Average 12% Increase for 17 Types from May 1
Cocoa Prices Hit All-Time High... "Expected to Rise Further"
Due to the sharp rise in cocoa prices, the prices of major Lotte Wellfood products such as Ghana, Pepero, and Binch will increase by an average of more than 10%.
Lotte Wellfood announced on the 18th that it will raise the prices of some products by distribution channel starting next month on the 1st. Seventeen types of chocolate products made from cocoa as a raw material are subject to the increase, with an average hike rate of 12.0%.
Major confectionery products include Ghana Mild 34g, whose suggested retail price will rise from 1,200 won to 1,400 won; Choco Pepero 54g from 1,700 won to 1,800 won; Crunky 34g from 1,200 won to 1,400 won; ABC Choco 187g from 6,000 won to 6,600 won; Binch 102g from 2,800 won to 3,000 won; Kancho 54g from 1,200 won to 1,300 won; and Myungga Chal Tteok Pie 6-pack from 4,000 won to 4,200 won. For ice cream products, Gugu Cluster will increase from 5,000 won to 5,500 won, and Tico from 6,000 won to 7,000 won.
This price increase is due to the sharp rise in cocoa prices, the main raw material for chocolate. Cocoa prices are hitting record highs. According to the ICE Futures Exchange on the 15th, cocoa futures prices reached $10,559 per ton. The previous record was $4,663 per ton (July 20, 1977), but this year in January, it was surpassed for the first time in 47 years and has been breaking records daily since. For decades, cocoa prices had been stable around $2,000 per ton, but prices started rising last year and surged dramatically from early this year.
A Lotte Wellfood official said, "The problem is that the current trend is likely to continue." In fact, due to weather anomalies such as El Ni?o and cocoa diseases, cocoa production in West African countries Ghana and C?te d'Ivoire, which account for more than 60% of global cocoa production, sharply declined last year. While cocoa cultivation area is expected to continue decreasing, chocolate consumption in countries like China is expected to increase, raising the possibility of prolonged supply and demand instability.
Lotte Wellfood is the largest chocolate business operator in Korea and runs the only domestic factory that imports cocoa beans and produces chocolate in Yangsan, Gyeongnam. Although it cannot fully reflect the price increase in the market, it had no choice but to implement a limited price increase for chocolate products and asked for customers' understanding.
A Lotte Wellfood official said, "With rising processing costs such as labor costs, it was inevitable to raise prices for chocolate products by Lotte Wellfood, the only domestic company using raw cocoa materials," adding, "We will do our best to maintain product quality while actively preparing for long-term supply instability."
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