Double-Digit Inflation Strikes the U.S. Candy Aisle for the Second Year in a Row
Spooked by the high price of Halloween candy? There’s no relief in sight.
U.S. shoppers are experiencing double-digit inflation in the candy aisle for the second consecutive year. According to Datasembly, a retail price tracker, candy and gum prices have increased by an average of 13% this month compared to last October. This is more than double the 6% rise in overall grocery prices. Furthermore, these price hikes come on top of a 14% increase in candy and gum prices in October 2022.
“The price of candy has become exorbitant,” stated Jessica Weathers, a small business owner in Shiloh, Illinois. She added, “It doesn’t make sense to spend $100 on candy.”
Traditionally, Weathers used to purchase plenty of candy for trick-or-treaters and events at school and church. However, this year, she only bought two bags and plans to turn off her porch light on Halloween once she runs out of candy.
Other consumers are also altering their candy buying habits. Numerator, a market research firm, reports that about one-third of U.S. consumers intend to opt for value or store brands when purchasing candy for trick-or-treaters this year.
Weather is primarily to blame for the soaring prices. Cocoa prices have reached 44-year highs due to heavy rains in West Africa, resulting in limited production in the preceding season. Additionally, El Nino conditions are prolonging dryness in the region and are expected to persist well into spring.
“There seems to be no relief in sight, at least until the first half of 2024,” warned Dan Sadler, principal of client insights at Circana, a market research firm.
Kelly Goughary, a senior research analyst at Gro Intelligence, an agricultural analytics firm, revealed that Ivory Coast, which produces approximately 40% of the world’s cocoa, is already experiencing one of its worst droughts since 2003.
Moreover, global sugar prices are at 12-year highs. Goughary explained that India, the world’s second-largest sugar producer after Brazil, recently imposed a ban on sugar exports for the first time in seven years due to adverse effects from monsoon rains on the upcoming harvest. Thailand’s sugar output has also decreased.
These costs, coupled with increases in labor, packaging, and ingredients like peanuts, are driving up prices for all types of candy.
Discount grocer Aldi is offering a 250-piece variety pack of Mars Inc. chocolate bars, including Milky Way, Twix, and Snickers, for $24.98. Two years ago, the same package was priced at $19.54.
Hershey Co., which has raised its prices by 7% or more in each of the past seven quarters, admitted this week that higher prices are impacting demand. Hershey’s North American confectionary sales volumes declined by 1% in the July-September period.
“We understand that value and affordability are crucial for consumers as budgets are stretched thin,” stated Hershey’s President and CEO Michele Buck during a conference call with investors.
Buck added that Hershey is striving to meet consumer needs by offering products in value stores and various price points.
