Cocoa’s shortage this season will be bigger than previously expected as consumption holds up despite higher prices, according to the International Cocoa Organization.

Demand will exceed production by 439,000 tons, driven by higher cocoa grinding in consuming countries, the ICCO said in its second estimate for the current October-September year. That compares with a Februaryprojection for a deficit of 374,000 tons.

“Current available data reveal that cocoa grinding activities have so far been unrelenting in importing countries despite the record cocoa price rallies,” the ICCO said.

“As the 2023-24 season progresses, it is certain the season will end in a higher deficit than previously expected.”

Futures surged to a record of more than $11,000 a ton in New York in April as poor harvests in West Africa curbed supplies, stressing buyers and making chocolate more expensive. Still, prices have eased back below $10,000, and some analysts have said the rally has peaked.

The ICCO raised its estimate for global grindings to 4.86 million tons, from its initial outlook of 4.78 million tons. It raised its production projection by 12,000 tons to 4.46 million tons.

Bloomberg