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Higher chocolate prices? Why Ebola is to blame

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REUTERS/Thierry Gouegnon

(Read caption) A producer spreads cacao seeds for drying at Yaokoka, Ivory Coast, in 2005. Cacao prices are already rising over fears that the Ebola epidemic will mean that fewer workers will be able to harvest the latest crop.

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As the Ebola epidemic claims thousands of lives in West Africa, it is also threatening the price and production of one of the world’s most popular commodities: chocolate.

The three countries that produce almost 60 percent of the world’s cocoa production – Ivory Coast, Ghana, and Nigeria – neighbor the West African countries with the worst Ebola outbreaks, jeopardizing cacao harvests and chocolate supplies.

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The world’s largest producer of cacao, Ivory Coast, has closed its borders with Ebola-stricken neighbors Liberia and Guinea, shutting out many of the migrant workers needed to pick the cacao beans which go into popular chocolate candies such as Snickers Bars, Nestle Crunch, and M&Ms.

Ivory Coast produces about 1.6 million metric tons of cacao beans each year, or about 33 percent of the world’s total, according to the UN Food and Agriculture Organization. A strong harvest is expected this year, but due to closed borders, there may not be enough labor to pick the cacao beans typically harvested by migrant workers from neighboring countries Liberia and Guinea, Politico reports

Ebola has devastated parts of West Africa since the outbreak began in December 2013. More than 8,000 people there have been diagnosed with Ebola, and some 4,000 have died in Liberia, Guinea, and Sierra Leone, the worst hit countries. 

On Sept. 20, Ebola reached American shores with Thomas Eric Duncan, a patient diagnosed with the illness who entered the US aboard a flight from Liberia. Duncan died on Oct. 8. A healthcare worker who treated Duncan in a Dallas hospital has now been diagnosed with the virus, making her the second confirmed case of Ebola in the US. Though it shares borders with two of the most Ebola-affected countries in Africa, there are no confirmed cases of Ebola in Ivory Coast, but the virus may yet have a major impact on chocolate supplies and prices worldwide.

Fear that the virus will affect cacao supplies has already translated into market jitters, with prices on cocoa futures vaulting from a normal trading range of $2,000 to $2,700 per ton to as high as $3,400 in September.

Major chocolate makers like Hershey, Mars, Nestle, and Callebaut have launched education and fundraising initiatives to prevent the spread of the virus among cacao workers. A Callebaut education truck has been winding through rural Ivory Coast to educate farmers on the best ways to avoid contracting Ebola, such as frequent hand washing, avoiding “bush meat,” not handling corpses, and limiting person-to-person contact.

But even if chocolate makers succeed in keeping Ebola out of cacao producing nations, consumers may soon see a jump in chocolate prices.
"If prices rise at a greater rate, chocolate manufacturers will pass the increase onto consumers," Andrew Rolle, a director at Juremont, a major Australian importer of chocolate ingredients, told the Sydney Morning Herald. "It's a fragile market there at the best of times. There will be labor issues with the cocoa farmers in the fields, political issues, transport issues with accessing stock through ports."

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Another possibility: Chocolate bars may be bulked up with cheaper ingredients like sugar, raisins, and other fillers, to keep prices down. 

But Ebola’s affect on chocolate production may be a harbinger of a bigger problem, a UN FAO official tells Politico: the virus’s impact on all West Africa agriculture. Already, entire farming operations have been shut down in some areas and if it continues, could lead a larger food crisis in West Africa.