**Barry Callebaut Lowers Sales Volume Forecast Amid Cocoa Price Fluctuations**
Swiss cocoa grinder Barry Callebaut AG has revised its sales volume guidance downward for the second time in three months, citing ongoing volatility in cocoa bean prices. In early trading in Zurich, shares dropped by as much as 10%, marking the steepest decline since April. The company now anticipates a 7% decrease in full-year sales volume, a revision from the previously expected mid single-digit decline announced in April.
For the first nine months of its fiscal year, Barry Callebaut reported revenues of CHF 10.95 billion ($13.8 billion) alongside a 6.3% drop in sales volume. The firm noted that the global chocolate market experienced its most significant decline in a decade during the third quarter. Looking ahead, Barry Callebaut projects a mid to high single-digit increase in recurring earnings before interest and taxes in local currencies for the fiscal year 2024/25, a downgrade from earlier expectations of a double-digit rise.
The company has faced challenges in passing on increased cocoa prices to its chocolate-manufacturing clients, unlike consumer brands such as Swiss Lindt & Spruengli AG, due to its limited premium brand pricing power. Although cocoa bean prices have fallen over 30% this year and higher production is anticipated for the upcoming season starting in October, chocolate manufacturers are still working through costly inventories, which keeps prices elevated. Additionally, uncertainty surrounding potential tariffs from the U.S. is further impacting demand.
In North America, Barry Callebaut’s global chocolate business reported a 12.3% decline in third-quarter sales volume. Analyst Edward Hockin from JPMorgan Chase & Co commented that the weak sales volumes in Q3 diminish the visibility of when a return to volume growth might occur, indicating potential risks to next year’s consensus volume expectations.
Since the beginning of 2024, Barry Callebaut’s share price has plummeted over 30%, primarily due to surging cocoa prices driven by poor harvests in West Africa and other key growing regions. The company is currently undergoing restructuring under CEO Peter Feld, who aims to strengthen relationships with business-to-business clients.
**FAQ**
**What factors are affecting Barry Callebaut’s sales volume?**
Barry Callebaut’s sales volume is being impacted by cocoa price volatility, challenges in passing on costs to clients, and a significant decline in the global chocolate market.
