• Tuesday, May 21, 2024
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Cocoa hits new record as North America demand keeps up despite price rise

Cocoa futures in New York touched a fresh record as the pace of processing in chocolate factories holds up despite a global supply crunch and record prices.

The most-active contract surged as much as 6.2% to touch an all-time high of $11,722 a metric ton on Friday. Data released Thursday after the market close showed so-called grinds — where cocoa is turned into butter and powder used in confectionery — rosenearly 4% in North America during the first quarter compared to the same period a year ago.

That contributed further to bullish momentum from Thursday’s session, which saw futures surge as much as 11% on smaller-than-expected declines in cocoa processing in Europe and Asia.

Most of the beans ground in the first quarter were likely from existing inventories and were purchased at lower prices, so the recent “super rise” in futures isn’t being seen further down the supply chain yet, said Jack Scoville, vice president at Price Futures Group.

“I do think really we’re still waiting to feel the the effects of the underlying cocoa bean prices in the marketplace,” Scoville said. “Once that hits, we’ll probably see a little bit more of a take down.”

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