Cocoa Chaos: Price Swings Hit Farmers Hard

Cocoa prices experienced a dramatic surge, quadrupling to $12,000 a tonne by the end of 2024, only to fall back to pre-hike levels. This intense market volatility has left millions of smallholder farmers in distress, with manufacturers reducing chocolate bar sizes and consumers buying less. The global cocoa supply chain is under pressure from climate change, pests, and illegal mining, which impact crop yields and farmland.

A new UK coalition, including major chocolate companies and NGOs, is pushing for the implementation of the UK Forest Risk Commodities Regulation. This legislation aims to ensure that commodities imported into the UK are not linked to illegal deforestation. The coalition emphasizes shared responsibility across the supply chain to support farmers and avoid compliance costs falling solely on them.

Advocates highlight the urgent need for mandatory due diligence legislation to create a level playing field and mobilize the entire value chain. Aligning UK regulations with the EU Deforestation Regulation is also a key objective to minimize trade barriers and prevent the UK from becoming a destination for illegally sourced cocoa. Investment in farm-level traceability and farmer support is seen as crucial for building resilient supply chains.