Chocolate Shortage?

At first I was going to write up a quirky post about since there was a possibility of a shortage due to not enough farmers planting, so less would be harvested, maybe the drug cartels in South America would switch to chocolate production instead of cocaine production.  I had a punchline of how when the cost of chocolate was more per ounce than cocaine, we would start to have chocolate smugglers, and people would be helping them hide from the government.

However, it's not really that simple of a deal.

First I will direct you to the story that started the panic per se'.

"There's no easy way to say this: You're eating too much chocolate, all of you. And it's getting so out of hand that the world could be headed towards a potentially disastrous (if you love chocolate) scenario if it doesn't stop.

Those are, roughly speaking, the words of two huge chocolate makers, Mars, Inc. and Barry Callebaut. And there's some data to back them up."

I would like to point out that the write of that piece, Roberto A. Ferdman, one of the writers for the WonkBlog, the Ezra Klein vehicle which propelled him to Bloomberg, MSNBC, and now Vox Media.

So knowing that, you should take ANYTHING that Mr. Ferdman write with several dozen grains of salt, okay, maybe a dumptruck from the Minnesota Highway Department in Wintertime load of salt.

With a little more looking I find a rather well written and researched piece by Forbes writer Tim Worstall.


"The last few days have seen us regaled with a serious of stories about how the world is going to run out of chocolate. That would be, I think we can all agree, almost as bad as running out of bacon."

Great opening line, if you ask me.

He goes on to discuss the production, and how the market influences the production. Or rather how it SHOULD influence production.


"However, we’ve a bit of a puzzle here. Markets are usually pretty good at sorting these sorts of things out. OK, so demand rises, prices rise, farmers plant more (or in more general terms, producers producer more) and thus supply grows to meet that rising demand.

And in a proper market we can never actually have a “shortage”. We can only have a shortage of something at the price that people want to pay for it."

And then he goes on how the farmers are the ones getting screwed over by their own government.

"the government is paying the farmers £1 a kg or so and the market is indicating that supply and demand will balance at £1.88 a kg. So, what we’ve actually got here is some price fixing. And the price to the producers is fixed well below the market clearing price"

Seriously, just click on any of the links to the Forces story and RTWT.