By Aimee Look and Joe Stonor
After more than two years of chaos in cocoa markets, chocolatiers are growing hungry for alternatives--with the strain falling on raw producers.
The commodity's price has swung widely, lurching from highs of around $12,000 a metric ton in December 2024 after disease and dry weather dented production, to lows of under $2,900 a metric ton in February this year.
Cocoa demand hasn't recovered much since the spike. Data released Thursday showed a 7.8% on-year fall in European cocoa demand and a 3.8% drop in North American demand in the first quarter, even as the commodity price tumbled to new depths.
For Barry Callebaut, one of the largest refiners of raw cocoa globally and a seller of confectionery chocolate, recent downbeat cocoa prices helped prompt a profit warning. The chocolate maker's cocoa sales volumes fell 14.3% on year for the half-year ending Feb. 28, while global chocolate sales volumes declined 5.1%.
On Thursday, Callebaut said recurring operating profit for the fiscal year, which ends in August, would decline by a mid-teens percentage range. The company previously expected an increase.
Over the past few years, higher prices have pushed chocolatiers to seek alternatives, including reformulating recipes to fill chocolate with ingredients other than cocoa, creating alternatives or developing cocoa in a lab.
Global packaged foods giant Nestle rejigged its Toffee Crisp range and Blue Riband recipes in the U.K. so much that the products no longer could be called 'chocolate' at the end of last year. Missing the 20% minimum threshold for cocoa solids in a bar, Nestle had to change the labeling, according to a spokesperson.
The Swiss company is also making chocolate-like products without cocoa at all. Through a partnership with sustainability brand ChoViva--owned by Germany's Planet A Foods--it created a product formulated from fermented and roasted sunflower seeds and oats. Meanwhile, a Mondelez-backed Israeli start-up, Celleste Bio, said this week that it produced chocolate bars from cells grown in a lab.
In February, Reese's owner Hershey came under fire from Brad Reese--grandson of creator H.B. Reese--when he said the company changed some recipes. Hershey said in response that it adjusts its formulations for new shapes and other innovations, but keeps the original peanut butter cup recipe.
The U.S. candy maker said at a recent investor day that it would ensure its offerings are consistent with the brand's classic milk and dark chocolate recipes for Reese's and Hershey products, after facing social-media backlash for changing recipes in the past. Meanwhile, Hershey is amending the recipe for KitKats--which it distributes in the U.S.--Chief Growth Officer Stacy Taffet said.
Some reformulations have received significant attention in media and online, Rabobank cocoa analyst Oran van Dort said.
"But what we hear from companies is that, though there was backlash on social media, people aren't giving backlash with their wallets."
As a result, some chocolatiers are in no rush to add more cocoa back into products. Some still have large piles of cocoa to work through before returning to the market, van Dort said.
Timing the erratic cocoa market made amassing those stockpiles expensive, demonstrating the perils of building a business around a livewire commodity. Earnings results suggest some chocolatiers are facing heavy losses if cocoa prices don't recover.
Hershey recorded mark-to-market losses on its commodities trading of $423 million in 2025--a loss of $2.08 a share if realized, according to its 10-K filed earlier this year. Mondelez fared worse over the period, the company's results suggest, facing a mark-to-market pre-tax loss of $984 million on its commodities contracts.
Cocoa has burned chocolatiers before. Demand will likely increase as stores deplete, but the appetite for cocoa may wane if substitutes or lab-grown beans gain traction.
Write to Aimee Look at aimee.look@wsj.com and Joe Stonor at josephmichael.stonor@wsj.com
(END) Dow Jones Newswires
April 17, 2026 07:11 ET (11:11 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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