/ 3 April 2024

Climate crisis: Huge blow to cocoa producers

Mota Mota High Res Image
Nestlé’s Communication Executive Mota Mota.

Chocolate prices set to soar as climate change affects Nestlé’s production

Chocolate-producing companies and consumers bear the brunt of climate change as cocoa farmers continue to increase prices caused by damaged cocoa beans, as a result of frequent extreme weather events including heatwaves and erratic rains.

In an interview with the Mail & Guardian, Nestlé’s Communication Executive Mota Mota said the rainfall, increasing heat waves and strong winds in West Africa have pressured the company (Nestlé) to implement sustainable practices and support resilience initiatives in their supply chains.

“Because of the extreme weather, there has been a delay in harvest, and supply shortages and the soaring cocoa prices are impacting both the chocolate manufacturers like ourselves [and] our customers — but also, more importantly, it’s impacting the cocoa farming families worldwide,” Mota said.

Cocoa, an essential ingredient for chocolate, comes from the seeds of the cacao tree. Nestlé owns over 2 000 brands reliant on cocoa for chocolate production.

Mota’s comments come after farmers in Côte d’Ivoire — the world’s largest cocoa producer, accounting for about 44% of global cocoa production — announced that their cacao trees were rotting and were producing less than the previous year.

Cocoa cultivation relies on a delicate balance of rainfall and sunshine. But in West Africa, encompassing countries such as Côte d’Ivoire, Ghana, Nigeria and Cameroon — major cocoa producers contributing approximately 70% of global supply — conditions for growth have been unfavourable.

From 1 October to 10 March 2024, cocoa exports from the Ivory Coast declined by 29% compared to the previous year. According to Trading Economics, the Ivory Coast cocoa regulator anticipates a 33% decrease in the April harvest, dropping from 600 000 metric tonnes to 400 000 metric tonnes.

According to the indicators released on Tuesday, the price of cocoa reached a new peak in March 2024, standing at approximately $8 500 per metric tonne. 

This marks a significant rise from the previous month’s figure of around $6 030 per metric tonne. Overall, cocoa prices have surged by 98.36% since the start of 2024.

Speaking at a sustainable conference on Tuesday, Nestlé’s Business Executive Officer in the east and southern Africa region Zumi Njongwe said with cocoa prices hitting record highs, chocolate manufacturers are facing significant cost pressures, which will result in price increases as the company attempts to offset other input costs. 

Mota said the effects of climate change on cocoa production are a growing concern for  Nestlé, as cocoa is a vital ingredient for their products — and the main source of livelihood for many farmers in West Africa.

He said the challenges posed by climate change reflect a broader trend within the industry to address sustainability issues in their supply chains. 

Amid the challenges posed by climate change on cocoa production, Nestlé has responded with proactive measures to address the growing concerns. These initiatives aim to mitigate the adverse effects of climate change while ensuring the sustainability of cocoa production and the livelihoods of farmers in West Africa, Mota said.

He added that continued collaboration between chocolate-producing companies, cocoa farmers, governments and other stakeholders will be essential to develop and implement effective strategies to adapt to the changing climate and ensure the sustainability of cocoa production in the future.

Mota emphasised the importance of investing in sustainable agricultural processes and practices that could modernise agricultural infrastructure and promote public-private partnerships. This will ensure that food security and sustainable growth remain the main priorities, he said.

Mota said Nestlé was taking steps towards cleaner energy in its production and was updating the company’s plastic range to be environmentally friendly in its quest to reach net-zero by 2050.