(MENAFN) Cocoa prices have experienced an unprecedented surge, nearly doubling within a span of three months to reach record highs. This surge has been primarily driven by a sharp decline in global cocoa supply, particularly influenced by adverse weather conditions in West Africa, the leading cocoa-producing region.
The price per ton for May-dated cocoa traded on the New York Mercantile Exchange soared to an all-time high of over USD9,600, reflecting the severity of the supply shortage. Data from the analytics and consulting firm, GlobalData, indicates an estimated 8 percent decrease in cocoa supply for the 2023-2024 season compared to the previous year, with significant challenges reported in key cocoa-producing countries such as the Ivory Coast and Ghana.
In response to the escalating costs and supply constraints, major cocoa mills in the Ivory Coast and Ghana have opted to reduce or halt production, exacerbating the supply crunch. Forecasts suggest a considerable decrease in cocoa harvests, particularly in the Ivory Coast, which accounts for 45 percent of global cocoa supply.
Moreover, other cocoa-producing nations like Nigeria and Ghana are also experiencing below-par harvests, contributing to the overall supply shortfall. The intermediate harvest, expected to commence in April, is anticipated to further suffer due to adverse weather conditions, including heat and drought, hindering the development of cocoa beans.
The relentless surge in cocoa prices has led to unprecedented levels of uncertainty in the market, with prices hitting all-time highs on both the New York and London cocoa futures markets. Over the past three months, cocoa prices in New York have surged by more than 150 percent, while they have soared by 255 percent since March 2023. This surge has positioned cocoa as one of the highest rising raw materials, surpassing even copper, which reached USD9,000 per ton in 2024.
MENAFN27032024000045015839ID1108026112
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.