Two of the world’s biggest chocolate manufacturers, Nestle and Hershey Company have expressed concerns over the ongoing Ebola epidemic in West African countries.
According to them, Ebola outbreak in West Africa – where 70 percent of the world’s cocoa supply originates – may affect the $12 billion global cocoa market if the virus is not curtailed.
While Hershey Company says U.S. cocoa stocks are high enough to maintain supply of cocoa into 2015, fears are rising that the disease could spread to neighbouring countries like Ghana and the Ivory Coast where 60 percent of the world cocoa is produced.
Early this month, World Health Organization urged Ivory Coast and 12 other countries to prepare for cases of the Ebola virus to ensure the epidemic does not spread further.
Ivory Coast, which borders two of the worst hit Ebola nations – Guinea and Liberia – has already closed its borders with the Ebola-affected nations and barred migrant workers who pick cacao beans, the key produce used in chocolate making.
But this may not be enough to avail the threat completely. Already, cocoa prices have shot up in recent weeks and some chocolate makers have begun to increase their product’s retail prices. Hersey also noted that the travel ban from U.S. to West Africa will not only affect domestic travel but international business as well.
Nestlé CEO, Paul Bulcke, in a press conference last week hinted that a not-so-positive financial report was on the offing. “This may be partly caused by the Ebola epidemic,” he said.
According to Bulcke, Nestle is on “high alert” for Ebola-related disruptions and the company is working on how to deal with the possible impact of Ebola outbreak in West Africa, especially on its production and possible effect on cocoa prices.
While Nestle has no factories in the three most affected countries, Ghana houses the company’s central and West African base.
Meanwhile, the World Cocoa Foundation (WCF) in its recent annual meeting pledged to donate $600,000 to support Ebola prevention and care efforts led by the International Federation of Red Cross and Red Crescent Societies and Caritas.
Some of the donations were made by WCF’s more than 100 corporations including Hershey Co., Godiva Chocolatier, Inc., Ghirardelli Chocolate Company and Nestle.