What is causing this situation?
Major cacao producing countries like Ivory Coast and Ghana have been experiencing their worst harvests in years due to adverse weather conditions and cacao tree disease. This has led to massive decrease in the availability of cacao beans, leading to the rise in cacao prices. Additionally, other significant cacao-producing countries such as Indonesia, Nigeria, Cameroon, Ecuador, and Brazil are also facing challenges impacting cacao quality over the past few years.
In Indonesia, particularly over the past three years, the effects on El Niño weather patterns have had a major impact. Crop failures have occurred in many regions, resulting in a 50% decline in cacao production nationwide.
High prices and increasing industrial demand for low-quality cacao have also reduced incentives for farmers to produce the high-quality fermented cacao beans that we need, making the situation even more difficult.
Unfortunately, this cocoa pricing crisis shows no signs of being temporary. While weather conditions as well as large scale market speculation and manipulation have contributed to the recent surge, more deep-rooted issues like climate change and chronic underinvenstment in cacao farming are severely restricting supply. These systemic problems contributing to the production squeeze won’t be resolved by a change in seasons alone. Addressing the fundamental challenges plaguing global cacao cultivation is crucial to alleviating these pricing pressures long-term.
How we are actively working to improve conditions
- Ubud Raw has played a significant role in establishing the newly formed Association of Indonesian Bean to Bar Chocolate (ACBI). This has enabled us to collectively communicate directly with government ministries, who are motivated to increase the production of high-quality fermented cacao in Indonesia, as well as to promote Indonesian craft chocolate internationally.
- Ubud Raw is also collaborating with other chocolate makers to plant cacao trees and create our own farms in Bali and on other islands. This project is still in its initial stages and the young trees will take at least 5 years to bear fruit.
- We have hired an expert in cacao cultivation and fermentation, whose role is to source cacao and train farmers to increase the quality of their cacao beans.