Cocoa Prices Soar To Record Highs As Traders Scramble

By Reuters
Cocoa Prices Soar To Record Highs As Traders Scramble

Global cocoa prices hit record highs on Thursday as traders continue to search for supplies, it was reported today.

The news predicts wider deficits this season and growing concerns for the next.

The surge in prices has also filtered to retail shelves.

Hershey is expecting to see a further slowdown in demand for its products from cash conscious customers after its sales volumes slid 6.6% in the fourth quarter.

The chocolate maker’s shares are down some 30% from May. It also said earlier that it expects the higher cocoa prices to limit its earnings growth this year.


Volumes at Hershey’s rival, Cadbury maker Mondelez, also fell last quarter.

Lower Output

Meteorologist and commodity trading adviser at Best Weather Inc. Jim Roemer said that historically price blips are followed by a 20-50% price break within one to two years.

However, he said his sources suggested that the current situation appears to be an exception.

Roemer said, “At least for now, a squeeze situation may well continue for another month or two." He cited current damage to the cocoa crop from strong Harmattan winds in top producing region West Africa.

Exporters and pod counters in the number two cocoa producer in Ghana told Reuters that output for the current 2023/24 season is expected to reach 475,000-500,000 tonnes.


This is much lower than last year’s 655,000 tonnes.


Last week, a Reuters cocoa poll forecast a global deficit of 375,000 tonnes in the 2023/24 season.

This is more than double the average view in the August poll, and indicates a third successive supply deficit for the market.

An industry source told Reuters that traders feared the shortage will extend into next year, as missing volumes from this season’s crop will have to be filled with beans from the next.

“What happens if the crop is poor next season?” the source asked.

Read More: World Food Price Index Falls To Lowest Level In Three Years

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