2024-05-14 05:29:42
Cocoa prices on the New York futures market have seen a notable drop, attributed to forecasts of favorable rains for crops in West Africa, as well as comments from Rabobank suggesting that the historic cocoa rally has reached its peak. Maximum point.
Cocoa futures lost up to 2.5%, reaching US$8,482 per ton. Although volatility remains high, trading in recent days has been more moderate compared to the abrupt price movements seen in previous weeks. In mid-April, cocoa hit a record high above $11,000 due to severe shortages, before giving up some of its gains.
You may be interested in: Crops vulnerable to the La Niña phenomenon in Colombia
Paul Joules, an analyst at Rabobank, noted in a report that cocoa prices are unlikely to quickly return to “normal” levels, but that the peak of the rally has already been reached.
“The combination of weakening global demand and the response of production, especially in countries without fixed prices at origin, will help mitigate the great uncertainty surrounding current futures prices,” Joules said. However, he also warned that inflated cocoa prices are likely to persist in the coming years.
Traders are keeping a close eye on crop conditions in West Africa, where most cocoa is grown, after poor harvests left the world facing a third annual deficit.
Also read: Venezuela and Bolivia would surpass Colombia in economic growth
In the next five days, some rain is expected in West African countries such as Ivory Coast and Ghana, according to the forecast of Maxar Technologies Inc., which could offer a respite to crops and further affect prices in the international market. of cocoa.