Political unrest in Africa isn’t just having an impact on oil prices. Conflicts on the Ivory Coast have sent the cocoa exchange traded note (ETN) soaring, too.
iPath Dow Jones AIG Cocoa ETN (NYSEArca: NIB) is up a whopping 17.1% year-to-date and cocoa prices are at 32-year highs. What gives?
The main reason for the spike is a ban on cocoa exports from the Ivory Coast, which is contributing to a growing chocolate shortage. [Agriculture ETFs: Major Shortfall Predicted.]
Turns out the Ivory Coast is a big deal when it comes to chocolate.
Joel Rose for National Public Radio reports that the Ivory Coast produces about 40% of the world’s beans. Analysts think that processors and manufacturers are in pretty good shape, but more cocoa must come out of Africa to bring prices back to normal. [Sugar, Coffee And Cocoa Rally On Fundamentals.]
It might be time to stock up on Hershey bars.
Tisha Guerrero contributed to this article.
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.