Cocoa exchange traded notes are looking sweet as traders push cocoa futures to a two-week high on crop damaging weather conditions.
The iPath DJ-UBS Cocoa TR Sub-Index ETN (NYSEArca: NIB) jumped 3.2% Tuesday while the iPath Pure Beta Cocoa ETN (NYSEArca: CHOC) surged 3.6%. Year-to-date, NIB is up 17% and CHOC increased 16.2%. [Speculators Run Up Cocoa Prices, ETN]
Indonesia, the third largest-largest producer of cocoa, could see exports drop 14% year-over-year for 2013, reports Michael Taylor for The Jakarta Globe.
“Heavy rains in Indonesia have hurt the cocoa crop — there are many black pods and instances of the cocoa pod borer disease,” Zulhefi Sikumbang, chairman at the Indonesian Cocoa Association, said in the article.
ICE cocoa futures were up 3.1% Tuesday, trading around $2,736 per metric ton.
The latest out of Indonesia “opens the door to go test $2,800 again,” Hector Galvan, senior broker at RJO Futures, said in a Wall Street Journal article.