The price of candy has significantly increased, with the consumer price index for candy and chewing gum rising 32 percent between December 2019 and November 2024. This surge is largely attributed to soaring ingredient costs, particularly for cocoa, sugar, and corn syrup, which constitute about 65 percent of the U.S. confectionery industry's input expenses.
The cost of confectionery materials, including cocoa products and corn sweeteners, saw a dramatic rise of 87.6 percent over the same period, according to research from the U.S. Bureau of Labor Statistics (BLS). The import price index for sugar and confectionery manufacturing also climbed 73.3 percent.
Cocoa, accounting for approximately 28.4 percent of ingredient costs, has faced immense pressure. Global cocoa production dropped more than 13 percent in the 2023-24 season, primarily due to adverse weather conditions in West Africa, where Cote d'Ivoire and Ghana are major producers. Hotter, drier weather reduced soil moisture, while heavy rainfall contributed to crop diseases. Ghana's 2023-24 crop reached a 23-year low, leading to a significant supply squeeze.
Cocoa futures reflected these supply issues, climbing sharply from late 2022. After trading between $1,000 and $3,500 per metric ton from 2000 through the third quarter of 2022, prices briefly surpassed $11,000 per metric ton in April 2024 and reached a record $12,565 per metric ton in December 2024, according to the BLS. While speculation from traders added to market pressure, it is not considered the primary driver of the price explosion.
Sugar prices have also increased. U.S. sugar imports are restricted by government policies, maintaining domestic prices above international levels. Mexico, a traditional supplier, experienced reduced production due to drought, leading to its lowest output in 24 years and a 17-year low in exports to the U.S. Global sugar production was also affected by dry conditions in India and Thailand, and logistical issues in Brazil, the world's largest exporter. Additionally, a significant portion of Brazil's sugarcane crop was diverted to ethanol production.
These rising ingredient costs have been passed on to consumers. Prices for U.S.-made products containing cacao jumped 143.9 percent between December 2019 and November 2024, while imported cocoa products rose 107.4 percent. Sugar manufacturing prices increased by 43.8 percent, and corn sweeteners by 26.2 percent.
Beyond direct price increases, consumers are also experiencing "shrinkflation," where manufacturers reduce the product quantity while maintaining the same price. BLS research indicates that downsizing accounted for a 2.1 percent increase in candy and chewing gum prices between January 2019 and October 2023. This practice, often involving nearly identical packaging, makes the reduction less noticeable to shoppers.
Complaints about smaller candy sizes and higher prices are common on social media platforms, with consumers noting that items like M&Ms and Snickers bars are becoming expensive impulse purchases. Reports of reduced weight in popular chocolate brands, such as Hershey's, have also surfaced, often coinciding with rising cocoa prices.
Despite increased costs, consumer spending on sweets remained substantial, reaching $31.1 billion in 2024, though down from $32.2 billion in 2023. This figure is notably higher than the $21.8 billion recorded in 2019. However, there are signs of changing consumer behavior, with nonseasonal chocolate unit sales declining since mid-2022 and cocoa demand falling nearly 5 percent in the 2023-24 season.
Candy sales are heavily influenced by holidays, with Halloween, Christmas, Valentine's Day, and Easter accounting for roughly two-thirds of annual confectionery sales. This timing makes candy a significant expense for families during major celebrations.
Future pressures may arise from the European Union's Deforestation Regulation, set to take effect at the end of 2026, which aims to increase traceability and ensure sourced commodities like cocoa are not linked to deforestation.