Cocoa beans outperform bitcoin in terms of profitability and guarantee sky-high prices for chocolate
24 December 2024 14:11
Cocoa is showing the largest growth among major commodities this year, outpacing even the growth of the US stock market and bitcoin. Prices for the main ingredient in chocolate have more than doubled in 2024, hitting a new record high this month, "Komersant Ukrainian" reports citing MarketWatch.
Thus, cocoa futures for March 2025 delivery closed at USD 11,954 per ton. USD per ton on Friday, showing an increase of almost 185% since the beginning of the year. For comparison, the growth of bitcoin was about 128%, and the S&P 500 index (500 largest companies) – only 25%.
The situation with cocoa has not changed significantly since the beginning of the year – unfavorable weather in Côte d’Ivoire in West Africa remains a key factor. The 2023-2024 marketing year for cocoa ended with the largest global supply deficit in 60 years.
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The International Cocoa Organization has recorded a global production deficit of 478,000 tons for the 2023-2024 season, which ended at the end of September. Global production fell by 13% last season, and end-of-season stocks fell by 26%.
Record warm oceans around the world “have exacerbated an already difficult situation for West African cocoa crops, which have suffered from 2 years of extreme weather.” A wet October has again damaged cocoa trees in regions of West Africa, and recently warm, dry Harmattan winds have appeared. This weather is considered critical for cocoa production.
Despite historically high prices, consumer demand remains strong. According to experts, chocolate, like coffee, is one of those products that consumers are reluctant to give up – it is a good example of inelastic demand. Therefore, chocolate prices will continue to rise.
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