The chocolate industry is on a rocky road with the soaring price of cocoa and sugar set to make sweet treats more expensive.
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Producers across the world are beset with rising prices from poor growing conditions in West Africa and constrained labor and transport costs.
Retail prices for chocolate have been climbing in recent months with the price of cocoa increasing by 27 per cent in the past year, according to Rabobank.
"The major production regions, particularly in Ivory Coast which accounts for more than 40 per cent of global cocoa production have had very wet conditions and flooding which has been causing rotting and disease in the trees," RaboResearch associate analyst Pia Piggott said.
She forecast cocoa prices to stay at elevated levels well into 2024.
Not so sweet
Sugar prices are also adding pressure to the chocolate industry with prices at the highest point in a decade.
Canberra-based artisanal chocolate producer Jasper and Myrtle source their beans from Papua New Guinea but are feeling the pressure on the global industry.
"We have definitely noticed increased prices across the board, not just cocoa and sugar, but mainly driven by increase in prices of transport and increased prices of labour," owner Li Peng Monroe said.
She said they would have to consider increasing their prices in the near future.
Food retail analyst Michael Harvey said the situation might result in consumers cutting back on chocolate treats.
"Because there is belt tightening going on and there's going to be reduced spending on discretionary products, that might mean a little less chocolate on the go and less impulse purchasing out and about," he said.
Nestle Australia said it was working hard to keep prices as low as possible in the face of inflationary pressures but prices were ultimately at the discretion of the retailer.
Home grown hip-pocket
Domestic cocoa production is limited and the Australian industry is still in its infancy,
Far north Queensland-based producer and owner of Charley's Chocolate Chris Jahnke said Australian-grown chocolate was a high-end product.
"It has to be understood that because of the inherently high labor costs here, Australian cocoa will always be a premium product.
"Labor costs in West Africa are in the order of about 30 or so dollars a month. In Australia, we're dealing with labor costs of 30 or so dollars an hour," he said.
Chocolate made up 70 per cent of the $6.3 billion Australian confectionary market in 2021. Australia is a net importer of cocoa and cocoa preparations, importing a net value of $699.3 million in 2020, according to AgriFutures.
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Melbourne-based chocolate maker Monsieur Truffle also said quality ingredients and sustainability attracted a higher price tag.
"A lot of small businesses are having a really tough time right now," a spokesperson for the business said.
"When the manufacturer is a boutique handmade place and already has a higher cost of operation, sometimes the business needs to absorb these costs to be able to keep selling their products."
