Published By : 05 Feb 2016 | Published By : QYRESEARCH
Demand for chocolate is rapidly increasing with growing consumer base across China and India. But cocoa production is slowing down, especially in countries such as Ghana. Ghana is the second-largest cocoa producing nation that witnessed a steep decline in the production of cocoa last year. Since the start of 2012, prices of cocoa have increased by 40%. This can be attributed to the low production of cocoa due to poor farming practices across Ivory Coast and Ghana, the top two largest cocoa-producing nations. To fight the low production of cocoa, chocolate manufacturing companies are taking initiatives to improve sustainability, thereby boosting cocoa output.
Chocolate Manufacturers Helping Cocoa Farmers in Ghana and Ivory Cost
Mondelez International Inc., the manufacturer of Oreo cookies and Cadbury Dairy Milk bars, is helping cocoa farmers in Ghana by advising them about good farm practices to boost their dwindling crop yields. Similar instructions to farmers in neighboring Ivory Coast, the world’s No. 1 cocoa grower, have helped produce back-to-back record crops. But average crop yields are just one-third as big as they could be if all cocoa farmers in Ghana and Ivory Coast followed good agricultural practices. Many experts project production in these two countries, which grow about 60% of world’s cocoa, to drop in the current season, affected by problems such as the old age of many cocoa trees, bad weather and disease.
Cocoa Ranks High in Commodity Index
Last year, prices of cocoa increased by 10%. In the S&P GSCI commodity index, it was the best performing commodity. While prices lowered at the start of this year, the long-term surge has led companies such as Nestlé SA and Hershey to increase price of chocolate since the start of 2014.