton, significantly increasing from the US$2,000 levels seen in 2022, as reported by Refinitiv. For chocolate manufacturers, raising product prices has become a necessity to maintain the quality that customers expect.
“When your price of chocolate triples … you cannot keep the same price. It’s impossible,” stated Daniel Poncelet, owner of Vancouver-based Daniel Chocolates. He notes that his chocolate Easter bunny has doubled in price over the past few years. According to Statistics Canada, prices of confectionery products rose by 5.7 percent year-over-year in March, outpacing overall inflation.
The challenges posed by climate change significantly hinder cocoa farmers, as their harvests are affected by varying heat and rainfall patterns. Some farmers are resorting to alternative crops, which is further driving up cocoa prices. Although confectionery manufacturers experienced some relief in sugar prices in 2024, Farm Credit Canada’s 2025 Food and Beverage Report indicates minimal relief is anticipated for cocoa prices in 2025.
If cocoa prices remain high and trade disruptions continue, profit margins in the sector will tighten further. Jo-Ann McArthur, president of Nourish Food Marketing, explained that companies have limited options for absorbing such notable cost increases. Beyond raising prices, some businesses are adjusting product sizes, reducing cocoa solids in favor of cocoa butter, or promoting their products as premium offerings.
Smaller businesses face greater challenges in managing price hikes, and even major chocolate manufacturers are not immune. Mondelez International, known for making Cadbury and other popular brands, has predicted a decline in its adjusted earnings per share for 2025 due to “unprecedented cocoa inflation,” as revealed in their fourth-quarter results from February.
Poncelet remarked that while customers are generally understanding of the price increases, he has noticed a shift in buying behavior, with consumers opting for smaller quantities. “People are not going to buy a dozen bunnies. They’re going to buy maybe one for each kid, and that’s it,” he explained. This behavioral shift has been accentuated by inflation, as shoppers increasingly turn to discount stores, search for sales, and switch to more affordable private-label brands.
However, when it comes to special occasions such as Easter, consumer behavior tends to differ. Budget-conscious parents may still invest in Easter chocolates but might adopt a “high-low” strategy, splurging on certain items while saving on others. Joel Gregoire, associate director for food and drink at Mintel, emphasizes that the purchase is often associated with creating memories, thereby elevating the perceived value of the items.
McArthur echoed this sentiment, noting that consumers are willing to spend on special occasions but are now more likely to seek out price-sensitive retailers. She recently spotted a display of Lindt chocolate in a dollar store, illustrating a blend of saving and splurging. Retailers and manufacturers are expected to offer consumers a wider range of choices to alleviate the impact of rising prices, which may include “tiering” strategies—providing both high-quality and more affordable options.
There’s also potential for store-owned brands to gain traction, given their lower price points. Companies might consider options like shrinkflation—reducing product sizes—or offering various sizes of the same product. Poncelet remains hopeful for a stabilization in cocoa prices, noting that while prices remain high, they have decreased significantly from the previous year’s peak. He mentioned that he has secured contracts for the third and fourth quarters at more favorable prices, which may allow him to reduce prices starting in July.
In a positive development, McArthur does not foresee tariffs affecting chocolate prices this Easter. She pointed out that the impact of tariffs on retail prices experiences delays in the supply chain, and many manufacturers have been stockpiling ingredients for some time. Recently, the government announced a temporary reprieve on retaliatory tariffs for ingredients used by Canadian food manufacturers, which may further stabilize prices.
