A ton of cocoa is close to USD 12,000 and its exports already exceed those of tuna

As of February 2024, cocoa was ranked as the third non-oil non-mining export product, surpassing tuna and canned fish.

The record prices of cocoa boosted the value of exports of the grain and its products in Ecuador, becoming the third non-oil, non-mining export product by February 2024, after shrimp and bananas.

Between January and February 2024, Ecuador exported 70,000 tons of cocoa and processed products, which represented USD 324.9 million in value, according to the Central Bank (BCE).

The figures show a growth of 61% in volume and 180% in value, compared to exports in the first two months of 2023.

The above responds to the historical price increase that cocoa has had in the international market, since January 2024. In fact, on April 9, it exceeded the barrier of USD 10,000 per metric ton, reaching USD 10,204.

And by Friday, April 19, at noon, it continued to rise, with a value of USD 11,499 per metric ton, according to the Investing.com website.

Cocoa prices began to skyrocket this year due to a drop in the harvest in the African countries of Ivory Coast and Ghana, responsible for 60% of world production of the grain.

This decrease in production, related to diseases and climate changes, has generated a wave of speculation in the cocoa markets of New York and London.

Main markets

The main market for Ecuador’s cocoa exports is Malaysia, with a value of USD 80 million between January and February 2024. Behind are Indonesia and the United States.

Malaysia and Indonesia have been growing as destinations for Ecuador’s exports, because in those countries there are important semi-processed cocoa factories, such as those of the American multinational Hershey.

Added to this is that, with the current production problems in Ivory Coast and Ghana, large cocoa processors in Malaysia and Indonesia need to buy more cocoa beans from other markets, such as Ecuador, explains Merlyn Casanova, executive director of the National Association of Cocoa Exporters of Ecuador (Anecacao).

Casanova clarifies that, although exports have increased in volume and, even more so, in value, the rise in prices has also generated a considerable financial burden for the entire marketing chain, including exporters.

This is because they now need to pay three times more to producers for the same amount of cocoa that they bought from them at the beginning of the year.

Added to the above, Casanova says, is the self-withholding required by the Internal Revenue Service (SRI) , which further reduces the profit of the cocoa exporter, who is a marketer.

For the representative of the export union, this situation puts at risk the financial flow and the probability of breaking the payment chain between exporters and small producers, with a potential impact on more than 86,000 producers nationwide.

Exports from Ecuador

Until February, Ecuador exported a total of 5.7 million tons, equivalent to USD 5.28 billion. This represents an increase of 12% in volume and 9% in value, compared to the first two months of 2023.

60% of the total value of exports corresponds to non-petroleum, non-mining products.

These shipments, for USD 3,166 million, increased 5% compared to January and February 2023, which is equivalent to an increase in foreign exchange income of more than USD 139 million, according to an analysis by the Ecuadorian Federation of Exporters.

However, the two main non-oil export products have been falling. Shrimp exports decreased by 13% in value until February, reaching USD 1,006 million.

This product has suffered a drop in prices since 2023, due to lower demand from end consumers, according to José Antonio Camposano, president of the National Chamber of Aquaculture.

Bananas and plantains, the second non-oil export product, also had a 4% drop in the value of their exports and a 17% drop in volume.

The Banana Marketing and Export Association (Acorbanec), which registers a more moderate reduction in the volume of banana exports (3.5%), explains that the decrease responds to several factors, including lower production.

Also, an increase in the minimum support price for a box of bananas, which caused important markets, such as the European Union and Russia, to reduce their purchases.

In the case of Russia, where exports had a 19% drop in volume, another important factor was that five exporters were suspended for 12 days, by the Russian Veterinary and Phytosanitary Control Service, due to the apparent detection of the fly. humpback in banana containers from Ecuador.