Yahoo Finance Cocoa Drops 11% Following Three-Day Rally in Volatile Market
(Bloomberg) -- Cocoa futures fell as much as 11% in New York, the biggest intraday drop in a month, before quickly paring the worst of the declines as the market continues to see wild volatility.
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The downward plunge follows a three-day rally that had pushed futures to settle above the $10,000 per ton mark for the first time since April.
Prices have more than doubled this year on the back of bad harvests in top growers Ivory Coast and Ghana, fueling shortages and stoking fears that some exporters won’t be able to fulfill contracts.
Second-largest supplier Ghana expects its cocoa crop to recover next season as favorable weather and timely supplies of pesticide and fertilizer help farmers claw back from a potential two-decade low that’s pushed prices to record highs.
Mondelez International Inc., the maker of Toblerone bars and Oreo cookies, said Thursday that a drop in cocoa costs is likely by next year. It’s looking to protect chocolate sales volumes by continuing to offer treats at affordable prices.
Still, there is uncertainty about future bean availability. Traders have showed concern that a large portion of bean deliveries expected for this year could be postponed, which would limit new sales.
Cocoa was down 5.8% to $9,522 a ton as of 12:08 p.m. in New York.
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