Chart: Surging cocoa prices and expensive Easter eggs

A report last month by Which? found that the price of the seasonal chocolate treat has been soaring this year, way ahead of inflation.

Some products have gone up in price by as much as 50%, with plenty of shrinkflation (the practice of cutting the size of products while keeping the price the same). The consumer magazine reported the cost of a Twix white chocolate egg increased from £5 to £6, despite being 58g smaller.

One of the factors at play here is the price of cocoa, which has seen a growth trajectory not too dissimilar to that of bitcoin or, as others have pointed out, AI chip manufacturer Nvidia’s share price. Cocoa prices started rapidly increasing in late 2023 and, despite a lot of volatility, have been way above historical standards ever since.

Prices peaked in January at $10,710 (£8,107) per metric tonne, according to data from the International Monetary Fund. This meant cocoa at that point was 382% more expensive than in September 2022.

This coincided with a big rise in cocoa and confectionery wholesale prices for retailers, albeit not quite as extreme as the price of cocoa itself. The Office for National Statistics’ Producer price inflation output series, which measures wholesale prices, went up by 36% between January 2022 and January 2025.

In terms of what this means for confectionery aisle prices, we need to look at the separate Consumer Prices Index (CPI) dataset. This shows chocolate products went on a similar trajectory to the wholesale prices, with price rises even more steep for cocoa and powdered chocolate.

What has caused this price explosion? Broadly, supply chain problems in West Africa. More specifically extreme weather, crop disease and some farmers turning their land over to illegal gold miners.

This supply chain shortage presented an opportunity for investors, who upped trading in cocoa futures, which are financial instruments you can sell or buy that help determine the trading price of cocoa beans. Future exchanges exist for many different types of commodities.

Reuters reported last year on how hedge funds trying to get out of the cocoa futures market impacted liquidity and drove the price up even further.

Hershey’s vice president for procurement also told the news agency last month that the cocoa futures market had become disconnected from the reality on the ground.

Many readers will be worried to note that a similar trend is happening with coffee. Lavazza chief executive Antonio Baravalle said to the Financial Times newspaper last weekend that speculation over prices was in part to blame for coffee price increases, saying that three or four pounds for espressos in London was what he sees as “the limit”.

One remedy that chocolate makers have looked at is reducing cocoa content or looking for alternatives to use. This has of course been going on for years. In 2013, the BBC reported that Cadbury’s Dairy Milk had a minimum of 26% cocoa solids, but now the minimum is 20%.

Things might be changing. Close observers will see a big drop in the cocoa prices chart for March. That followed a new supply forecast from the International Cocoa Organization (ICCO) that predicted a small surplus in cocoa production this year. ICCO estimated an 8% growth in output to reach 4.84mt.

ING economists have also suggested that higher prices could help achieve “demand destruction” by turning consumers off cocoa. There is some sign of this already. Data they aggregated from different cocoa associations showed that grindings—a measure of consumer demand—in Europe, North America and Asia were down by 3.2% year on year.

Retailers meanwhile will be hoping that any demand destruction is held off until after the Easter Weekend. Besides the chocolate prices, the outlook for a good Easter looks strong. Retail sales outpaced economist expectations in January and February and the BRC/KPMG data for March showed sales still trended upwards by 1.1% for the month year-on-year, despite Easter moving into the April numbers for 2025.

It would be negligent of me to leave you without quickly answering the following question: What does this mean for the price of a Freddo? If the bars had kept in line with inflation since 1999, they would be 19p. Well, retailers are in something of a price war on the miniature chocolate bar, with Tesco and Morrisons selling one for 30p, Asda for 36p and Sainsbury’s for 40p. It remains to be seen if that moves the dial for Easter.