El Niño is expected to reappear in 2023, and some analysts warn it could push dessert prices higher. This assessment mirrors notes from CNBC and related market observers who follow weather-driven shifts in agricultural commodities.
Rabobank analyst Carlos Mera points out that El Niño tends to act like a sugar highlighter for many crops. When droughts take hold in major growing regions for sugarcane, coffee, and cocoa, the cost of production climbs. The same weather pattern has historically pushed futures for orange juice, cocoa, coffee, and sugar upward because supply becomes constrained while demand remains steady or grows. In 2023, prices for orange juice surged to record levels, and other commodities followed, with cocoa, coffee, and sugar all moving higher as extreme weather intensified.
Mera explains that the structure of the cocoa trade amplifies price movement. In many key producing countries such as Ivory Coast and Ghana, farmers and mills engage in forward sales that book harvests well in advance. This means that a portion of chocolate sold today was effectively priced a year ago, before harvest weather shifts fully unfolded. Such forward contracts can create a lag between weather events and consumer prices, yet the overall effect tends to tilt retail prices upward when supply becomes tight.
The timeline for El Niño’s macro impact suggests a peak in market effects toward the end of the year, but the broader consequences often unfold with a delay. For consumers, this translates into noticeable price increases in 2024 as supply chains adjust to drier growing seasons and tighter inventories that follow the weather pattern.
Forecasting agencies and meteorological centers routinely note that El Niño can alter temperatures and rainfall in various regions, sometimes producing warmer winters in certain locales and shifting harvest schedules. When these shifts interact with global commodity markets, the resulting price dynamics can ripple through supermarkets and coffee shops alike, influencing a broad range of everyday goods from beverages to baked treats.
Industry watchers also anticipate that chocolate prices may continue to climb as the ripple effects of El Niño feed through the supply chain. For chocolate manufacturers, the cost of raw cocoa remains a central driver of pricing strategy, and any sustained tension in cocoa futures tends to find its way into finished products at the counter. Meanwhile, coffee markets remain sensitive to weather-driven supply concerns, with volatility that can affect both wholesale and consumer pricing.
In summary, the return of El Niño is prompting cautious attention from traders, retailers, and policymakers. While the exact timing and magnitude of price moves can vary by commodity and region, the prevailing view is clear: drought-related shortages in key producing areas tend to tighten supply and push prices higher, a trend that is likely to persist through the coming year as weather patterns unfold across major agricultural belts.
As markets adjust, consumers may notice more pronounced fluctuations in desserts, chocolates, and beverages that rely on the affected crops. Retailers and brands often respond by adjusting product formulations, sourcing strategies, or promotional activity to navigate these shifts in supply and cost. The interplay between climate patterns and commodity markets remains a critical factor shaping the price landscape for everyday goods in North America and beyond.