The $11 chocolate bar?

A tough growing environment in Africa has led some cocoa farmers to drop their crops -- spurring predictions of a world shortage.

By Kim Peterson Nov 10, 2010 1:16PM
Chocolate © image100/CorbisTime to start hoarding Hershey's (HSY)? Some experts in the cocoa industry say that the world could run out of affordable chocolate within 20 years, according to The Independent.

Cocoa is headed for a shortage, they say, and eventually a single chocolate bar could cost $11 on average. The price of cocoa has already shot to an all-time high lately.

"In 20 years chocolate will be like caviar," said a conservation researcher in Ghana, a hot spot for cocoa production. "It will become so rare and so expensive that the average Joe just won't be able to afford it."

The problem is that it's becoming too difficult to farm cocoa in traditional fields in Africa. The soil is depleted of nutrients, one expert says, and a labor shortage is hurting production. That's affecting cocoa crops on the continent, although cocoa can still be grown in South America, the Caribbean and Asia.

In places like Ghana, the Independent reports, young farmers are abandoning cocoa for the more profitable rubber plant. It doesn't help that cocoa plants are getting hit with diseases.

Chocolate would never disappear altogether. But it may become an expensive treat that fewer people can afford. Cheaper alternatives such as carob could fill the void. Post continues after video:
One recent study showed that the chocolate market is only growing in the premium, high-end sector. And fans will continue to get their chocolate fix, but at higher prices.

"Fine chocolate, like fine wine, will cost considerably more, as cocoa farmers stop leaving the land in search of better-paid jobs in the cities," the chair of the UK Academy of Chocolate told the Independent. "The result will be more careful cultivation of the crops, and a greater supply of fine cocoas."

The pressure is now on Cadbury, which is owned by Kraft (KFT), and Nestlé (NSRGF) to plant sustainable cocoa farms and give workers incentive to stay. Hershey also has a considerable interest as well -- although the company has started replacing the cocoa butter in its chocolate bars with vegetable oil.

The big winner in all this is Anthony Ward, the London hedge fund manager who has bought up so much cocoa that he has all but cornered the market this year. Some say Ward now owns the equivalent of 5 billion chocolate bars.

More from MSN Top Stocks:
One man's cocoa binge



19Comments
Nov 10, 2010 4:10PM
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401k in the toilet, laid off, can't find work, and now you tell me NO CHOCOLATE!!!
Nov 10, 2010 8:19PM
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The writer of this article is an idiot who never read an economics book in her life. Long before chocolate hits $11/bar chocolate would be so profitible that production would soar.
Nov 10, 2010 10:13PM
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This story must be written by that Hedge fund owner's employee.   If a candy bar ever gets close to $11 those African's will be tripping over themselves to plant the stuff.  This hedgie, like many hedgies, is spreading rumors, lies and innuendo  to make money in his position.  Kind of like George Soros constantly does.
Nov 10, 2010 4:21PM
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Is it just me or does all this seem a bit engineered. Cornering the chocolate market really?? I`d rather put my money on a three legged rocking horse then take that bet. Hell in 20 yrs who knows what kind of break throughs might develop let alone what the market and the world economy might look like. I doubt Hershey will allow 12$ candy bars to be the norm, which would practicaly ruin them.
Nov 10, 2010 4:59PM
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Well, maybe climate change will help.  If the overall climate alters (and it is considerably hotter in the area of Texas, Oklahoma, and Kansas these days) maybe the US will start to be more like Africa as Africa turns into a big desert.  We could try growing it here.  Though, of course, since Canada is warming up--maybe one can grow it there or even Alaska.

 

Then again, Mexico is where it came from originally--if Mexico grows a lot of cocoa, maybe their economy will take off and all the Mexicans will go home.  Profitable cash crops don't disappear--they just will be grown somewhere else.  Or they will be genetically engineered to grow in another climate. This is a load of hooey.

Nov 10, 2010 5:32PM
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In 20 years there's gonna be a lot of real cranky women in the world!
Nov 10, 2010 5:47PM
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Here's an idea: start buying Fair Trade chocolate. Companies that sell fair trade chocolate pay farmers a decent wage, don't use child labor, and ensure that farmers practice sustainable farming.


Nov 10, 2010 4:24PM
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No chocolate, but carob?... I'll throw away my chocolate cookbooks first.
Nov 13, 2010 1:15AM
Nov 10, 2010 7:11PM
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1st thing,back in the day,my dad used to impress his coworkers at the plating plant he worked at by serving caviar at get togethers...you can get enough caviar for a party for under $5,so it isnt THAt expensive....today,i can buy an $11 chocolate bar...this article is assinine...im sure,in doing their research,they saw that the avg choco bar goes for .99 cents,yet i can get that same choco bar for 4 for a buck or better....the point is,there will always be expensive and cheap chocolate,and,with choco companies being some of the food industries golden children,i dont see chocolate being put out of the reach of the common person,ever
Nov 10, 2010 5:59PM
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I used to buy a Chunky as a kid, wife says I now look like one! I wish they were still a nickel.
Nov 10, 2010 5:58PM
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I enjoy chocolate immensely. That said, I wouldn't pay $11 for a bar of it on a regular basis. Maybe only on special occasions. So, what if becomes scarce? There are other things to enjoy in life.
Nov 10, 2010 5:43PM
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5 billion chocolate bars?  That is way to much chocolate for one person.  Wink   

Anyway... what else is new. everything is going up in price, it probably isn't worth worrying about something that is going to happen in 20 years, if it happens.  Have a good day everyone!!!

Nov 10, 2010 5:40PM
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Although I love chocolate, I am glad this is happening. Maybe now they won't rely on child slavery to harvest the chocolate that companies, like Nestle and Kraft, so maliciously force them to harvest for little to no pay.

 

If you don't believe me then look it up.

 

Here are a few links to open up your mind:

slavefreechocolate.org

or

wikipedia.com search - "children in cocoa production"

or

xocoalt.org

 

Nov 10, 2010 4:31PM
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ask me if I care.  just another way to get us all worked up.
Nov 10, 2010 4:26PM
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Time for someone to create Mocklate.

I kinda wanna try fi****ashios too.


Nov 10, 2010 4:24PM
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Just like any other commodity, when the price goes up so does production. Someone will certainly fill the gap. Stories like this treat us like morons.
Nov 10, 2010 4:36PM
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And I just started crying, but then again I would pay anything for chocolate.  I am a chocoholic and I am proud of that :)
Nov 10, 2010 4:32PM
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hell   with our economy it could reach 10 dollars next year    obame and crew keep printing money
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