The news: Early reports indicate a decline in Halloween candy sales as consumers grapple with higher prices.

• Nielsen IQ reported a 6.7% decrease in sales for the month ended October 17, per data shared with the Associated Press.
• Chocolate sales were down 2% YoY in the first two weeks of October—with a 5% increase in pricing more than offset by a 7% decrease in volumes—according to Consumer Edge. Non-chocolate candy sales fell 9% in that period, with pricing up 2% and volumes down 11%.

Zoom in: The downturn in candy demand reflects the growing pressure that rising gas and grocery prices are putting on consumers’ wallets, compounded by fatigue over higher candy costs. Shoppers are increasingly opting for smaller pack sizes, with small bags the only size to register growth through mid-October, while large and extra-large bags had the largest declines, Chris Costagli, a vice president and food thought leader at NielsenIQ, told the AP.

Rising commodity costs—particularly the soaring price of cocoa—have pushed the price of candy up significantly faster than inflation. Prices for candy and chewing gum were up 7.7% YoY in September, more than three times the rate of food inflation, per the Bureau of Labor Statistics. Shoppers have responded by buying fewer sweets: Compared with three years ago, October-to-date chocolate sales volumes are down 7%, while non-chocolate candy sales volumes are 6% lower, according to Consumer Edge.

Implications for retailers: Softening candy demand in the leadup to Halloween suggests that more consumers are managing their spending, potentially conserving budgets for the holiday season. Many shoppers may also be waiting until the last minute in hopes of scoring a better deal—behavior that could carry over into the year-end holidays as consumers look for ways to celebrate without straining their wallets.

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