When commodity analyst Judy Ganes spent 36 hours flying home from a business trip to Asia, it was what she didn’t see that stuck with her.

In the four airports she passed through, Ganes found almost no food courts or duty-free shops open for business. No snow globes. No t-shirts. No special liquor bottles. And perhaps most importantly, no Toblerone and other specialty chocolates that are ubiquitous in international terminals.

Ganes’ experience underscores the challenge facing sellers of not just candy but also spirits, with the airline industry still hampered by some travelers’ reluctance to fly and travel restrictions in some countries. The drop in duty-free sales has exacerbated the global economic downturn that’s thrown the $107 billion chocolate market into disarray, helping turn a global deficit into a glut.

“There’s no question the virus has been a hit for the duty-free industry across the board and chocolate is caught in it,” said Michael Payne, president of the International Association of Airport Duty Free Stores. “If you don’t have international flights and you don’t expect them to come back as quickly as domestic flights, then this pain is going to continue.”

There were 471,421 airline passengers in the U.S. on June 23, compared with 2.51 million on the same weekday a year earlier, according to the Transportation Security Administration.

On her journey from Palau, Micronesia—where she was grounded for two months after the nation imposed lockdowns to stem the spread of coronavirus—to Newark, New Jersey, Ganes saw few signs of life.

“In Honolulu, there was a gift shop open to buy chocolate-covered macadamia nuts, some kids books and games, smoked tuna jerky,” Ganes said. “In San Francisco all closed. In Newark, the only thing open was one grab and go place that had a rack with chips and gummies for 50% off.”

The International Monetary Fund lowered its outlook for the world economy, signaling a further hit to cocoa consumption, which tends to closely follow gross domestic product. The demand woes are inflicting another blow to processors of the cocoa beans, already facing rising costs in part because of sustainability initiatives in West Africa, which accounts for about two-thirds of world supplies.

Top producers Ivory Coast and Ghana announced that starting with the 2020/21 crop, they would add a $400 a ton premium on their beans in a bid to boost farmer income. That’s pressuring margins for the world’s top makers of bulk chocolate, as well as chocolatiers such as Lindt & Spruengli, at a time when consumption faces headwinds from several fronts.

Olam International Ltd., the third-largest processor, now expects global grindings to fall 1.5% this season, the first drop in four years. Some analysts are calling for bigger declines.

Mondelez International Inc. said in April that its world travel retail section is expected to see significant declines. The company has previously said travel represents about a third of the demand for Toblerone.

Brown-Forman Corp., the makers of Jack Daniels, said in a June 9 earnings call that its global travel retail segment, which includes duty-free sales, was down around 65%.

Fewer Cruises

It’s not just the lack of airport sales that’s dragging down cocoa. Chocolate-heavy events such as weddings have been postponed or canceled and cruise bookings are way down.

Peter Liszewski, a retired federal government worker living in Fort Lauderdale, Florida, typically takes three to five cruises a year, which include a chocolate placed on the pillow every night. This year, he’s taking only one trip and has rebooked two of them for 2021. He also delayed a trip to Boston, where his nephew postponed his wedding.

“Cruises won’t be happening for those large brands until early October at earliest,” said Brian Egger, a Bloomberg Intelligence analyst.

Companies that cater to these segments are feeling the pinch, including Dufry AG, a major duty-free shop operator, as well as Sodexo SA and Compass Group LLC, two of the biggest companies catering to the food-service industry.

Not all is completely dire though. Hershey Co., whose brands such as Hershey’s, Kisses, Reese’s, Brookside and BarkThins are available at airport duty-free locations worldwide, sees a shift that’s helping the company navigate the crisis.

“The slowdown in air travel has certainly impacted retailers who operate within airports,” Jeff Beckman, a company spokesman, said by email. “But as Covid has changed how people are living their daily lives, we have seen volumes shift to other areas of retail and other pack-types, such as larger ‘take-home’ bags, e-commerce, and at-home baking and cooking products.”

Still, slack demand will probably help flip the global market to a surplus of more than 300,000 tons from a deficit a year earlier, according to Eric Bergman, vice president at JSG Commodities in Connecticut.

In the year ended June 14, U.S. sales of candy chocolate at traditional retail outlets fell 1.9% from a year earlier, while the average price advanced 4.7%, according to IRI, a Chicago-based market researcher.

“It will take some time for demand to come back,” said Nick Gentile, managing partner for NickJen Capital Management in New York. “Now that the Covid cases are going up again, I think it will hurt more.”