The Cocoa Crisis: Examining the Threats to Ivory Coast’s $100 Billion Industry

Introduction

The global chocolate industry, valued at approximately $100 billion, faces unprecedented challenges as its foundation—cocoa production in West Africa—confronts a convergence of environmental, economic, and social pressures that threaten the sustainability of this massive sector.

FAF, Africa.Media analyzes Ivory Coast, as the world’s leading cocoa producer, accounting for 45% of global production, sits at the epicenter of a crisis that could fundamentally reshape the chocolate industry and the livelihoods of millions who depend on it.

The industry faces interconnected threats, including climate change impacts, devastating plant diseases, widespread deforestation, farmer poverty, and dramatic production declines. These have sent cocoa prices soaring by over 400% in recent years.

These challenges reveal a sector in transition, where the traditional model of cocoa production is increasingly unsustainable, forcing governments, corporations, and farmers to confront difficult questions about the future viability of an industry that supports an estimated 6 million people in Ivory Coast alone.

Ivory Coast’s Dominance in Global Cocoa Production

Ivory Coast’s position as the world’s premier cocoa producer represents an economic cornerstone and a source of vulnerability for the global chocolate industry.

The country produces approximately 1.8 to 2 million metric tons of cocoa annually, representing 45% of global production and generating between $3.2 and $3.68 billion in export revenues in recent years.

This agricultural dominance has made cocoa cultivation the backbone of the Ivorian economy, contributing 40% of national export income, 15-20% of gross domestic product, and employing over 1.2 million small-scale farmers nationwide.

The sector’s economic significance extends far beyond direct agricultural employment. An estimated 6 to 8 million people depend on cocoa-related industries for their livelihoods.

The country’s cocoa production system is characterized by smallholder farming operations, with most farmers cultivating plots of 1 to 3 hectares using traditional methods.

These small-scale operations form the foundation of a complex supply chain that connects rural farmers to global commodity markets, where major chocolate manufacturers such as Cadbury, Hershey’s, and Nestlé purchase Ivorian cocoa futures through international exchanges.

The concentration of global cocoa production in the Ivory Coast and neighboring Ghana, which account for over 60% of world output, creates economic opportunities and systemic risks for the worldwide chocolate industry.

When production in these regions falters, as has occurred in recent seasons, the ripple effects are felt throughout international markets, demonstrating the fragility of a system so dependent on a small geographic area.

Economic Disparity and Farmer Poverty

Despite Ivory Coast’s central role in a $100 billion global chocolate industry, the economic benefits of cocoa production remain heavily skewed toward processing and retail companies rather than the farmers who cultivate the crop.

Cocoa-producing countries receive only approximately 6% of the total value generated by the global chocolate market, with a mere 2% reaching the farmers themselves.

This stark economic disparity is exemplified by the fact that millions of cocoa farmers in the Ivory Coast survive on an average of just $0.78 per day, well below international poverty thresholds.

To put this inequality in perspective, a single kilogram of premium Leonidas chocolate, which costs approximately $32 in European markets, would require an Ivorian farmer 45 days of work to afford.

The economic challenges facing cocoa farmers are compounded by the global cocoa value chain structure, where the bulk of value addition occurs in processing and manufacturing stages that typically occur outside of producing countries.

As of 2019, only 35% of Ivory Coast’s cocoa was processed locally, meaning that most of the crop is exported as raw beans rather than higher-value processed products.

This pattern limits the economic opportunities available to Ivorian workers and constrains the country’s ability to capture a larger share of the industry’s profits.

Farmers like Eugene Kouassi, who tends a two-acre plot in Soubre, exemplify these challenges. They expect to earn only $1,200 to $1,500 from an entire year’s harvest to support a family of eight.

Such economic pressures have led the Ivorian government to implement various measures to increase farmer incomes, including raising farmgate prices by 50% for mid-crop beans in response to supply shortages.

Climate Change

An Existential Threat

Climate change represents perhaps the most fundamental long-term threat to Ivory Coast’s cocoa industry. Scientific projections indicate potentially catastrophic impacts on production capacity within the coming decades.

