“Monday’s price surge is also linked to the cocoa market consolidating after last year’s severe declines brought on by concerns of ample supplies from West African cocoa producing countries,” Sudakshina Unnikrishnan, agriculture analyst at Barclays, said in the WSJ article. “Partly markets are finding a footing now as all eyes turn to the upcoming grind figures issued by the European Cocoa Association this week.”
The Rabobank International projects supplies will fall behind demand by 29,000 tons in the season started Oct. 1. Additionally, the bank expects the shortage to increase if weather in West Africa turns “unconstructive.”
“The market may have overshot on the downside and now as these concerns increase we are seeing prices rebounding,” Keith Flury, senior softs analyst at Rabobank, said.
iPath DJ-UBS Cocoa Subindex ETN
For more information on cocoa, visit our cocoa category.
Max Chen contributed to this article.
