2024-05-04 10:45:07
Lhe ups and downs of cocoa. Brown powder is plagued with speculation. Nothing new in itself, except the scale of the phenomenon this time. Already at the end of October 2023, while the first Christmas packets were strutting their stuff on supermarket shelves, cocoa was starting to catch fire in the markets. It was then trading at 3,800 dollars (3,543 euros) per tonne in New York, and observers, eager for historical comparison, pointed out the fact that such a level had not been reached since 1979. Cocoa takes over the coconut tree , they thought.
But they hadn’t seen anything yet. With cocoa, speculators have drawn the bean. In February, in New York, the price of cocoa fruit shattered its historic record dating from 1977, to exceed the $6,000 per ton mark. Some people then imagined that the paroxysm of buying fever had been reached. Nope. The appetite for profit has not waned. Cocoa continued to soar at its highest.
At Easter, media tension was at its peak. Even if this spectacular rise in prices was not yet really perceptible in the form of inflation on the shelves, the concern of lovers of chocolate sweets was growing along with the markets. In mid-April, cocoa recorded record prices, trading at $11,722 per tonne in New York and at £9,285 (10,820 euros) per tonne on the London Stock Exchange.
Less bountiful harvests
To justify this rush for black gold, investors have weighed the imbalance between supply and demand. The harvests in West Africa, where the heart of cocoa beats, were less bountiful than hoped. In Ivory Coast, a country which alone accounts for 45% of world production, heavy rains, a source of fungal attacks, have given way to intense heat and drying winds. A weather cocktail capable of curbing cocoa tree production.
The meager remuneration of planters, who hardly make any money from cocoa, also contributes to the reduction in the volume of beans. Faced with the surge in prices, the purchase price of cocoa from Ivory Coast growers was however increased by 50% to 1,500 CFA francs (2.30 euros) per kilo. A more attractive price for the intermediate harvest which takes place from April to September.
Is it the prospect of these new emoluments, the arrival in Ivory Coast of long-awaited rains, or more surely the limit of the dangerous game of money flows? For around ten days, the tide has been turning on the markets. Hit on the cocoa pod! And the fall is as brutal as the rise was spectacular. The price of a ton of this precious commodity fell below $7,000 on Friday, May 3, a plunge of almost 40% compared to its record. The cocoa market smells of powder…
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#hit #cocoa #pod
