Mondelez halts product deliveries amid price dispute with REWE

Mondelez products, including brands such as Oreo, Alpen Gold, and Milka, are disappearing from store shelves in Germany due to the manufacturer's proposed price hikes.

The newspaper "Rzeczpospolita" has reported that Mondelez has stopped supplying its products, including popular brands like Oreo, Milka, BelVita, and AlpenGold, to REWE, the second-largest supermarket chain in Germany.

According to the "Retail Detail" news service, which cites industry sources, the confectionery giant Mondelez intends to increase the prices of its offerings, a move that REWE is unwilling to accept. Consequently, the American company has ceased deliveries to the retailer's outlets.

REWE franchisees are expressing discontent over the shortage of products, as it diminishes their competitive edge. Meanwhile, Mondelez will leverage this situation to press REWE to agree to the price hikes.

The impending price surges are attributed to several months of historically high cocoa prices on the global market. According to WP Finances, this steep escalation results from below-average harvests in Ivory Coast and Ghana, contributing to two-thirds of the world's cocoa bean supply. Harvest yields have been markedly impacted this season by heat, droughts, sudden storms, and tree diseases that wreak havoc on the plantations.

Most cocoa beans are cultivated in Africa, where they are shipped and processed predominantly in industrialized nations. Farmers in Ghana and Ivory Coast lament that the proceeds from bean sales fall short of covering the costs required for investments and planting new trees, with the existing ones producing less and becoming more disease-prone.

Experts are forecasting that the market price of cocoa could surge beyond CAD 15,500 to CAD 16,800 per ton by the end of the year, potentially even nearing CAD 19,400.