Cocoa Prices Sour 20 Percent Amid Supply Concerns, Weather Conditions
(MENAFN) Cocoa prices have surged by over 20% in May, rebounding to over $11,000 per ton after experiencing a sharp decline earlier this year. The price had dropped more than 34% to $7,613 per ton, but has since recovered some ground. Though prices remain 5% lower compared to the end of 2024, they have jumped 24% since April, peaking at $11,280 this month.
Demand for cocoa waned earlier due to prices exceeding production costs, while expectations of a looming oversupply further drove prices down. However, the market began to stabilize as increased cocoa exports from Nigeria alleviated some of the supply concerns.
Statements from executives at Hershey’s and Mondelez International about high prices dampening demand also played a role in affecting cocoa prices. Still, the surge in prices has sparked expectations that new records may soon be reached.
Last year, cocoa prices hit an all-time high of $12,931 per ton.
Concerns over cocoa supply intensified as the slowdown in exports from the Ivory Coast highlighted potential shortages. Additionally, adverse weather conditions in West Africa, particularly in Ghana and the Ivory Coast, pushed prices even higher. Recent reports show that over a third of both countries are still facing drought conditions despite some recent rainfall, according to the African Flood and Drought Monitor.
Quality issues with cocoa from the Ivory Coast have also contributed to the rising prices.
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