Cacao Surplus and Price Decline

How large is the current demand for cacao products? I never know exact number nor estimate. What I know is, it is so huge and our current production is so low to cope with. The government included it in national budget few years ago.

The campaign became massive. Related government agencies began purchasing seedlings in huge volumes. Then cacao farmers expanded their nurseries to sell young plants. The fresh wet seed is so valuable that they opt to sell it as is or grow as seedlings.

We felt the lack of supply too. There was several price increase in short time span last year. We experienced two months no production. Our regular supplier warehouse was emptied because of too many customers needing the beans. The demand is really large. Numerous nurseries are also competing with manufacturers. The situation happened despite of our two months precaution.

What is this? A recent article dated April 22, 2017.

According to write up, Ivory Coast and Ghana, the two largest cacao producing countries have surplus of 300,000 tons cocoa between year 2016 and 2017.

We are all aware of what happens when there is surplus. The price goes down. Very true, cocoa price went down from $3,300 per metric to to about $2,000. That was huge!.

Further, this surplus, lower cacao prices and decline of chocolate consumption has greatly impacted the cocoa economic of Ecuador.

I couldn’t believe what I read. We are reviving our very own cacao industry to fill the local and international demands. We might not able to sell it when that time comes. I hope this is not the case.

Resource: foodensity

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