New research suggests that ongoing climate change could result in West and Central Africa losing up to 50% of currently suitable cocoa-growing areas by 2050, with Ivory Coast facing particularly severe challenges.

The northern edges of cocoa-production zones in Ivory Coast and Ghana are projected to experience the worst yield reductions, with potential decreases of 12% in areas that are already becoming marginal for cocoa cultivation.

These projections are based on sophisticated climate modeling that accounts for changing temperature and rainfall patterns, critical factors in cocoa tree health and productivity.

The immediate impacts of climate change are already visible in Ivory Coast’s cocoa-growing regions, where farmers report increasingly erratic weather patterns that disrupt traditional farming cycles.

In 2024, human-caused climate change added six weeks’ worth of days above 32°C in 71% of cacao-producing areas across Ivory Coast, Ghana, Cameroon, and Nigeria—temperatures exceeding the optimal cacao tree range.

These extreme temperatures and changes in rainfall patterns have contributed to the devastating production declines experienced in recent seasons.

The 2023 heatwave in West Africa, which climate scientists determined was made 10 times more likely by human-caused climate change, exemplifies the growing frequency and intensity of weather events that threaten cocoa production.

Farmers in regions like Soubre report that climate-related challenges have become a primary concern, with some fearing they will harvest significantly less than expected due to erratic rains and changing weather patterns.

Disease and Pest Pressures

The spread of plant diseases and pests represents another critical threat to Ivory Coast’s cocoa industry, with the Cocoa Swollen Shoot Virus Disease (CSSVD) emerging as a particularly devastating challenge.

CSSVD, spread by mealybugs, has reached endemic status across West Africa and causes annual yield losses of 25-30% under normal circumstances, with losses reaching up to 75% when left uncontrolled.

The disease can kill cocoa trees within a few years of infection, forcing farmers to remove and replace affected trees.

This process results in significant economic losses and disrupts long-term farming plans.

In Ivory Coast, approximately 15-20% of plantations are currently affected by CSSVD, compared to 40% in neighboring Ghana, indicating the potential for further spread if not properly managed.

Beyond CSSVD, Ivory Coast’s cocoa farmers face additional challenges from capsid bugs, black pod disease, and other pests threatening crop yields and farmer livelihoods.

The primary damage from these insects results from their stinging action on twigs and fruit, causing young cocoa pods to die and fall off before maturation.

Many farmers have resorted to chemical pesticides to combat these threats, but such approaches damage soil fertility and contaminate water sources, creating additional environmental and health concerns.

The relationship between climate change and disease pressure has become increasingly apparent as rising temperatures and changing rainfall patterns create more favorable conditions for pest proliferation and disease transmission.

These interconnected challenges highlight the need for integrated pest management approaches that address immediate threats and underlying environmental factors.

Deforestation and Sustainability Challenges

Cocoa production on the Ivory Coast has become the leading driver of deforestation in the country, creating a sustainability crisis that threatens both environmental conservation and the industry's long-term viability.

Between 2000 and 2019, approximately 2.4 million hectares of forest—an area nearly the size of Rwanda—was cleared primarily for cocoa plantations, representing 45% of total deforestation and forest degradation in the country.

This massive forest loss has occurred despite legal protections, with 25% of cocoa production areas located within designated protected areas and forest reserves as of 2019.

The weak enforcement of environmental laws has allowed this encroachment to remain largely unchecked, creating environmental damage and regulatory risks for companies sourcing from these areas.

The deforestation associated with cocoa production creates a vicious cycle that ultimately undermines the industry’s sustainability.

Forest clearing leads to soil degradation, reduced fertility, and increased erosion, reducing cocoa yields and forcing farmers to clear additional forest areas to maintain production levels.

This pattern has been particularly pronounced in West Africa, where cocoa expansion has resulted in widespread ecosystem degradation that affects both environmental health and agricultural productivity.

Major commodity traders, including Cargill, Olam, Barry Callebaut, and Touton, face increasing exposure to deforestation-related risks, as over 55% of cocoa from the Ivory Coast is associated with some forest loss.

