Halloween Could Get Scarier For Trick-Or-Treaters As Candy Shortage Looms

This Halloween could be disappointing for some trick-or-treaters as Hershey (HSY) is predicting that it may not be able to meet consumer demand for holiday candy.

The Hershey Company CEO Michele Buck warned about the possible candy shortage during the company’s second-quarter earnings call with analysts on Thursday, saying, as reported by CNN, “We will not be able to fully meet consumer demand.”

Hershey said it is unable to make as much product as is needed due to supply chain issues, higher dairy prices, and ingredient shortages that are plaguing many producers globally. This has caused many companies, like Hershey, to discontinue products to keep up with the demand for other items.

The pandemic has caused candy demand to surge, and with Halloween right around the corner, the interest in themed candy has only inceased, CNN said. Halloween is Hershey’s busiest time of the year, as it accounts for 10% of the company’s annual sales, according to Reuters.

While demand has sent Hershey’s sales soaring – the company reported 19% growth to $2.37 billion for Q2 – the candymaker is having trouble keeping up. Hershey said it has had to make some sacrifices to its production as the same lines at its facilities produce both seasonal products and traditional offerings, CNN reported.

Buck explained that Hershey has had to prioritize “everyday on-shelf availability” and said during the earnings call that it “was a choice that we needed to make. It was a tough decision.”

To try and deal with the added candy demand, Hershey is adding more production lines, but it will be a couple of years before it expects to meet the full demand, CNN said.

The company also said that Christmas candy might be affected by the supply issues, but Hershey’s still expects sales to top 2021, estimating a 12% and 14% increase, Reuters reported.

As of Friday at 9:55 a.m. ET, shares of Hershey were trading at $229.13, up $4.86 or 2.17%.