With cocoa futures rising with the current chocolate shortage, a former European banker is betting on reviving cocoa farming in the Amazon basin where the bean once flourished. Cocoa futures are up 14 points (as of this writing) in New York at the Commodity Exchange Center.
There is actually a Latin America push to get cocoa beans growing in South America in similar growing conditions than the West African cocoa farmer counter-parts. The African cocoa trade dominates the industry with 70% of the market, but the push really comes from recent drought in Africa preventing supply to meet demand.
Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, shared his fundamental analysis insight regarding the current cocoa futures situation by stating, “It appears the demand for cocoa is growing at a pace African cocoa farmers can’t keep up with.” Medina adds, “I think the South American effort comes at an opportune time to supply the ever-growing ‘chocolate business’.”
Cocoa futures trend is recently up. Although I don’t trade cocoa futures any longer, I do monitor it as it tends to coincide with my preferred confectionery market of sugar.
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