Cocoa prices (CC=F) have surged more than 40% over the last month. Extreme weather has disrupted cocoa production, sending prices skyrocketing. So what are candy makers doing to cope?

Master Chocolatier and Jacques Torres Chocolate Founder and CEO Jacques Torres tells Yahoo Finance that there are a few options. One possible solution is using more filler so that customers can get what they are paying for, but the business can use less chocolate, explaining that it's a "question of balance, but it's also a question of economics." "If your almonds are a little less expensive than your chocolate, you're going to a little bit more almonds," Torres says.

Be sure to watch the full interview with Jacques Torres. For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Stephanie Mikulich.

Video Transcript

[AUDIO LOGO]

JULIE HYMAN: Cocoa prices are soaring to record levels amid supply constraints. The price surge placing cost pressures on chocolate makers. To take an inside look at the sweet and sour aspects of the world of confectionery, we have master chocolatier Jacques Torres, Founder and CEO of Jacques Torres Chocolate.

Thank you so much for being here. Really appreciate it.

JACQUES TORRES: Thank you.

JULIE HYMAN: So everyone has been talking about these big increases in Cocoa prices. And here on Yahoo Finance, we have talked about it sort of from the commodity and from the market perspective. But obviously, this is something that we may all have to deal with from the eating perspective as well if we're treating ourselves. How is this playing into your business? Have you had to raise prices as you've seen these costs go up?

JACQUES TORRES: OK. So first, thank you for having me and thank you, Julie, to be able to talk to you. It's very worrisome because we don't know where that's going, we don't know if the price is going to go down. My belief is that 3,000, maybe even $4,000 a ton is not enough for the farmers.

So if we have a correction and if the price go up, I'm not against it. That will make the farmer happier. And hopefully, they will not stop to grow cacao.

The problem with cacao is you have only to harvest a year. And there is some crops where you can harvest all year and maybe make more money. That's why some of the farmer will cut some trees to go to somewhere to something else.

Cacao, especially in Ivory Coast and Ghana are very sensitive. If you get too much water, you're going to get some disease that's going to develop into the tree. Or if you don't get enough water that's what's going on now, first, they get hit by disease. And then no enough water and we don't have enough cacao, you look like we're going to miss between 20% and 25% of cacao this year.

So it's very worrisome. Because if we don't have enough cacao, of course, the price is going to go up. And it's going to be difficult to find supply. So I don't know. Yes, again, very, very worrisome.

JOSH LIPTON: And, Jack, I mean, raising prices could be one lever you could pull. You could also, Jack, you could reduce the size of your product, you could make smaller chocolates. Would that ever be a possibility?

JACQUES TORRES: What we do when we have a problem like that, we might put a little bit more inclusion into the chocolate. So let's say that you make a chocolate bar with almonds, with hazelnuts, with pistachios, with peanuts, with whatever you're going to put into this chocolate bar. You might add a little bit more almonds.

So the weight of your chocolate bar will be exactly the same, but it will be more inclusion will be more almonds. So whatever you're going to add into the chocolates, we can do the same with the little bonbon in a box of chocolates. We can put a little bit more filling.

Again, it's a question of balance, but it's also a question of economic. If your almonds are less expensive than your chocolates, you're going to put a little bit more almonds. So you need to try to find a way to not cut the size of your product, but maybe change a little bit the composition to make the customer happy.