Economy March 30, 2024 | 12:04 pm

Buy car in DR

Cocoa more expensive than copper for the first time in history

London—The escalation of cocoa prices has no limits and has surprised even professionals in the sector, who speak of a “market gone mad.” Prices have doubled since January, with a 60% rise in March alone. This week, on the London Stock Exchange, cocoa prices fluctuated by more than 600 pounds in a single day, while a year ago, daily variations were between 15 and 20 pounds and even reached 50 pounds.

Supply crisis

These prices, which seem to have no ceiling, reflect the declining harvests in West Africa, linked in particular to poor weather conditions, aging plantations, and the persistence of a high prevalence of diseases affecting cocoa trees. The main crop that just ended could be down by a quarter or even a third, and the next one, which is about to start, does not look any better.

The massive fear among manufacturers also drives up prices of running out of raw materials. “Everyone is panicking,” the head of Guan Chong Cocoa (GCB), one of Asia’s largest cocoa bean crushers, said a few days ago.

Another industry expert confirms: “Cocoa butter traders and manufacturers are looking for beans everywhere. The only watchword is to buy, regardless of origin and quality.”

Deteriorating supply

Some millers do not hesitate to pay premiums for supplies in the hope of not having to close their factories. Apart from Côte d’Ivoire and Ghana, where prices are fixed for the whole season, most other origins have seen their prices soar: grains can now be bought at 4,000 CFA francs per kilo in Madagascar, for example, and at 5,000 CFA francs in Cameroon.

One of the crushers confesses that the situation is so tense that they have exhausted half of their grain stocks. Smaller processors have only a few days’ stock left.

Another consequence of this increase for consumers is that the price of eggs and other Easter figures has skyrocketed. The situation could worsen next year, as most price increases are passed on with a time lag of several months.

0 0 votes
Article Rating
Notify of

Inline Feedbacks
View all comments