This year, cocoa is showing the largest increase among all major commodities, outpacing the growth of the U.S. stock market and even Bitcoin.
This is stated in the publication of MarketWatch, the Ukrainian News agency reports.
The publication says that cocoa is the most expensive commodity of 2024, with prices increasing by almost 185%.
According to ING, the 2023-24 marketing year ended with the largest global cocoa deficit in the last 60 years.
On Friday, December 20, cocoa futures for delivery in March set a price of USD 11,954 per metric ton, which indicates an increase of almost 185% since the beginning of the year (Dow Jones data).
For comparison: Bitcoin has increased by 128%, and the S&P 500 index – by only 25%.
A key factor in this growth remains adverse weather conditions in Côte d’Ivoire, the world’s largest cocoa producer.
According to Darin Newsom, senior market analyst at Barchart, the cocoa forward curve is showing a backwardation, indicating concerns about the long-term supply-demand balance.
As long as weather remains an issue, Newsom said he’s “expecting more investment money to move into the softs sector, including cocoa.”
Other “soft” commodities are also showing significant growth, with orange juice futures up 75% and coffee up 73%.
The International Cocoa Organization forecasts a global deficit of 478,000 metric tons in the 2023-2024 season; global production will fall 13.1% and stocks will fall 26.8%.
On December 18, the price of cocoa reached an all-time high of USD 12,931 per metric ton.
Despite this, demand remains stable.
“We see this time and again in agricultural commodities — challenging weather hits production, yet demand remains robust,” Jake Hanley, managing director and senior portfolio specialist at Teucrium, told MarketWatch.
Chocolate and coffee are examples of products in extreme demand, even with rising prices, consumers are not ready to give them up.
As the Ukrainian News agency earlier reported, in March 2024, major African cocoa factories in Côte d'Ivoire and Ghana stopped or reduced processing because they cannot afford to buy beans.
It is predicted that chocolate prices around the world may increase sharply.
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