Full Breakdown
Brazil's Aspirations for Cocoa Farming Diminish Amid Price Collapse
3/13/2026, 2:29:54 PM
Cocoa Price Crash Impacts Expansion Plans
Brazilian cocoa farmers are halting new planting initiatives following a dramatic 70% decline in cocoa prices from their record highs in late 2024. Prices have plummeted from over $11,000 per metric ton to approximately $3,000, leading to expectations that nearly half of the planned industrial-scale cocoa projects in the country may be canceled. These projects, primarily located in Northeastern Brazil, were anticipated to expand cocoa cultivation by around 75,000 hectares, potentially supplying 4.5% to 5% of global cocoa demand.
Paulo Torres, a cocoa industry advisor and farmer in Bahia, expressed that the current prices do not justify the investment required for new fields, stating, "Brazil expansion plans have had a massive cold shower." The cancellation of these projects is significant as they were seen as a solution to supply shortages that had previously driven cocoa prices to unprecedented levels.
Factors Contributing to the Price Decline
The cocoa price decline is attributed to several factors, including a recovery in production from West Africa, which produces nearly 50% of the world's cocoa. Following adverse conditions in 2023 and 2024, including unfavorable weather and illegal mining, prices had surged, prompting traders to scramble for beans. However, as production stabilized, demand weakened, exacerbated by the introduction of weight-loss drugs that reduced chocolate consumption. Consequently, the chocolate industry has shifted towards non-cocoa ingredients, further diminishing demand for cocoa beans.
Moises Schmidt, a prominent cocoa farmer, indicated that current prices do not cover the costs associated with irrigation and machinery, stating, "If the market remains below $5,000 per ton, more than 50% of the projects are gone." This sentiment reflects the broader uncertainty among farmers and investors regarding the viability of large-scale cocoa farming in Brazil.
Ongoing Projects and Future Prospects
Despite the setbacks, some initiatives are still moving forward. Brazilian co-op Cooabriel plans to continue its small-scale cocoa project in collaboration with Cargill, while the Sao Paulo state government is pursuing efforts to use cocoa trees for reforestation. Ricardo Pereira, a coordinator for the state government, noted that seedlings are ready for planting, suggesting a commitment to sustainable practices even amid market challenges.
Experts believe that while large-scale cocoa production may slow, Brazil could still see growth through diversification strategies, integrating cocoa cultivation with other crops. However, the ambitious plans for rapid expansion have been significantly curtailed.
Conflicting Reports & Gaps
There are discrepancies regarding the extent of project cancellations. While some sources suggest that over 50% of planned projects may be shelved, others indicate that certain initiatives are still under evaluation. The future of large-scale cocoa farming in Brazil remains uncertain, with ongoing assessments by various stakeholders.
Verbatim Quotes
- "I think Brazil expansion plans have had a massive cold shower." — Paulo Torres, Cocoa Industry Advisor
- "If the market remains below $5,000 per ton, more than 50% of the projects are gone." — Moises Schmidt, Cocoa Farmer
- "In some areas, we already have seedlings almost ready to go into the field." — Ricardo Pereira, Coordinator, Sao Paulo State Government
The situation underscores the volatility of agricultural markets and the challenges faced by farmers in adapting to fluctuating prices and changing consumer demands.
