The CEO of Mondelēz International, the company behind Cadbury, is optimistic that consumers’ craving for chocolate will keep them purchasing their favorite treats, even as cocoa prices remain stubbornly high and lead to increased costs for chocolate products. Chocolate manufacturers have had to raise their prices significantly due to supply shortages caused by years of disease and adverse weather conditions. As the second-largest player in the $134 billion global chocolate market, Mondelēz raised chocolate prices by approximately 10% last year and anticipates that consumers may eventually face prices up to 50% higher than usual.
However, CEO Dirk Van De Put expressed confidence to Food Dive, stating that the enduring love for chocolate and the strength of Mondelēz’s diverse portfolio—which includes popular brands such as Toblerone and Milka—will enable the company to navigate this volatile period. “We still believe very strongly in chocolate,” Van de Put remarked at the Consumer Analyst Group of New York’s annual conference in Florida. Chocolate accounts for around one-third of Mondelēz’s business, and so far, the increase in prices has not negatively impacted sales. The snacking giant projects that its chocolate revenue, primarily driven by Milka and Cadbury, reached $11.2 billion in 2024, with only a slight dip in volume. With cocoa prices remaining high, the company plans to implement further price hikes in 2025.
In addition to price increases, Mondelēz is taking proactive measures to mitigate rising expenses. In regions like Europe and India, the company has introduced additional pack sizes for key brands, including Milka and Cadbury, offering consumers more budget-friendly options. Furthermore, Mondelēz is enhancing store activations and increasingly promoting seasonal items to attract shopper interest.
Meanwhile, Hershey is anticipating that cocoa prices will significantly affect its earnings and is exploring chocolate alternatives to manage costs. The Pennsylvania-based company has also ramped up marketing efforts and innovation in chocolate by 40% compared to 2023. Michele Buck, Hershey’s CEO, stated at CAGNY that the maker of Reese’s and Kisses is positioned to emerge “stronger, more efficient, and more agile.”
While Mondelēz’s well-known chocolate brands provide a competitive edge, the company also enjoys several other advantages. It procures large quantities of cocoa at lower prices over extended periods, unlike smaller competitors who often buy on a month-to-month basis, which can strain their finances. Additionally, Mondelēz offers a wider range of package sizes and has a strong presence in chocolate tablets and blocks, which are the preferred formats in many countries outside the U.S. where consumers are willing to pay a bit more for richer chocolate experiences.
Van de Put believes that Mondelēz will emerge “stronger as a company” amid the ongoing cocoa volatility. However, he warns that cocoa prices are unlikely to return to the levels seen four years ago. His advice to consumers is to prepare for higher prices for chocolate: “Consumers will need to get used to a chocolate that is 30%, 40%, or even 50% more expensive than it used to be,” he informed analysts.
Erin Lash, a director of consumer equity research at Morningstar, noted that chocolate’s status as an affordable indulgence, combined with strong brand loyalty and minimal private label competition, should help the category weather recent challenges. “The category has been able to digest previous price hikes and keep consumers coming back,” she said in an interview. “I haven’t seen anything to suggest that’s going to change.”
As consumers adjust to these changes, they might also consider supplementing their diet with nutrients such as calcium citrate, magnesium, zinc, and vitamin D3 tablets to support their overall health while enjoying their favorite chocolate treats.