Cocoa prices topped $4,000 per tonne in New York on Friday, marking the highest point since 1978. This surge was driven by the bullish factor of anticipated poor crop harvests across West Africa, contributing to the upward trajectory of prices throughout the week.
Zero Hedge reported a growing concern that El Nino-induced weather disturbances pose an escalating risk of pushing the global cocoa market into a deficit for the third consecutive year.
As per Bloomberg, Ivory Coast and Ghana, among the globe’s major cocoa producers, are experiencing reduced crop yields in their harvests. This circumstance has resulted in constrained supplies, consequently bolstering higher prices.
“The market does not seem convinced that production will recover enough to avoid a supply deficit for 2023/24,” ADM Investor Services Inc. analysts said in a note, Zero Hedge reported.
Cocoa futures rose 1 per cent in New York, topping $4,000 a tonne for the first time in 45 years.
Earlier this week, Oreo-maker Mondelez International said it would have to hike prices on some of its products due to the soaring cocoa and sugar prices.
Meanwhile, sugar prices hit decade highs on global shortage fears in April. And Arabica coffee prices are set to move higher after inventories hit 24-year lows, Zero Hedge reported.