Cocoa beans in London, UK and New York, US trade at wide spreads

Published 2024년 9월 19일

Tridge summary

Cocoa bean futures prices have seen a differing trend on the New York Mercantile Exchange and the London ICE exchange since August. While prices on the New York exchange have seen a minimal decrease of 3%, those on the London exchange have dropped by 16%. The higher quality of futures in New York has led to higher prices, attracting hedge funds and resulting in a 15-year low in US cocoa stocks. In contrast, the lower quality of futures in London, along with the new EU Deforestation Regulation, has led to lower prices and increased volatility. The older, lower-quality beans from Cameroon in London stocks could still end up in chocolate products, and companies may cut costs by reducing the size of chocolate bars or adding more ingredients.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

Moscow. September 19. INTERFAX.RU - Cocoa bean futures prices have fallen by only 3% since the beginning of August on the New York Mercantile Exchange (NYMEX), while they have fallen by 16% on the London ICE exchange, the Financial Times writes. Last week, the cost of contracts in New York exceeded $10,000 per 10 tons, while in London earlier in September it fell below $6,400. This difference in prices and their dynamics is due to the lower quality of the product on the London exchange, the FT explains. Earlier in 2024, prices grew on both platforms amid interest from hedge funds and crop failure due to bad weather and diseases in Ghana and Côte d'Ivoire, where two-thirds of all cocoa beans in the world are grown. However, the global shortage has forced chocolate makers to pay increased attention to high-quality beans, and to bypass older varieties. As a result, US stocks of the commodity have reached a 15-year low, while London stocks are at their lowest since 2021. Martijn Bron, ...

Source: Interfax