Investors with heavy short positions are forced to cover, or buy back, their shorts in the event of positive reports that result in a share appreciation. Consequently, the additional buying momentum from short sellers covering their options contracts helped bolster prices even further.

Over the long-term, fundamental factors may continue to support higher cocoa prices. For instance, demand for cocoa is rising at a long-term rate of 2% per annum, according to Mineweb. Urbanization and the rising middle class in developing economies has bolstered global demand for chocolate. Additionally, Ghana, a major producer of cocoa, is expected to see a decline in arable land as the region converts to gold mining.

iPath Bloomberg Cocoa Subindex Total Return ETN

Max Chen contributed to this article.