When major chocolate brands began removing cocoa from their products due to the high cost, backlash to their altered recipes was swift. 

One X user put into words what most people were thinking, writing succinctly, "Oh no." 

Another quipped, "What they substitute? Sawdust?"

Now, at a time when up to 40% of the world's food supply goes to waste, the global chocolate industry is facing a new struggle as cocoa prices begin to stabilize. 

What's happening?

Bloomberg reported that the cocoa industry is facing a surplus after chocolate makers began substituting cocoa in their offerings for cheaper ingredients, including fillers like nuts.

"We're not looking at a big surplus because we've had a big recovery in production. It's because we've had a big crash in final demand and changes in recipes," said Jonathan Parkman, head of agricultural sales at commodities brokerage Marex Group. 

Cocoa futures hit a record high in December 2024 after a prolonged drought in West Africa, which produces 80% of the world's cocoa, contributed to a poor harvest. In response, chocolate makers began adjusting their recipes to avoid sticker shock and remain profitable. 

Why is this important?

Cocoa prices remain above historical levels. As processors work through beans they purchased at higher rates, cocoa grinding should continue to stall, according to Vladimir Zientek, a senior trader at StoneX, who told Bloomberg that cocoa products are "still very expensive."

Bloomberg analysis found that cocoa grinding in Q4 of 2025 hit its lowest levels in 11 years in Europe, the top-consuming market. Grinding rates in Asia "probably" dipped to a 10-year low. 

"Demand destruction from elevated prices appears to outweigh seasonal support in the fourth quarter," Priyanka Sachdeva, a senior market analyst at Phillip Nova Pte, told Bloomberg. 

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As it stands, approximately 75% of pods end up as waste during cocoa production, according to the World Resources Institute. Cocoa shells can be repurposed as fertilizer or even as a more eco-friendly concrete; however, the industry faces substantial challenges in sustainably managing overproduction and limiting air pollution from potential waste. 

Martie is one company that is combating food waste by selling overstock and surplus inventory at highly discounted rates. 

What's being done about this?

The National Confectioners Association reported that North America's grinding rates rose in Q4, according to NASDAQ. Still, the cocoa industry remains in flux. 

NASDAQ reported that "favorable growing conditions" this season in West Africa are among the positive signs. That's particularly true for the farmers who rely on cocoa to support their families. Extreme weather conditions like droughts are disrupting livelihoods and food systems globally.

For consumers, this can raise the price of popular products, like chocolate. You can find brand-name goods up to 80% off retail prices at Martie.

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