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Fast Company
36 minutes ago
- Fast Company
Your favorite candy just got pricier, and it's not because of tariffs
If you're planning to roast s'mores over a campfire this summer, you'll be spending more than last year on one ingredient you can't skip. Hershey plans to raise prices on its products to offset the cost of cocoa, a commodity that's been on a pricing rollercoaster of its own in the last two years. CBS News reports that the company will introduce a 'low double-digit increase' in prices across its products. Hershey owns many of the most popular candy brands in the U.S., including Reese's, Kit Kat and York, as well as non-chocolate candies like Twizzlers and Jolly Rancher. The price hike will likely go into effect within 90 days, though that timeline may vary. Last year, the price of cocoa hit historical highs, soaring past $10,000 per metric ton. Cocoa prices began spiking at the beginning of 2024, doubling over the course of the year and tripling when looking back to late 2023. Over the last month, cocoa dipped well below its record highs, but still costs more than twice what it did two years ago. Cocoa powder, used to make chocolate, comes from the seeds of the cacao tree, a water-intensive plant grown in tropical parts of Africa and South America. West Africa accounts for three quarters of the world's cocoa supply, with the Ivory Coast and Ghana being the world's top two cocoa-exporting nations. With the global appetite for chocolate relying on a single region in Africa, cocoa is relatively vulnerable to forces outside of farmers' control – particularly climate-caused weather events worsening as the planet warms. The climate crisis is expected to cause accelerating agricultural losses for staple crops like corn and wheat around the globe, and cocoa is no different. Excessive rainfall in late 2023 caused cacao pods to rot, one factor that sent the price of the commodity sky-high. Intense heat is also taking its toll on cocoa farming and cacao trees can struggle to produce pods when temperatures stretch above the plant's ideal range for days on end. Less production means higher prices, though those effects might not have been fully felt by consumers right away. 'Pricing has yet to pick up meaningfully, but we expect this to accelerate potentially to the low-teens in 2025,' said Celine Pannuti, J.P. Morgan's Head of European Staples & Beverages said in a late 2024 report on the cocoa crunch. 'We see the chocolate market set for inflation largely unprecedented in recent history.' Chocolate in a changing economy Hershey says that its planned price increase isn't related to tariffs, but the company has identified tariffs as a threat to its business before. Cocoa can't be grown in the U.S., and must be imported, making it vulnerable not only to a changing climate, but to the whims of a president keen to inject chaos into global trade. In May, Hershey was pursuing an exemption with the Trump administration that would allow the company to import its key ingredient without taking on new costs associated with tariffs. In an earnings call, the company estimated that Trump's tariffs would cost it between $15 and $20 million in the second quarter of the year. 'Absent tariff relief, this expense is expected to increase in the third quarter as we work through inventory on hand,' Hershey CFO Steve Voskuil said on the call. Given that Hershey's prices will increase, the company likely did not secure an exemption for its cocoa imports – particularly since any conversation with Trump would likely come with threats against raising prices. Fast Company has reached out to Hershey for an update on its pursuit of a tariff exemption for its cocoa imports. 'As a largely domestic food producer, we are relatively less exposed to tariffs than other Industries,' Hershey CEO Michele Buck said in May. 'That said, the current U.S. levy on cocoa is an exposure that we must manage on top of the cocoa market's unprecedented recent price swings.' Cocoa might be more expensive now, but Hershey is optimistic about the future, noting in its last earnings call that cocoa supplies from the world's top three suppliers should be up by 20%. The spike in cocoa prices also led to a flurry of cocoa farming investment, a move that could improve yields in the future. 'There are reasons to believe that this year's crop marks the beginning of a multi-year growth cycle in cocoa supply,' Buck said. 'In the meantime, global end users are now responding to persistently high prices in earnest, having waited and watched for some time.'
Yahoo
an hour ago
- Yahoo
Cipher Mining (CIFR) Jumps Alongside Bitcoin Ahead of Q2 Results
We recently published . Cipher Mining Inc. (NASDAQ:CIFR) is one of Tuesday's top performers. Cipher Mining jumped by 11.04 percent on Tuesday to close at $6.94 apiece, tracking the rally in Bitcoin prices, while investors repositioned portfolios ahead of the release of its second quarter results. According to the company, it is slated to release the results of its financial and operational performance for the April to June period on August 7. A conference call will be held at 8 AM Eastern Time. As of this writing, prices of Bitcoin were up by 2.17 percent at nearly $120,000 apiece as investors grew more confident about the industry, with more financial institutions beginning to slowly adopt and offer cryptocurrency-related products. Earlier this month, Cipher Mining Inc. (NASDAQ:CIFR) said it was able to mine 160 Bitcoins and sold 58 last month, bringing its total ownership to 1,063. A close-up of a laptop with a Bitcoin ecosystem monitor running in the background. It said the Bitcoins were produced at an operating hash rate of 16.8 EH/s. In the third quarter, Cipher Mining Inc. (NASDAQ:CIFR) expects to ramp up its operational hash rate to around 23.1 EH/S with new mining rigs expected for delivery in scheduled batches. While we acknowledge the potential of CIFR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the .
Yahoo
an hour ago
- Yahoo
Hershey to increase candy prices by double digits as cocoa costs rise
The Hershey Company on Tuesday confirmed media reports it is raising candy prices as it battles rising cocoa costs. The price change will be a "low double-digit increase" and affect products across the company's confection portfolio, according to a Hershey spokesperson. Founded in 1894, the Pennsylvania-based company owns over 90 brands including Hershey Kisses, KitKat, Reese's and York. "This change is not related to tariffs or trade policies," the spokesperson said in a statement to CBS News. "It reflects the reality of rising ingredient costs including the unprecedented cost of cocoa." Price increases typically take around 90 days to take effect, although the timeframe varies by retailer, the spokesperson added. Global cocoa shortage Cocoa prices have skyrocketed in recent years due to a global cocoa shortage. The cost for the commodity was $8,402 in June, a 73% increase from five years ago, according to data from the Federal Reserve Bank of St. Louis, which tracks food prices. The majority of the world's cocoa supply comes from Ghana and the Ivory Coast, which have faced heatwaves and heavy rain linked to climate change. These unfavorable weather conditions have led to diseases like Black pod rot, which kills cocoa crops. Chronic underinvestment in cocoa farms is another reason behind the spike in cocoa prices, according to an article from J.P. Morgan Global Research. "Cocoa is a market where the grower produces a very high-value good but receives a very low share of the actual value chain. As a result, replanting rates of diseased trees are low and West African yields have been more subject to weather impacts," Tracey Allen, an agricultural commodities strategist at J.P. Morgan, said in the article. In a May earnings call, Michele Buck, president of The Hershey Company, said the candy company would lean into products that are "less Cocoa intensive" as it navigates the inflation of cocoa prices. This is part of the company's vision to become a "snacking powerhouse" Buck said. "We love our chocolate business and we want to continue to grow that," Buck said. "But we also know that if we get into white spaces like sweets, better-for-you and salty, it adds incremental consumers and occasions," she added. Hershey share prices were up 2.8% after the closing bell on Tuesday. Ozzy Osbourne, heavy metal pioneer, dies at age 76 Sneak peek: The Case of the Black Swan (Part 2) Idaho murders victims' families speak out at Brian Kohberger's sentencing hearing
