Rising food prices have been a boon to commodities exchange traded funds (ETFs) this year. Corn, wheat, soybeans, sugar, you name it – it’s getting pricier by the minute.
But…chocolate? Precious, precious chocolate that many of us consume by the pound?
Yes, indeed. The world’s cocoa supply is threatened, reports Scott Jagow for Marketplace. Now, let’s everybody stay calm – there’s no reason to run to your local Sweet Shoppe and hoard the chocolate goods yet, unless you’ve got a craving that just can’t be denied.
That’s because government scientists and the candy industry are hard at work to make sure that you still get your M&Ms fix, since they might be the only thing keeping you from chewing your nails off as the price at the gas pump ticks higher and higher.
The cocoa tree is facing disease and drought, and lost crops have cost farmers about $700 million a year. Falling supply has doubled bean prices in many places.
The government to the rescue: scientists are sequencing the cocoa bean genome to produce more disease-resistant varieties of cacao. Mars Inc. will contribute $10 million to fund the project.
The newly-launched iPath Dow Jones-AIG Cocoa Total Return Sub-Index (NIB) is one way to capture the rise in cocoa prices, especially if drought and disease continue to be a factor.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.