Papua New Guinea achieved record cocoa exports in 2024, generating PGK1,233 million, surpassing coffee’s PGK989 million. However, coffee is expected to regain dominance in 2025 with projected revenues of PGK1,580 million against PGK1,363 million for cocoa. Global market dynamics are influencing pricing and volumes for both commodities, with strong predictions for coffee demand and potential for increased cocoa yields.
Papua New Guinea achieved a record year for cocoa exports in 2024, generating PGK1,233 million, surpassing coffee revenue of PGK989 million for the first time in history. However, this improved ranking is anticipated to be temporary, as cocoa production cannot increase significantly in a short timeframe due to historical crop size limitations. In contrast, coffee is projected to have a strong year, recovering from a prior low-volume season, with alternating high- and low-yield cycles.
Coffee prices have experienced a substantial increase due to unfavorable weather conditions affecting Brazil’s crop. Record prices and heightened export volumes are likely to enable coffee to regain its leading position over cocoa in 2025. Projections indicate that coffee may yield PGK1,580 million in export revenue while cocoa is expected to generate PGK1,363 million, resulting in a combined total of PGK3,000 million, surpassing last year’s record.
In the global context, cocoa production faced a significant decline of 13.1 percent, totaling 4.3 million tons in 2024 due to drought and disease in key producing countries. Despite this, robust demand has driven prices to an average of USD8,214 per ton. The anticipated price for cocoa may average USD8,000 per ton for the year due to ongoing crop shortages, although recent rains in West Africa offer some hope for improved yields later this year.
With respect to coffee, Brazil’s downgrading of Arabica bean production due to La Niña effects is expected to diminish yield volumes significantly. The global coffee price reached a peak of USD4.39 per pound in February 2025. The strong demand ensures coffee prices are likely to remain high, averaging USD2.95 per pound, marking the highest annual average to date.
While PNG’s coffee exports decreased by 14.1 percent in 2024, forecasts indicate that nearly a million bags might be exported in 2025, despite an expected low-volume crop initially. The record prices present significant incentives for farmers, particularly in remote areas, to bring their products to market. However, the rise in prices may also pose challenges for stakeholders in the supply chain concerning working capital needs.
Cocoa exports also witnessed an increase, with PNG exporting approximately 39,000 tons in 2023, a 1.3 percent rise year-on-year. Despite necessary stimulation to boost export volumes, previous market shifts have led some farmers to transition towards balsa wood, adversely impacting cocoa production. Nevertheless, due to the favorable market prices, yield improvements are anticipated.
Historically, PNG’s coffee has consistently outperformed cocoa in export receipts, but the positions may reverse in 2025, with coffee forecasting higher revenue. PNG remains significantly influenced by global market prices, facing challenges to maintain competitive rates in international commodity markets, particularly if domestic prices diverge from global trends.
In summary, 2024 marked a pivotal year for Papua New Guinea’s cocoa exports, achieving record levels, while coffee is projected to reclaim its top position in 2025 due to anticipated increases in production and prices. Current market dynamics indicate continued strong demand for both commodities, yet also present challenges concerning supply chain management and global pricing competitiveness. Overall, the outlook for both coffee and cocoa remains robust, though extensive care is needed for future sustainability and growth in these sectors.
Original Source: www.fijitimes.com.fj