Implementing EU deforestation-free product regulations, scheduled to take effect on December 30, 2025, for large companies, adds regulatory pressure that could fundamentally alter trading relationships and supply chain management practices.

Recent Production Declines and Market Volatility

Ivory Coast’s cocoa industry has experienced dramatic production declines in recent seasons, with output falling to levels not seen in nearly a decade and triggering unprecedented market volatility.

Production dropped from approximately 2.3 million metric tons in the 2022/2023 season to around 1.75 million tons in 2023/2024, representing a decline of over 24%.

Early projections for the 2024/2025 season suggested a recovery to 2.1-2.2 million tons, but adverse weather conditions and continued crop challenges have tempered these expectations.

The International Cocoa Organization projects production may reach 2 million metric tons for 2024/2025, still significantly below historical averages of 2.2 million tons.

These production shortfalls have created severe market disruptions, with cocoa prices surging by 143% since the beginning of 2024 and reaching the worst shortage in four decades.

The supply crisis has been compounded by declining global cocoa inventories, which have fallen to three-year lows, and reduced processing activity in major markets, including North America, Asia, and Europe.

In response to these market pressures, both Ivory Coast and Ghana have implemented significant increases in farmgate prices, with Ivory Coast raising mid-crop bean prices by 50% and Ghana implementing a 58% increase for the remainder of the 2023-24 season.

The Ivorian government has also taken the unprecedented step of halting all forward cocoa sales for the 2024-25 season to assess future production levels better and manage supply chain risks.

Industry Responses and Adaptation Efforts

The mounting challenges facing Ivory Coast’s cocoa industry have prompted various response measures from government agencies, international organizations, and private companies to stabilize production and improve sustainability.

The Ivorian government has announced ambitious targets to process 100% of cocoa beans locally, moving away from the current model where most production is exported as raw materials.

This transformation strategy includes significant infrastructure investments, such as Cargill’s $100 million expansion of its Yopougon processing facility, which increased capacity by 50% and created nearly 100 full-time local jobs.

Chinese companies have also contributed to this industrialization effort, with projects like the PK24 industrial park cocoa processing plant, which is designed to become Ivory Coast’s largest domestic cocoa processing facility.

Research and development initiatives focus on biological control methods to address pest and disease challenges while reducing reliance on chemical pesticides.

A collaborative project between the Félix Houphouët-Boigny University in Abidjan and the Ivorian Fair Trade Network is developing cost-effective biopesticides to protect cocoa trees from pests and diseases.

This 18-month initiative aims to directly support 200 cocoa farmers from four cooperatives while gathering data for potential scaling to broader implementation.

The project addresses multiple objectives, including increasing farmers’ access to eco-friendly pest control, reducing chemical pesticide use, increasing overall yields, and contributing to environmental protection.

Such initiatives represent a growing recognition that sustainable cocoa production requires integrated approaches that address immediate productivity challenges and long-term environmental sustainability.

Conclusion

The $100 billion global chocolate industry, anchored by Ivory Coast’s dominant cocoa production, faces a convergence of threats that pose significant risks to its long-term sustainability and the livelihoods of millions who depend on it.

Climate change projections indicating potential losses of up to 50% of suitable growing areas by 2050, combined with devastating disease pressures, widespread deforestation, and persistent farmer poverty, paint a picture of an industry in crisis.

Recent production declines, which have sent prices soaring by over 400%, demonstrate the immediate vulnerability of global chocolate supply chains to disruptions in West African production.

However, the industry’s response through processing capacity expansion, sustainable farming initiatives, and biological pest control development suggests that it recognizes these challenges and is committed to adaptation strategies.

The success of transformation efforts, including local value addition and climate-resilient farming practices, will ultimately determine whether Ivory Coast can maintain its position as the world’s leading cocoa producer while ensuring the long-term viability of an industry that supports millions of livelihoods.

The stakes extend far beyond chocolate prices, encompassing food security, environmental conservation, and economic development for one of the world’s most important agricultural sectors.