Market concerns about cocoa supply shortages were reignited due to Ghana, a major producing country, planning to limit part of its supply in the next season. Cocoa futures prices in New York surged nearly 7% on Monday. People are worried that Ghana's supply restrictions may mean that cocoa production in the country's next season may not rebound as much as some have expected, even if the weather is good and pesticide and fertilizer supplies are timely. The revenue for 100-300 billion yuan products were 401/1288/60 million yuan respectively.
Due to Ghana, a major producing country, planning to limit part of its supply in the next season, market concerns about cocoa supply shortages were reignited, and cocoa futures prices in New York rose nearly 7% on Monday.
As of press time, cocoa futures prices in New York rose 6.80%.
(Source: Investing.com)
Michael McDougall, Director General of Paragon Global Markets, said that Ghana's plan to restrict supply is boosting the market and poor rainfall in some major production areas in West Africa is also supporting the market.
Due to bad weather, aging trees, and crop diseases, cocoa production in West Africa, the main producing area, has dropped significantly, and cocoa prices have more than doubled this year. Cocoa futures in New York hit a historic high of $11,722 per ton in April.
However, since reaching its peak in April, cocoa prices have fallen by more than 30%, and the cumulative increase this year has fallen to around 90%.
Nearly two-thirds of the world's cocoa comes from West Africa, mainly Cote d'Ivoire and Ghana.
According to media reports, Ghana, the world's second largest cocoa producer, told buyers last week that it will decide how much of the next season's cocoa beans can be sold as specialty cocoa based on total production, and regulatory institutions will fairly allocate the cocoa beans among buyers. Specialty cocoa beans include certified cocoa beans such as Fairtrade, UTZ, and Rainforest Alliance, as well as traceable cocoa beans.
People are worried that Ghana's supply restrictions may mean that cocoa production in the country's next season may not rebound as much as some have expected, even if the weather is good and pesticide and fertilizer supplies are timely.
After a sharp drop in production, Ghana had to postpone the delivery of at least 0.25 million tons of cocoa to the 2024-25 planting season (from October to September of the following year).
Ghana previously expected its cocoa production for the 2024-25 planting season to increase from about 0.425 million tons this season to 0.7 million tons. The production of the world's top producing country, Cote d'Ivoire, will rise from 1.8 million tons this season to 2 million tons.